17 July 2015

Reflections on the UN Financing for Development Conference in Addis

http://www.un.org/esa/ffd/ffd3/wp-content/uploads/sites/2/2015/04/FfD_Logo-140.pngThis week over 7000 participants from all over the world gathered in Addis Ababa, Ethiopia, for the Third International Conference on Finance for Development (FFD). Someone called it the biggest conference having been held in Africa ever. Certainly, Addis was in 'FFD-fever', hotel prices skyrocketed and conference rooms were overfilled.

On 13 July 2015 the UN Secretary-General Ban opened the gathering with the challenge: 'World leaders must put aside "narrow self-interest" to break a deadlock over how to finance the United Nation's bold new global development agenda'.

While the official, governmental discussions continued in the main conference rooms, over 200 side events were held. International organizations, governments, private sector, civil society and academia shared their perspectives.

After days of negotiations delegates agreed on an outcome document. A UN statement praised it as historic agreement to generate financing for the new sustainable development agenda. Ban summarized: "The Addis Ababa Action Agenda is a major step forward in building a world of prosperity and dignity for all.”

There are already several good summaries done on the outcome, such as from the UN, UNDP, ODI, the Guardian and Devex. Therefore I don't want to add another substance analysis but did a small innovation. How to get the essence of the outcome document with over 130 articles? Out of curiosity, I did a word count of key works and a 'wordle':

302x development
251x countries,
214x finance/financial/financing,
155x sustainable,
77x investment,
63x debt,
59x cooperation,
53x trade,
52x technology,
35x tax
34x infrastructure,
28x partnership.
"The UN was not created to take mankind to heaven, but to save humanity from hell."— Dag Hammarskjöld, fromer UN Secretary-General
Personally to me, FFD3 was a demonstration that the UN and it's processes remain relevant and critically important. Who else could bring together officials from 193 countries with all types of stakeholders from society and business? Who else can facilitate global dialogue on most complex issues?

Is this sufficient to solve the world problems? Of course not. It will take even greater ambition, leadership and self responsibility by everyone to translate aspirations into reality. The new sustainable development goals (SDGs), to be signed off in September at a special UN summit, will be a new shared ambition of global leaders to make sustainable development a reality.

05 June 2015

This Blog is transforming - towards Changemakers and Leadership
"We must look within ourselves..." Nelson Mandela

After more than 8 years as a blog focused on "business as a force for good", this blog is transforming.

Mirroring my own personal and professional development, it is time to look beyond business. Yes, business is a major force for change and development. So what force then, is stronger? People. Changemakers and leaders. You don't need a title to be a leader.

Each person is a CEO, each of us a boss. Aware of it or not, each of us is the boss of our own life. This translates to greater self-responsibility and self-power. If one is less aware of this fact, they might not see themselves as the creator of their own destiny, but rather consider themselves as a consequence of their circumstances, upbringing, interactions with other people, etc… but that is only part of the 'story', at best.

There is increasing awareness that each of us is indeed THE change agent in our life. This relates back to leadership since at the core, we first lead our own life before we lead those of others. Because how can you authentically lead others if not by example?

Long story short, transformational leadership and self-empowering approaches have captured my imagination. I myself have seen the transformational changes that insights and breakthroughs from within can cause. I have also seen the non-effectiveness and lack of sustainability of superficial 'outside' aid.

Two examples, one from the the UN and the other about aid vs. self-development:
1) I have seen UN colleagues overcome deep frustration and blossom at work, after participating in a transformational leadership program. 2) Or take Youchaou Traore from Mali, who was this tree child and became an entrepreneur, a school and NGO director due to his passion, perseverance and can-do attitude. Those opportunities were not afforded to him otherwise.

Therefore, the Business4Good blog is going into hibernation. Something new about transformational leadership is going to arise... as a butterfly does from a caterpillar.

19 June 2014

Africa is on the move - Transforming itself - How to put the Intentions into Reality?

