A Conceptual risk management framework for public private partnership in Developing Countries: a Ghanaian and South African perspective

Abstract

Purpose––No public-private partnership (PPP) project is risk free. Therefore, there is the need for an efficient risk management procedure to deal with the inherent threats and opportunities represented by such potential risks. The purpose of this research aims at explaining the key issues and concepts involved in risk management processes and principles in PPPs, and also to design a risk management framework that can reinforce the management of PPPs. Design/methodology/approach––Stakeholders in PPPs expect risk management to be appropriate and adequate to aid in the successful implementation of PPPs. In theory and practice, it seems that risk management in PPPs has been approached in an unstructured manner, which lowers the quality of risk management activities and does not support the successful management of PPPs. A survey of risk management and PPP experts’ opinions was conducted on multiple PPP projects, following an extensive literature review and an empirical case study. This approach was adopted to test the applicability of the proposed conceptual risk management framework for PPPs. Findings––The research presents and describes PPP modalities and theories, analyses the various types of risks in PPPs, and describes the risk management processes and principles that are applicable in PPPs. The conclusions drawn from the literature review were used to develop a structured approach to risk identification in PPPs, and to design a conceptual risk management framework for PPPs. Originality/Value––The study used a scientific approach to test the proposed framework and its applicability to PPPs. The proposed conceptual risk management framework for PPPs bridges the gap between the unstructured and structured approaches to risk management activities in PPPs, both at the theoretical and practical levels. The proposed conceptual risk management framework broadens PPP stakeholders’ views on the importance of adopting a structured approach to risk management in PPPs, which seems to have received less attention previously in research efforts or studies on risk management in PPPs.