The DCED defines
the business environment as a complex
of policy, legal, institutional, and regulatory conditions that govern business
activities. It is a sub-set of the investment climate and includes the administration
and enforcement mechanisms established to implement government policy, as well as
the institutional arrangements that influence the way key actors operate (e.g.,
government agencies, regulatory authorities, and business membership organisations
including businesswomen associations, civil society organisations, trade unions,
with other private sector development initiatives, the business environment affects
the performance of private enterprises in both the formal and informal economies.
Business environment reform promotes the development of markets that encourage competition
and enhance the effectiveness and sustainability of other development interventions.
Many agencies consider a conducive business environment as one of the pre-requisites
for economic growth and poverty reduction. [DCED,
Overview of the DCED's work on Business Environment
The DCED's work in this theme is driven by the Business Environment Working Group
(BEWG). Four conferences have now been organised; the first three informed the development
of the Donor Guidance document (see below). All of the materials generated by these
conferences, including case studies, related research and synthesis documents, are
posted on the Business Environment database at www.Business-Environment.org.
Practical Guidance on Supporting
Business Environment Reforms
In 2008, the DCED published "Supporting Business Environment Reforms. Practical
Guidance for Development Agencies" ("Yellow Book"). Versions in different languages
and supporting materials can be downloaded below.
Click on the links below to access supporting
materials on the practical guidance:
Annex to the Practical Guidance on Supporting Business
Environment Reforms: How Business Environment Reform Can Promote Formalisation
This Annex to the Practical Guidance on Supporting Business Environment Reform (BER), published
by the DCED in 2011, focuses on how BER can address the informal economy and encourage
the formalisation of informal enterprises.
Country-Level Reviews of Donor Support to Business
In 2010, the DCED initiated
a pilot project to review donors' programmes and practices in support of BE Reform.
Three countries were chosen: Kenya, Bangladesh and Rwanda. The report below presents
findings from the first review.
Other DCED Publications on BER
In addition to the Practical Guidance on BER and associated documents, the DCED
Business Environment Working Group has also published other papers and reports on
the theme. These are listed below.
The Political Economy of Business Environment Reform: An Introduction for Practitioners
This paper, published by the DCED in 2011, considers how political economy issues
donors’ efforts to support business environment reform, and suggests ways
which practitioners can address these issues. The paper draws on examples from four
Business Environment Reforms and the Informal Economy
In 2009, the DCED commissioned a discussion paper on Business
Environment Reforms and the Informal Economy,
written by Professor Clifford Zinnes.
Photographs courtesy of Melina Heinrich