Inclusive Business – Part II
By Will Nielsen
With editing by Drew Tulchin
In part I, here, we explored the emerging term, Inclusive Business and saw international examples and cases. But, what does inclusive business mean to you and how does it impact your world? Regardless of whether you work for a business or not, such opportunities are everywhere and the philosophy can be applied widely.
Relevant to you
This model may seem to be a tool more relevant for lower income countries. However, many aspects are worth considering in developed countries like the U.S. The inclusive philosophy does not refer solely to including all economic classes, but also genders, races, disabilities, religions, and geographic areas, among others.
Excluded communities can be found everywhere, despite having the potential to provide significant value. . In Southwest Yonkers, New York, Greyston Bakery operates with an open hiring policy, giving anyone the chance to be hired, regardless of background. New hires go through an apprenticeship period, learning baking and employment skills. This training and employment provides the resources to help lift people out of poverty and drive community development. In 2014, Greyston Bakery had 144 employees, 48 of them new hires, with 3,358 hours of training provided.
While the lack of access to services and markets may not be as extreme in a place like the U.S. compared to say Amazonian Brazil, it still appears in various forms. Food deserts (an area that has little access to affordable, healthy food options) are a common example in the U.S., currently tracked and mapped by the USDA. For example, the community of West Oakland, California, with 25,000 residents, has been a long time food desert with no existing full-service grocery stores. People’s Community Market addresses this issue (opens 2017), providing residents easy access to fresh foods and affordable groceries as well as keeping more spending and jobs local rather than leaving for neighboring communities.
Internet access has also become a prominent subject in the U.S. affecting both rural and urban residents. About 20% of Americans do not have a mobile data plan or broadband at home due to the high cost of the service or because of where they live. This limits the ability to do increasingly common online tasks like homework and job applications. Companies such as Sprint, Facebook and Comcast each have initiatives to make internet more accessible. In the area of high-speed internet, the FCC reports that 53% of rural Americans have no access. This can quickly restrict any internet based business opportunities in these areas. In response, the USDA provides financial incentives to rural service providers that invest in broadband access.
The takeaway? Opportunities to take a more inclusive business approach may be closer than imagined. As you look ahead to 2017, will you be watching for opportunities? What will you do in 2017 to live this philosophy?
Inclusive Business supports Sustainable Growth
Inclusive business must, by its nature, promote sustainable growth in order to protect the value that they have helped foster. Any form of exclusion, unintentional or otherwise, leads to reduced growth potential, with unequal access to markets leading to reduced human capital gains (i.e. knowledge, skills) and productivity, plus the eventual stagnating growth. In other words, exclusion promotes growing social divides, class warfare, racial inequities, and so on.
Without the inclusive agenda, the formation of ‘dual economies’, the coexistence of a high wage, technologically advanced sector and a low-wage, low productivity sector, will be more likely to develop or become further ingrained. This limits growth potential while cutting off large populations from achieving higher standards of living.
Traditional examples of this phenomenon look to developing countries where huge inequalities are found between subsistence farmers and the globally connected urban markets. However, the term has proven relevant in high income countries as well, such as the US, where inequalities are expanding and an individual’s movement from the low wage sector to the high wage finance, technology and electronics sectors becomes increasingly difficult.
The opportunity to take a more inclusive approach may be closer than imagined. It does not require a particularly innovative business model. In many cases it can be a tweak to the many successful, sustainably oriented models that already exist elsewhere. While inclusive business is not the answer to all problems nor has the concept itself been perfected, I hope this discussion might encourage a revisiting of business models to look for opportunities to incorporate it.
In the end, implementing this philosophy will support sustainable growth, expand business opportunities, mitigate the dual economy threat, and improve the well-being of people previously excluded or struggling to gain access to market opportunities.
Looking for More Information?
There is a wealth of information on the Practitioner Hub for Inclusive Business or the Business Call to Action webpage, an alliance amongst several major donor governments and the UNDP. Recent policy developments and case studies also appear on the G20’s Global Platform on Inclusive Business. In the US, the Social Enterprise Alliance is a network of social enterprises, many of whom follow an inclusive business philosophy, and which publishes a range of relevant resources.
About the author
Will Nielsen first worked as a summer intern for UpSpring in 2013 and has continued to follow and support their work since. Following his internship, Will received his MPA from Cornell University and now works as an independent consultant.
Email Will: Win5@cornell.edu