The Case of Sumitomo Chemical: Nets and holes in Global Inclusive Business Systems

Christina Tewes-Gradl recently published a blog on Business Fights Poverty chronicling the case of Sumitomo Chemicals, who in 2004 leased a technology for producing long-lasting insecticide treated mosquito nets (LLINs) free of charge to local manufacturer A to Z Textiles.

By 2006, over 3,000 jobs had been created. The high demand was caused mainly by an unprecedented amount of international funding and political agenda dedicated to malaria control. However, when the Global Fund, a conglomerate of organizations, stopped ordering nets, A to Z’s market ceased to exist. Resource constraints, the goals of the coverage campaign having been widely achieved, and lack of local market threatened to shut down the company or downsize it considerably.

As illustrated in this case, the health market is an example of a heavily politicized one, making the need to consider the entirety of the ecosystem critical in business development. By showing that technology transfers and capacity building work, companies can make the case to public agencies to support similar initiatives. Endeva’s Bringing Medicines to Low-Income Markets report, published in 2012, introduced the 4As+1 framework as a tool for accomplishing a more ecosystem-minded approach to business.

Read more about this case, the wider implications for companies and development organizations, and the current status of Sumitomo Chemical on the Business Fights Poverty blog.