Africa is on the move - Transforming itself
Last week I attended the Global Compact events hosted in Addis Ababa, co-organized by UNDP AFIM and other UN agencies, entitled "Africa: Advancing Partnerships and Responsible Business Leadership". It was an interesting event - held for the first time in Africa - bringing over 300 participants together from business, Global Compact networks, UN and government.

One of the key topics was on the role of business in Africa's Economic Transformation which is a hot and complex topic. One of my key observations was that Africa is transforming itself, partnering with various actors from China, Europe, US etc... while multinational companies do play a role it is increasingly clear that it's African policy makers and business people in setting the continents own agenda. 

Inclusive Growth requires Jobs, Inclusive Business and Social Entrepreneurship
The new mantra that economists and development practitioners are reciting to tackle inequality and achieving development goals is "inclusive growth".  As UNDP's Eugene Owusu stated "inclusive growth needs to be job rich, and the private sector has a major role to play".

UNDP AFIM sees inclusive growth (macro) achieved by inclusive markets development (meso) and inclusive businesses (micro). Participants also mentioned social entrepreneurship and responsible investment - next to inclusive business - as key ingredients. "Jobs don't fall from heaven, they need to be created by responsible entrepreneurs" said UN Global Compact's Georg Kell.

Overall there is agreement that business needs to go well beyond philanthropy and CSR, towards making its core business better for societies and the environment. Owusu concluded that "responsible and inclusive business can transform poverty into prosperity for all." 

Transformation is much more than Growth
Africa is expected to be one of the world's fastest growing regions, with 4.8 percent growth in 2014 and over 5 percent in 2015, according to the recent African Economic Outlook 2014. However, while this transformation entails growth it goes well beyond it.

Transformation is much more fundamental and usually more leap-frogging and disruptive as incremental growth. The African Union Vision 2063 is an attempt to visualize how a continent with so much potential could transform itself. The jury is still out and to predict Africa's transformation requires more soul-searching and observing.

Addis Ababa, as Africa's diplomatic capital is an interesting example in this transformation process. People who visited it some year ago, hardly recognize the city with its tall buildings and all present construction sites including a new light rail, ring roads and express way.

How to put the Intentions into Reality?
Most of the discussions were interesting with largely agreeing participants on what is needed (such as we need more and better infrastructure, education, skills, infrastructure, jobs, policies etc...). The WHAT was well articulated but less the HOW.

So this question of the moderator Peter Ndoro (SABC) resonated with me: "How do we turn intentions into practice?". Unfortunately this question came in the closing and I wish it to be a starting question for future meetings. Less wishful thinking but deeper reflections on getting to the core of making it happen.

What role does Attitude play?
A similar 'game-changing" question arose in a special session on education. UNICEF stated rightly that "education is not an expenditure but an investment". And the discussion continued with diagnosis of what is and what is needed.

Then one participant asked: "What role does attitude play?" Attitude of the educators, of the students, of the various people in the system. To me this question is going down the rabbit hole and would lead to real insight. I would add some more questions:
  1. What role does our thinking and awareness play? (as thinking leads to decisions and actions).
  2. What role do attitudes, aspirations, passion and 'inner' side? play (as inner creates the outer)
  3. How to see development more holistically, from personal to societal?
Let's take some young entrepreneurs as an example. Will they do better or worse with a "can-do" attitude? With being open-minded, self-motivated, passionate, pro-active, solution-seeking? (even if all other environmental and support factors would be the same). If so, then how can we empower people and entrepreneurs, how can mind-sets and inner attitudes be shifted? These dimensions do matter and can be developed if taken into account.

