Conducting inclusive business – or any business – can be like entering murky waters when policies are not supportive of that type of activity. Businesses entering a new market require good information and fair market conditions. Prohibitively high import duties, for example, can hamper or make impossible a company’s efforts to do business.
The role of policy in inclusive business was the topic of a recent panel discussion and report presentation at the Hertie School of Governance in Berlin. Christina Gradl and Anna Peters presented the results of Endeva’s report, “Inclusive Business Policies: How Governments can Engage Companies in Meeting Development Goals,” which includes a toolbox that enables policymakers to systematically review options for supporting linkages between companies and the poor. The toolbox is structured along four different types of policy instruments, (1) providing and sharing information, (2) setting and enforcing rules, (3) levying and granting financial resources, and (4) employing a government’s structures and capacities. The audience, who ranged from embassy representatives to the private sector, and students to government officials, identified rules and financial resources as the hurdles they saw as most significant in dealing with inclusive business policy.
A panel discussion followed, moderated by Christina Gradl. The panellists (listed below) identified several points. For the private sector representative, from the solar company Little Sun, the most important support came from having someone to explain the landscape of the market as they were coming in, and to have a stable business environment. The representatives from the Embassies of Madagascar and Mauritius also shared their experience in successful policy, stating that crucial was good collaboration between government and the private sector, and on the other side, providing information to the poor that certain goods and services were available. The BMZ urged governments to embrace companies where they work well, and to provide quality information, and to keep a long-term perspective on policies. In the long run, certain policies may pay off despite higher up front costs at the onset.
The panellists were also asked about the future of policy for inclusive business. Conclusions to this question strongly favoured a continuous dialogue amongst all smallholders and smart programs that support populations. Market-skewing actions, such as subsidies, should also be approached with caution to avoid inefficiencies.
This event was held on May 15. Panellists included Susanne Dorasil, Federal Ministry for Economic Cooperation and Development (BMZ); Felix Hallwachs, Director, Little Sun; Anke Hassel, Hertie School of Governance; Elsa Rajemison, Counsellor for Economic Affairs, Embassy of the Republic of Madagascar; and H.E. Ambassador Sarojini Seeneevassen-Frers, Embassy of the Republic Mauritius. For more information on this study, please click here.