The Consortium for Elections and Political Process Strengthening is the prime recipient of the United States Agency for International Development’s Democratic Elections and Political Processes Leader with Associates Award. Under this award, our three core institutes (the International Foundation for Electoral Systems, the International Republican Institute, and the National Democratic Institute) are joined by four senior technical partners (STP) which include: The American Bar Association Rule of Law Initiative, the Center for International Private Enterprise, Democracy Arch, and Internews. This is an introduction to CIPE.
USAID/CEPPS DEPP Award Senior Technical Partner – CIPE
Private enterprise and democracy fit together like a hand and glove, and yet neither function particularly well when separated. Just as democracies respond to the needs of their citizens, private enterprise and global trade have historically lifted societies out of poverty more often than anything else in human history. While entrepreneurship is not perfect, and financial gaps remain throughout free market societies, people can, inevitably, be left behind. So, the key, according to Center for International Private Enterprise (CIPE) is to create developing economies that deliver for all by strengthening and expanding participation in the shaping of governing policies.
CIPE is a U.S. non-profit organization whose mission is to strengthen democracy around the world through private enterprise and market-oriented reform. Founded in 1983 and based in Washington, DC, CIPE works by encouraging and enabling business communities to actively participate in the democratic process and in the development of democratically-governed, inclusive market economies. CIPE’s core focus areas are: Anticorruption and ethics, business advocacy, democratic governance, enterprise ecosystems, trade, accountable investment and women’s economic empowerment. CIPE is an affiliate of the U.S. Chamber of Commerce, the world’s largest independent business membership organization.
Businesses come in all shapes and sizes and are as diverse as the public. This includes large firms, multinational corporations, small and medium enterprises (SMEs), entrepreneurs, family businesses, women-owned businesses, and informal enterprises. While their interests may vary, all benefit from participating in collective action through civil society.
CIPE executes its work through joint ventures with local partner organizations, business associations, chambers of commerce or industry, think tanks, or other reform-oriented civil society organizations representing the business community. The local partners bring deep local knowledge, networks, and experience, and CIPE adds technical and financial assistance, access to a global network of reformers, and capacity-building that enhances the long-term efficacy and sustainability of the partner itself.
As CEPPS’s lead on private sector participation and economic governance for USAID’s DEPP award, CIPE will provide support and capacity building to private sector actors and local business organizations in their engagement in the democratic process, as well as reinforcing anticorruption practices, increasing transparency, and strengthening compliance programs. Through their work, CIPE will champion market-oriented democratic systems, promote inclusive approaches to entrepreneurship and engage business communities on collective action.
All over the world, small businesses are the lifeblood of healthy market economies and make up a sizeable grassroots, democratic constituency. Even the most well-intentioned laws can impose existential burdens on small businesses for whom compliance is often disproportionately costly. Without talking to business owners, these unintended consequences are often discovered too late.
For example, in Ukraine CIPE has helped its business association partners at the national and regional levels deploy a regulatory impact analysis. Specifically, the “M-Test” methodology, quantifies the impact of proposed legislation or regulation on small businesses and serves as a tool to shape their advocacy. Using the M-Test to evaluate the impact of reduced corruption, associations in three oblasts successfully advocated changes in local regulations that they estimate will save businesses at least 12.6 million Ukrainian hryvnia and eliminate 180 corruption risks. In 2021, CIPE and its partners applied the M-test to a draft ministry of finance regulation governing businesses’ accounting for inventory balances. CIPE’s partners’ analysis predicted a significant burden on SMEs to comply with the regulation, which the M-Test estimated would total more than $33 million per year for the 321,000 Ukrainian small businesses affected. Due to a concerted advocacy effort by CIPE’s partners, the ministry abandoned the draft regulation. As Ukraine’s war with Russia continues, CIPE is supporting its private sector partners as they organize to mitigate the effects of conflict, including offering humanitarian aid, maintaining supply chains, and engaging Ukraine’s leadership on potential economic recovery and reconstruction plans.
CIPE’s work in Ukraine is just one example of how the organization supports local business groups to actively engage in democratic policymaking to help ensure that democracy delivers for all its citizens. For more information, check out their website.