© Victoriano Danilo

Water Integrity: an Opportunity for the Private Sector

Brief: Integrity Risks of Private Sector Participation in Water Service Provision and Paths for Improvement

At least 909 million people received water services from the private sector to some extent in 2011. The private sector plays a crucial role in water services provision. When not directly in charge of water supply, the private sector also contributes through contracted services, equipment, research and investment, at multiple levels.

Many private companies are often seen as the “supply side” of corruption, paying bribes or initiating corrupt acts such as collusion, yet they are also its victims, suffering when competitors bribe and collude with public officials.

This brief examines the key risks associated with private sector participation in water service provision, with a special focus on contracting risks and influence over political processes. It provides examples of corruption cases at different scales that have tarnished the reputation of the sector.

It concludes by pointing out some paths for change and risk mitigation:

  • Reliable regulation as a prerequisite, along with its corollary -enforcement
  • Integrity as a business opportunity, to lower costs and increase margins, and to reduce legal and reputation risks