Inclusive business models offer relief for ASEAN businesses hit by COVID-19
The Third ASEAN Inclusive Business Summit convened today with government officials and business leaders advocating for inclusive business strategies that support micro, small and medium-sized enterprises (MSMEs) to recover from economic setbacks during the COVID-19 pandemic in the South-East Asia region. The region already faced an ambitious challenge to reach its SDG targets by 2030 – there are concerns that this may be moving even further out of reach.
Organized by the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), the Inclusive Business Action Network (iBAN) and the Organisation for Economic Co-operation and Development (OECD), the Summit marked the continued commitment of the ASEAN Community, including government representatives, the private sector, investors and development organizations, to create an enabling ecosystem for inclusive business.
“As countries look to build back better from the COVID-19 pandemic – including by supporting small and medium enterprises, promoting women’s economic empowerment and accelerating the digital transformation – inclusive businesses have the potential to be a driving force for transformation towards a green, inclusive and resilient ASEAN,” said ESCAP Deputy Executive Secretary Mr. Kaveh Zahedi in his opening remarks.
The Summit also introduced the Guidelines for the Promotion of Inclusive Business in ASEAN and explored its practical application on a national and regional level. The Guidelines were endorsed by the ASEAN Economic Ministers (AEM) during the 52nd AEM Meeting in August 2020 and serve as an outline on how inclusive businesses can be supported at all levels and the institutional requirements to do so.
“The inclusive business model compels us to connect the dynamics between the government, private sector and low-income and poor communities, including the micro and small enterprises in achieving national and regional objectives. The Guidelines provide a greater understanding of these dynamics for ASEAN Member States and the region collectively to move on to consider integrating inclusive business in their national and regional policies,” said Mr. Bountheung Douangsavanh, Chair of the ASEAN Coordinating Committee on Micro, Small and Medium Enterprises (ACCMSME).
As the sectoral body coordinating MSME development in the region, the ACCMSME, with the support of ESCAP, iBAN and OECD has been at the forefront of promoting the inclusive business model in ASEAN and advocating its alignment with the MSME-development policies. The Guidelines for the Promotion of Inclusive Business in ASEAN is a culmination of past initiatives, building on interactions and lessons learnt since 2018.
Leveraging the wealth of expertise in the region, the Summit also explored partnerships in knowledge, digital platforms, investments and facilitation that enable the growth of inclusive business in ASEAN and their social impact. As business leaders and governments make progress in promoting inclusive business, delegates discussed how they can work together to address the challenges posed by COVID-19 and how women, overrepresented among the poor, can be better included in value chains as well as the role of social enterprises contributing to inclusive business models.
“The current crisis shows us that inclusive businesses are more resilient against such external shocks and contribute to a speedy and sustainable recovery. It is therefore of utmost importance that the framework conditions for such businesses are being improved and companies are being encouraged to develop their business model in a direction that not only serves the needs of the company but also the needs of the most vulnerable and poor in the communities,” said Mr. Christian Jahn, Executive Director, iBAN.
Inclusive businesses provide goods, services, and livelihoods on a commercially viable basis, to people living at the base of the pyramid making them part of the value chain of companies as suppliers, distributors, retailers, or customers. Since 2017, ASEAN governments have started developing policies to encourage more inclusive businesses to emerge and scale up. At the same time, business leaders, the finance community and other stakeholders have stepped up to the task of developing inclusive business models for economic growth and social impact at scale.
“Recovering from the COVID-19 crisis will require a whole-of-society effort. Working hand in hand with governments and all stakeholders, businesses can contribute to a recovery that is sustainable, resilient and inclusive by embracing business models and taking operational decisions that are in line with international recommendations on responsible business conduct,” shared Ms. Cristina Tebar Less, Head of Responsible Business Conduct Centre, OECD.
Read the Guidelines for the Promotion of Inclusive Business in ASEAN: https://asean.org/storage/2020/09/ASEAN-IB-Promotion-Guidelines-Endorsed-at-the-52nd-AEM.pdf.