Otto Scharmer calls the 'inner' side our blind spot. Unless someone has tried meditation or a a similar practice it is a difficult topic for economists and development practitioners to grasp. But until we learn from the personal development, coaching and psychology fields, I feel we are scratching the surface and could do a much better job with a more holistic 'inside-out' development approach.
"Development is not something that we do for people. Development is what people do for themselves. It must start and end from within. Our job is to facilitate the process."
- IFAD President Kanayo F. Nwanze, Addis Ababa, May 2014

20 March 2014

Happy "International Day of Happiness" - book recommendation for Robert Muller, former UN leader

Happy International Day of Happiness! The UN General Assembly resolution 66/281 in 2012 proclaimed 20 March the International Day of Happiness recognizing the relevance of happiness and well-being as universal goals and aspirations in the lives of human beings around the world.

I have written in an earlier article why I agree that we urgently need an approach that aims at a higher goal rather materialistic 'wealth' in my blog on "Happiness as a UN goal? The Inside-Out Development Paradigm?". A happiness day can raise awareness with people and policy makers alike to explore more holistic approaches to human development.

"The world needs a new economic paradigm that recognizes the parity between the three pillars of sustainable development. Social, economic and environmental well-being are indivisible. Together they define gross global happiness.”
-UN Secretary General Ban Ki-moon 

One of the most inspiring books in this regard I have ever read is "Most of All, They Taught Me Happiness" by Robert Muller (here on Amazon). The book is a fascinating life story of an authentic person embodying the spirit and value of the UN. I therefore highly recommend it to anyone who wants to be inspired and learn about the UN's evolution.

Muller fought in WWII and developed a passion to overcome wars by uniting countries beyond borders. He first joined the UN as an intern and rose through the ranks over a 40 year career to become Assistant Secretary-General under three Secretary-General.

He was known by some as "the philosopher of the UN" and his ideas about world government, world peace and spirituality led to the increased representation of spirituality in the UN.  As a visionary leader he was instrumental in the founding of numerous UN agencies and programmes, including UNDP and WFP. Muller received numerous awards and was nominated repeated times for the Peace Nobel Price.

"Are you happy? Decide to be happy! Happiness is a state of mind, a conscious, determined decision or will to embrace with fascination, enthusiasm the entire world and creation. Happiness is total consciousness. Happiness is not external to man, it is a genial force in him, an attribute, an essence of the human person."
-Robert Muller, former UN leader

His legacy lives on in many inspired coworkers and people, and also in the UN University for Peace in Costa Rica whose first Chancellor he became after retirement. Muller furthermore documented over 7000 'idea-dreams' who are disseminated in a daily, inspiring newsletter (sign up here).

03 March 2014

Developing Transformative Leaders: 2014 programme open for registration

Interesting for all UN staff, consultants and Global Compact member companies working with the UN, is this "Transformative Leaders" 2014 Training Programme which I had the honour to co-create and also participate in last year.

I am delighted to invite you to engage in an exciting leadership programme being offered by the UN Transformation Network - a network of innovators and change makers in the UN system who want to transform the UN from within.  Last year, our first programme generated excellent feedback and so, due to its success, we want to build on the momentum and launch more sessions.  The practical skills I gained in communicating, inspiring others and leading in complex situations was especially impressive.  It helped me achieve my learning goals of leading positive change and innovation as well as connect with like-minded colleagues. 

The overall intention of this leadership programme is to build the skills and capacities of UN staff - at all levels - so as to increase personal effectiveness and to evolve the UN system to have greater impact and relevancy.  We hope to catalyze UN innovation and collaboration to enable colleagues to deliver even more powerful results in the field.  This is a transformative inside-out approach to development as we believe that leadership potential exists within everyone, regardless of role.  The time is now to harness our wisdom and creative intelligence because the sustainable solutions we seek reside within each of us. One of the best part of this course is being part of a bright, innovative and motivated group of peers who generated support for doing things differently.

As one participants from UNDP BDP said, "The course introduced us into a new world about transformation and leadership. It's not enough to have the motivation to be a leader or an innovator, you need the knowledge and skills to understand change, see how this plays out within organizational cultures and structures, and manage the processes to guide transformation. The course filled this vacuum." Another colleague from the Ethiopia Country Office said, "It gave me the confidence to speak up and the skill set take positive action."

