I’ve just been reading an interesting article on collaboration and sustainability from Jonathan Rowson at the RSA. In it he makes the case for why we need businesses to collaborate in areas such as low carbon energy supply in order to develop long term sustainable solutions to global problems. And he contrasts this with UK and Dutch examples of governments using competition laws to challenge collaborative arrangements between organisations which might be seen to increase costs to consumers in the short term.

This got me thinking about what competition laws are really for. Essentially if collaboration between companies leads to market manipulation and collusion on prices that is a bad thing. Consumers lose as companies (and their shareholders gain). But if collaboration across a system produces joint investment (in new technologies, and the infrastructure to support their deployment) then consumers may pay more in the short term for benefits (financial or otherwise) they want in the longer term. Its then a matter of collective choice (through the ballot box or through our spending decisions) how to balance these short term and longer term costs and benefits. The challenge for governments is how to develop the tools and mechanisms which can examine what is going on inside a collaborative system and make it transparent to voters and consumers.

This is a problem that Elinor Ostrom spent her life working on. Her book ‘Governing the commons – the evolution of institutions for collective action‘ was the foundation for her nobel prize in economics and is still the definitive guide to how human communities the world over have been able to share scarce resources and govern the public realm. She uses lots of  experiments in game theory to show how collaborative strategies can produce the best results – and suggests a set of principles that any community can follow to achieve “optimal outcomes for all”.

For me the key is for governments and policy makers to look beyond the simplistic rhetoric of ‘competition = good & collaboration = bad’ (or indeed vice versa) and to lead a debate about the resources we all need to share and the compromises we may need to make now in order to reduce the risks to the future. I’ve always advocated that leaders need to find the self interest in collaboration. Successful and sustainable collaboration is never built on altruism but on solid analysis of the consequences of interdependence. Business leaders have been working with this for many years now and building profitable organisations that thrive in collaborative networks of interconnected partners, suppliers and customers. Its time for politicians and policy makers to do the same.