International consortiums: What are they and how do they work?

An international consortium is a group of companies or organizations from different countries that come together to implement a major project. Typically, consortium members share financial resources, knowledge, and technology to achieve a common goal. Each consortium member may have a specialized role in the project, such as design, construction, management, or supply of materials.

The main purpose of creating consortia is to distribute risks and costs among several participants, especially when it comes to complex and expensive projects.

Consortiums can vary significantly in form and structure, from formal legal organizations with defined governance frameworks to more casual, collaborative arrangements between companies. Some consortiums are set up for short-term purposes, designed to complete a specific project, while others establish long-term partnerships aimed at ongoing collaboration between businesses.

Consortiums often operate in areas such as:

· Energy: construction of nuclear and hydroelectric power plants, renewable energy sources (e.g. wind and solar power plants).

· Infrastructure: construction of large bridges, tunnels, airports and rail networks.

· Technology: development of complex technological systems, for example, in space or telecommunications.

· Healthcare: consortiums to develop and produce vaccines or medical equipment.

· Mining: development and exploitation of large deposits of natural resources.

· Education: universities and colleges teaming up to work together and share resources to improve the quality of education and give students greater access to opportunities.

For example, if we are discussing the construction of a nuclear power plant, the “Akkuyu” Nuclear Power Plant (NPP) project, currently under construction in Türkiye. The consortium behind this project includes several international partners. “Rosatom” is responsible for the nuclear reactor and all the surrounding equipment. French companies were involved in supplying electrical equipment - turbines, generators, and the control electronics were provided by the German company Siemens AG. Additionally, other components were purchased from various companies.

American artificial intelligence research organization OpenAI is also a consortium, bringing together leading technology companies such as Microsoft, Google, IBM, and Amazon, along with individual researchers. The organization’s mission is to promote and develop AI that is beneficial for humanity, ensuring that advancements in artificial intelligence are ethical and safe.

Another example of a successful consortium is the Five Colleges of Ohio: Oberlin College, Ohio Wesleyan University, Kenyon College, College of Wooster and Denison University. This collaboration helps colleges share resources and expand educational opportunities for students.

Advantages of consortia

Firstly, strategic alliances allow for risk sharing and cost reduction in the implementation of large projects through joint efforts. This also facilitates entry into new markets and expansion of the geographical presence of consortium members.

Secondly, consortia provide significant economic benefits. By sharing infrastructure, technology and operating costs, consortia allow for economies of scale. Collaboration also facilitates the exchange of ideas and research, which stimulates innovation.