Please note that there are both in-person and on-line cohorts and all UN agency staff and consultants are welcome to participate.  The NY session starts on April 3rd, the Geneva session starts on March 27th.  I am currently working on creating an in-person course for Addis Ababe in fall 2014, please email me in case your are interested.

For more details on this unique programme, please visit: http://transformative-leaders.org.  Feel free to pass this message onto other colleagues who may be interested. There are limited seats so I encourage you to take action!  Lastly, please consider joining our LinkedIn network group - the link is below.  We now have over 300 members world-wide, consisting of all UN stakeholders, and the conversation keeps growing.

Warm regards
UN Transformation Network (Co-leads: Patrick McNamara, Juergen Nagler, Elizabeth Soltis, Ian Thorpe)
Visit http://transformative-un-leaders.org
Join http://www.linkedin.com/groups?gid=4469347

PS: Thanks a lot to Patrick McNamara for drafting the brochure and excellent facilitation work, and to Elizabeth Soltis for inspiration and a lot of the text of this article.

17 January 2014

Business Fights Poverty (BFP) Interview

Business Fights Poverty 
Many thanks to Business Fights Poverty (BFP) for this Member of the Week Interview:

BFP: What do you do?

JN: UNDP AFIM is advancing inclusive business and market development in Africa. We bridge partnerships between public and private sectors and develop capacity along target value chains contributing to sustainable development and inclusive growth, especially through job creation and income generation.

For instance, we have undertaken regional Project Facilitation Platforms in East, West and Southern Africa advancing several key agri-food value chains such as sorghum, dairy, onion, mango, ground nuts and soy beans benefitting thousands of farmers and all value chain actors in each project.

Personally I focus on partnership building, communication, innovation and project coordination. AFIM has released several knowledge products including the major report “Realizing Africa’s Wealth – Building Inclusive Businesses for Shared Prosperity”.

BFP: What is the best part about your job?

JN: I love working within the United Nations with people from all nations to advance universal goals. Considering myself a ‘bridge-builder’, it’s a privilege to connect different stakeholder groups, learn from them and facilitate knowledge exchange.

This also allows me to be part of the paradigm shift in development approaches towards greater engagement of the private sector and enlightened business leaders to realize UN goals which links to my own work experiences from the business, NGO and UN worlds.

As UNDP is consulting with people from all over the world about the post-2015 development agenda, I am also very grateful to broaden my own development knowledge and philosophy. For instance, the UN General Assembly clearly recognized the need to go beyond measuring GDP as an indicator for a country’s wealth and calling “happiness” a more holistic approach to development.

BFP: What have been your greatest challenges? 

JN: Scope of demands and financial resource pressures have been the biggest challenges so far. As UNDP has a very broad global human development mandate it attracts very high expectations and demands from the widest set of stakeholders. Moreover, as some countries shifted focus on reviving their own economies UNDP has experienced challenging financial resource limitations.

BFP: How have you overcome these challenges?/  What advice, would you give to others?/ What is the secret of your success?

JN: A shared vision and positive attitude have helped me to overcome challenging times and to grow from self-employed entrepreneur to business manager and from UN intern to UNDP staff. My advice, even if it may sound philosophically, is to follow your heart and succeed in what one loves doing and is passionate about. Then one is able to work and lead not only hard but smart achieving transformative results.

For instance, I honorary also co-facilitate the UN Transformation Network which is a close to 300 members strong group of like-minded UN innovators, change-makers and thought leaders that are interested in advancing collaboration, innovation and transformation within the UN system and its work, hopefully leading to a future-ready UN 2.0.

Personally, I also see the importance of development happening “inside-out”, therefore inner work plays an important role in my life which includes personal development practices such as meditation. In many instances have I positively experienced that a shift in my inner attitude to a problem lead to an outer transformation - from a negative problem to a neutral challenge to a positive lesson learned.

BFP: If someone wants to do what you do, where should they start?

