Businesses have played a crucial role in economic growth and employment generation, and they have been one of the main drivers of innovation and technology. The question is how such powers can be harnessed in an inclusive way to contribute to delivering the SDGs.
However, the emerging phenomenon of Inclusive Business offers a potentially new opportunity to harness the innovation potential of enterprise to address the problems of lower-income communities. Inclusion through business is an area of crucial importance. Business has the potential to be a catalyst and accelerator of SDGs around the globe. Inclusive business can lead to creating new employment and entrepreneurship opportunities for underserved communities, either in a direct way or by including the communities in the businesses’ value chains as suppliers, distributors and retailers. More over, private sector can untap their innovation power to develop products and services that address the unmet needs of the communities in areas such as healthcare, nutrition, water, sanitation and housing. They can also develop innovative business models to provide better access to important development enablers such as communication technologies, energy, insurance and finance.
The examples of inclusive business initiatives that are now beginning to emerge are showing that it is possible to overcome the many constraints in their environments and create value for the poor, for the enterprise and for other stakeholders while protecting the natural environment. In many cases, governments and other organizations play a facilitating role.
Higher-income markets, despite their smaller population in a global comparison to low-income markets, have been the most attractive marketplace for large corporations. Consequently a large part of the world population with lower income levels, has been ignored as an attractive market by both multinational corporations and large domestic companies. Often these markets have been addressed by selling older products and obsolete technologies that are no longer profitable in the mainstream market of large companies. Generally speaking, there has been very limited attention in terms of corporate innovation to address such communities. The lower purchasing power of these markets and infrastructure issues were commonly considered as major problems that made it very unattractive for companies to invest heavily into these markets. Fact is, however, that more than two thirds of the world population resides in the lower-income tier of the world economic pyramid (also known as the Base/Bottom of the Pyramid - BOP). Despite the fact that the size of these markets is much larger than the markets at the top of the economic pyramid, there are still only very few products and services developed particularly to satisfy the specific needs of the users in the base of the pyramid.
On the other hand, businesses firms foster their long-term growth by profiting from the opportunities in low-income markets. Apart from the enormous size of the BOP market, it is also argued that by being engaged in BOP markets, multinationals can learn about important capabilities, practices and innovations that could be transferable to their higher-income markets.
The lack of sufficient managerial and financial resources tend to make it difficult for them to diffuse, replicate and scale-up their solutions. Aid and philanthropy approaches often face limitations in terms of scale and sustainability. A new trend is emerging among public sector institutions and non-profit organizations to adopt private sector management principles.
If market-based approaches are going to bring mutual benefits for both private sector and low-income
communities, there is a need for a deeper understanding about the characteristics of these communities and find out how those understandings can be translated into sound strategies.
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9. STI and Participation for Sustained Development
Leading people to become technological protagonists rather than just spectators. Revolution 4.0 have more impact when it is build by communities themselves ». Exceptional people committed to local causes in service to isolated and marginalized populations. A first step to ensuring women and other marginal groups benefit from any innovation is recognition that scientific solutions are not neutral in their ability to reduce individual risk.
This raises the question of how best to ensure the inclusion of women within ongoing sustainable development programmes in a way that ensures they are served by these programmes, rather than being at the service of them.
The answer to big challenges such as climate change may lie with a woman, but we will not know if that woman as a girl was not allowed to attend school or to stay on to secondary school, did not feel able to study science at university or to raise her voice in research team meetings. In short, we are missing the innovative thinking and possible technological solutions that half the world’s population could provide.
10. STI and Regulatory Framework for Sustained Development
Legislative and regulatory incentives for ‘patient’ capital, particularly to be invested through appropriate partnerships in lower income countries. Universities and public research organizations to transfer technologies to companies. All of the revenue from transfer can be kept by universities and public research organizations. The Law could also stipulates that no less than 20% of the revenue from the transfer should be paid to inventors as compensation. Following the amendment of the Law, many universities and public research organizations give even 70% of the revenue from technology transfer to the inventor team. Before the amendment, price negotiation was not allowed in patent sale negotiation. Sale price of a patent could only be determined in auction, which takes a much more time. After the amendment of the Law, price negotiation is allowed under the condition that the price needs to be disclosed to public.
The government provided assistance in financing, through government-controlled banks, and preferential treatment in strategic projects. In turn, the big companies would work with small-to-midsize companies as their subcontractors and collaborative companies, so that economic benefits coming from the export-driven activities of the conglomerate companies can be shared, or at least trickle down in the form of employment and contracts.
Close ties between the government and big companies have degenerated into corruptive relationship involving slush funds and bribery between the policymakers and businesses that hampered the further growth and caused political scandals well into the 21st century.
10% of research contracts and 50% of future royalties are intended to be reinvested in biodiversity preservation.
Other initiatives in the region have not fulfilled their promise, mainly due to the lack of applicable legislation and stakeholder reward schemes, which would effectively reward the country for accessing its sovereign genetic resources and pay back custodian populations for their traditional knowledge. To this day, the lack of practical lawful schemes enabling access to resources still limits the production of scientific research and the subsequent use of potentially valuable resources.
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