BCtA Partner Perspectives on Emerging Trends and Top Priorities in the World of Inclusive Business

Agenda 2030 constitutes a new framework, an increase in the ambition for a sustainable development. It necessitates new partnerships, more resources, new, innovative approaches and solutions to global challenges such as poverty and climate change. Solutions must always be owned and driven by those actors that are locally established in the actual development context to be relevant and sustainable.

Private businesses, investment and innovation are key drivers for productivity, including for economic growth and job creation. The private sector – comprising everything from small businesses and social entrepreneurs to cooperatives and multinational companies – is a crucial actor in the implementation of Agenda 2030, and for investments in areas critical for sustainable development, such as the transition to more sustainable consumption and production patterns. The private sector can bring knowledge, reach, an ability to innovate and perspectives that are different to those of traditional development actors.

Sida, therefore, engages with the private sector as one development actor, initiates and facilitates new partnerships and works catalytically to mobilise engagement for Agenda 2030. The private sector contributes with financing and other resources, know-how, innovation capabilities and solutions to meet the sustainable development goals.

Sweden’s development cooperation is governed by strategies on global, regional and bilateral levels. One of the global strategies is particularly focusing on cooperation and partnerships including with the private sector. This strategy also supports increased access to and implementation of innovative forms of cooperation and financing methods to, for example, create better conditions for increased financial flows and financing to developing countries.

How does Sida stimulate innovation within its private sector programmes?

Sida has developed a range of innovative approaches to enable the private sector to have greater positive impact on sustainable development:

• Challenge funds is a competitive mechanism to source and support the development of innovative solutions/business models from proof of concept to transition to scale, in order to address development challenges.

• Public-private development partnerships are projects where Sida and actors from the private sector cooperate and jointly finance an initiative, implemented by a third party, that seeks to improve the lives of people living in poverty.

• Guarantees are used for impact investors and crowdfunding platforms to enable investments in entrepreneurs with solutions in the transition-to-scale phase.

For example, Sida’s challenge funds have supported hundreds of enterprises and innovations, with more than SEK 2bn invested since 2007, supporting innovation in areas such as agriculture, energy, digital technologies, women economic empowerment and inclusive business models. A recently published evaluation reviews the success factors and areas for improvement: evaluation and brief.

Sweden is the highest per capita contributor to the Green Climate Fund and to the Global Environment Facility. What role do you see inclusive business playing in building resilience to environmental shocks in climate-sensitive countries and communities, and how is Sida supporting this?

The adoption in 2015 of Agenda 2030, the Paris Agreement, the Sendai Framework and the Addis Ababa Action Agenda signalled a coherent international vision of sustainable development.

In response, we have strengthened our environment and climate change policy, action plan and quantitative targets on climate change for the 2017-2020 period, with very high ambitions on tackling the effects of climate change. We are clear with our intentions to support a development that enables us to stay below 2C and support vulnerable countries to adapt to the impacts of climate change, and to stay with their commitments.

We know that financial crises hit vulnerable groups who are unable to build buffers and resilience. These groups also tend to be the most vulnerable to climate change. Building resilience in communities exposed to shocks, be it environmental, weather related or economic, requires multiple approaches. On the one hand, we support the national capacity to reduce the risk of disasters, improve education and skills development, and increase access to tenure and basic services. Through our support, we aim to strengthen vulnerable groups by providing them with power and voice, regardless of if they are involved in inclusive business operations or not. On the other hand, we target programs on business skills, financial inclusion and dedicated innovations funds, such as challenge funds that help stimulate business models towards climate resilience. As an example, Sida has contributed to the rapidly expanding market of affordable solar products, including pay-as-you-go systems.

Sweden is also leading the way on gender equality – it was the first country to implement a feminist foreign policy in 2014. How does this policy contribute to Sida’s development agenda and encourage a broader set of actors to engage in gender-sensitive inclusive business activities?

The feminist foreign policy paved the way for a greater emphasis on the role of women in development and the gains, and losses, in not engaging women in the endeavour. In practice it means that the whole Swedish foreign service applies a systematic gender perspective in all operations, uses its foreign policy tools to promote gender equality and to advance foreign policy objectives. It can be summarised in three Rs:

• Rights and respect for human rights and the rule of law constitutes a central role in every discussion on gender. This includes the promotion of the full enjoyment of human rights by all women and girls, including combating all forms of violence and discrimination that restrict their freedom of action.

• Representation, which includes influence over agenda setting and starts by asking a simple question: who conducts policy? Sweden shall promote women’s participation and influence in decision making at all levels and in all areas.

• Resources highlight equal rights to available resources. Sweden is committed to allocate resources to promote gender equality and equal opportunities for all women and girls to enjoy human rights.