JN: There are many different ways to work at the cross-roads of business and advancing UN goals. For several years I have been sharing relevant stories and insights on my blog at www.business4good.org.

Companies increasingly shift from philanthropy and CSR to the next level, may it be called inclusive business, creating shared value or whatever the name. Leading firms join the UN Global Compact or the Business Call to Action, so these are good sources of inspiration.

NGOs also play an important role to bridge the ambitions of lead firms with realities on the ground, e.g. by mobilizing and building capacity of youth, women and farmers in rural areas which have been previously been out of reach for most companies.

The UN is a highly competitive place to enter and there is no substitute to the right education and experience. Internships and consultancies provide ways to gain UN experiences and to expose oneself to the organization and its work. There are also national recruitment assessments for some countries and it is key to monitor for suitable positions to apply online, e.g. directly at the relevant UN agency websites or through specific search engines such as unjobslist.org.

BFP: Finally: what do you hope to get out of being part of the BFP community?

JN: I appreciate the platform for sharing knowledge and experiences, not only to fight poverty but to advance shared prosperity and sustainability. Therefore, it’s great to connect with like-minded people, share stories and together bridge the power of business for the greater good.

Source: Business Fights Poverty

UN Global Compact Leaders Summit & Muhammad Yunus

Some months ago I had the privilege to attend the UN Global Compact Leaders Summit 2013 in New York. This major even, happening only every three years brought together 1,200 participants making it the largest UN business meeting.

Chaired by UN Secretary-General Ban Ki-moon, chief executives met with leaders from civil society, Government and the United Nations to unveil the Business Engagement Architecture to align and scale up business action in support of sustainable development priorities.
"The Global Compact has helped generate a major shift in corporate mindset in just one decade. Enlightened leaders are making sustainability a core part of business strategy. Today, I ask you to be architects of a better world. What was once a call to the founding members of the United Nations is now a rallying cry to business and civil society leaders everywhere. Help us to respond to the urgency of our global challenges and build a better tomorrow".
- H.E. Ban Ki-Moon, United Nations Secretary-General
It has has been the third Summit I have been able to attend and these major events have gone from strength to strength. Recently, the summary report has been published and is worth a read as it outlines the global Corporate Sustainability agenda for years to come. Read the summary report.

A personal highlight was the encounter with Nobel Peace Prize Winner Muhammad Yunus. He has been a true inspiration for many years, firstly for pioneering microfinance, followed by his work on the social business concept. His perspective that humans not only interact as economic agents maximizing their own utility but also as social beings seeking happiness is playing an increasingly important role.

18 August 2013

Happiness as a UN goal? The Inside-Out Development Paradigm?

Are we seeing a new, more holistic human development paradigm emerging? Can happiness be a UN goal? There are some interesting signs...

Since the UN General Assembly declared 20 March the International Day of Happiness in 2012 the idea of happiness as a goal for development and global well-being has gained even more traction. Discussions advance happiness not just as a personal matter but also a global development goal.

UN Secretary General Ban Ki-moon is personally very interested in the new development paradigm including global well-being, happiness and Bhutan's Gross National Happiness (GNH) index. The 2013 UN General Assembly Note called "Happiness: towards a holistic approach to development" gives a clear recognition of broader measurement of development beyond GDP and a call to further action.

Recently and during my holidays in Germany, I attended the first 'Global Well-being Lab Forum' in Berlin. It was organized by Germany's GIZ Global Leadership Academy (commissioned by the German Federal Ministry for Economic Cooperation and Development (BMZ)), the Presencing Institute and the GNH Bhutan Centre with OECD, Italy, Finland, World Bank Institute et al. also being active.

See a key diagram by Enrico Giovannini, former OECD economist pioneer, mapping the links between needs, skills, forms of capital, well-being and happiness with the new development paradigm (see also at the bottom the resource library giving an overview of other initiatives presented).

