Most projects fail for boring reasons.
Not for lack of brains.
Not for lack of money.
For lack of aligned incentives.

Boring, because they repeat over and over.

We write 300 pages of clauses.

Pay great sums to lawyers working with the best views and more expensive offices.

Then we hope.
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And hope is not a control.

You want performance?
Make winning for them the same as winning for you.
Make losing for them the same as losing for you.

Simple.

Brutal.

Fair.

In PPPs, I’ve seen both worlds.

World A: “Punish them into excellence.”
Endless deductions. Gotcha KPIs. Micromanagement disguised as accountability.
Outcome: defensive contractors, fat bids, creative claims, public outrage. Everyone loses, slowly.

World B: “Pay them to over-deliver.”
Tight KPIs that matter. Fewer, sharper.
Bonuses for durability, uptime, real outcomes.
Transparent pain share. Real step-in rights.
Outcome: better assets, faster fixes, lower life-cycle cost. Everyone wins, visibly.

Rules I refuse to negotiate:

1. No orphan risk. If someone can dump risk without cost, they will.
2. No fake KPIs. If you can’t measure it and track it in 5 min, it’s theatre.
3. Bonus before penalty. Humans chase carrots more than they flee sticks.
4. Fast feedback. Monthly is late. Quarterly is dead.
5. Data in the light. Hidden spreadsheets = hidden problems.

If you’re the public client: stop pretending you can “inspect quality into” a project. You can’t.
If you’re the private partner: stop hiding behind “commercial in confidence” when things go south. Share data, or pay up.
If you’re the lender: step-in should protect value, not freeze the asset to death.

One clause I'd love to see in projects: Aligned Upside Mechanism (AUM):

• 70% of base fee tied to must-hit outcomes (availability, safety, response times).
• 30% variable, unlocked only if whole-life costs beat the baseline and/or users/customers rate the asset >X/10 for Y months.
• Pain/gain shared on audited O&M, and why not energy savings?
• Data feeds owned jointly. No black boxes. Ever.

This clause could change behavior in week one.
Because money talks.

And spreadsheets don’t lie (when everyone can read them).

You don’t need a nicer contract.
You need a contract that makes misalignment too expensive to attempt.

Skin in the game.

Or get out.

Try the link below for more insights.

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