For me personally very interesting is that this new development paradigm seems neither top-down nor bottom-up but 'inside-out'. A key insight that I heard from both the Bhutanese monks at the forum but also Otto Scharmer, Founder of the Presencing Institute, is that "transformation has first to happen inside oneself, then it manifests outside".

This new field appears to be an exciting, innovative approach promising transformative impact and contributing to the realization of long-term development goals for all. Are we seeing a new development paradigm 'happiness' emerging?
At the moment this space is still relatively new and much more research is needed to make the new approach practical. Given my strong personal passion for the topic, I am considering to explore this new development paradigm through an action-oriented PhD thesis with a German university while continuing my work for the UN.

Key part of the initiative would be to interview global change-makers and transformative leaders to synthesize insights on realizing the new emerging development paradigm, from theory to reality, within the UN context. What about the title 'transformateurs'? Suggestions for interviewees?

For further information see also the very informative resource library by Stefan Bergheim, Centre for Societal Progress. Looking forward to hearing from you.

04 August 2013

Live TV Interview on Inclusive Business in Africa - UNDP Kenya Report Launch

Is the business & development paradigm changing? Last week I had the honor to travel again to Kenya to present on the key findings of the major UNDP AFIM report “Realizing Africa’s Wealth – Building Inclusive Businesses for Shared Prosperity”.

The launch event in Nairobi on 31st July 2013 brought together around 100 leaders of private and public sector, media and academia. Together with the presentation and panel discussions, my personal highlight was the Live TV interview for Kenyan national TV station KTN. Watch the 4 minute video here:

It was great to discuss with private sector companies such as Novartis, development partners (DFID, Sweden, Denmark), government representatives, media and UNDP Kenya colleagues the concept and successful cases of inclusive business models in Africa.

Kenya is such a hotbed for business innovation and together with South Africa has the most inclusive business models as identified in the report. Most cases are in agriculture, financial services, ICT, energy, water and extractive industries. Read the report for more details.

Below a photo with key representatives including UNDP Kenya Country Director Maria-Threase Keating (middle), Inclusive Economic Growth Team Leader Carolin Averbeck (2nd left) ) and Business Call to Action representatives Karen Newman (left) and PanAAC CEO Lucy Muchoki (right):

Personally I see Inclusive Business demonstrating that good business does well by taking a more holistic and long-term perspective with a shared value and triple bottom line approach of social, environmental and financial dimensions.

This goes hand in hand with the current paradigm shift in development cooperation from traditional aid towards greater individual empowerment, self-responsibility, local ownership and business engagement leading to more inclusive markets and sustainable development.

For more follow also on Twitter: www.twitter.com/Business4Good and www.twitter.com/UNDP_AFIM

08 March 2013

Inclusive Business can transform Poverty into Prosperity

Inclusive Business can transform Poverty into Prosperity:
Experiences by UNDP’s African Facility for Inclusive Markets (AFIM)
Jürgen Nagler, Programme Specialist
United Nations Development Programme (UNDP)

The need for inclusive growth and inclusive market development
Economic growth, which is essential for development, is largely driven by the private sector – from micro, small and medium-sized enterprises to multinational corporations. Six of the ten fastest-growing economies in the world over the past decade are in Africa, and the overall GDP growth rate of sub-Saharan Africa is expected to reach 5.4 per cent in 2013, making it the fastest-growing region in the world.[i] However, Africa’s impressive recent economic growth has been largely ‘jobless’ growth and has failed to provide job and income opportunities for the majority on the continent. 

Woman in FieldTherefore, inclusive growth must address the phenomenon of ‘jobless’ growth and must tackle critical issues to create inclusive employment and income-generating opportunities for the majority in Africa. Jobs are first and foremost created in the private sector, and as Helen Clark, the head of the United Nations Development Programme (UNDP), states: “Businesses are engines of growth and have the potential to help improve the lives of people through their investments and activities.”

The landscape of global human development and official development assistance is changing rapidly. Especially, the area of engaging and partnering with the private sector has received a significant increase of interest over the recent years, as recently embodied in discussions at the Busan Forum for Aid Effectiveness[ii] and the statement issued by 11 of the world's largest bilateral donor agencies.[iii]

There is a paradigm shift from traditional aid to sustainable development, from official assistance focusing on governments to the inclusion of the private sector with its core business. This stresses the importance of inspiring the private sector to use inclusive business models, and governments and development partners to develop inclusive markets.

The UNDP’s Inclusive Market Development (IMD) approach
The UNDP has been a leading agency in promoting private sector partnerships and inclusive market development through projects and initiatives such as the Growing Sustainable Business (GSB) initiative which started 2003. The UNDP´s ambition is to foster broader and more strategic alliances with the private sector around key development challenges of common concern, such as the provision of energy, job creation and supporting green growth.

IMD focuses on developing private sector markets to make them more inclusive of and beneficial to low-income groups as producers, consumers and employees. Specifically, IMD seeks to strengthen value chains to empower small enterprises, producers and distributors to participate in and benefit from the existing and potential markets in which they do business.[iv]

The UNDP’s global private sector strategy for IMD combines private sector development and private sector engagement.[v] The objective is to stimulate the sustainable economic growth that creates jobs and thereby reduces poverty – primarily by ensuring that small enterprise owners and their employees participate in the growth of expanding markets. The most frequently employed approach to IMD is the development of value chains with growth, job and income generation potential.

IMD is a useful approach to employ when partnering with the private sector to inform, inspire and initiate inclusive business models and to integrate low-income populations into their value chains. To support IMD implementation, the UNDP published an IMD handbook and three related tools: Assessing Markets, Inclusive Business Models and Brokering Partnerships.[vi]

The power of inclusive business models and value chains
Inclusive business is a relatively new approach, encompassing those businesses that consciously include low-income people into their value chains as producers, consumers, employees and entrepreneurs. Such businesses are not only profitable, but also improve the lives of low-income people and communities. Therefore, it is key for scale and sustainability to engage the private sector as a strong partner, i.e. with their core business - beyond philanthropy and corporate social responsibility (CSR). 

In 2008, a global UNDP report noted that
inclusive businesses include low-income people on the demand side as clients and customers, and on the supply side as employees, producers and business owners at various points in the value chain. They build bridges between business and the poor for mutual benefit. The benefits from inclusive business models go beyond immediate profits and higher incomes. For business, they include driving innovations, building markets and strengthening supply chains. And for the poor, they include higher productivity, sustainable earnings and greater empowerment.[vii]

Inclusive business models by the private sector and supported by public sector and development partners, can turn poverty into prosperity. The UNDP promotes exactly such business models, where the pursuit of wealth creation, human development and environmental sustainability are seen as fully compatible.[viii] What can the private sector do to contribute to sustainable development? 

First, businesses can benefit low-income people by including them in their core business operations, whether as suppliers or business partners in their value chains, as employees in the workplace, or as consumers in the marketplace. There are many examples of companies which have successfully integrated low-income people into their business models. 

For example, A to Z Textile Mills of Tanzania is an African producer of long-lasting insecticide bed nets. Its products help in the fight against malaria, and the production provides work for more than 3000 women. This was made possible by a broad public–private partnership involving, among others, the Japanese chemical company Sumitomo, which is member of the UN Global Compact and the Business Call to Action (BCtA), a UNDP-supported initiative challenging companies to develop innovative business models.[ix]

Second, the private sector can make important contributions to advancing sustainable development by bringing low-cost innovations to market. The low-cost mobile technology exists to conduct life-saving heart scans; there are energy-efficient LED lamps which enable children to do their homework at night; there are smokeless stoves which support better health; and mobile phone and Internet applications which help small farmers and fishermen get access to better information and prices. 

One such innovative product solution in the agribusiness field comes from Amiran Kenya, which won the 2011 Youth Empowerment Millennium Development Goals (MDGs) award in Kenya. Amiran’s Farmers Kits offer local small-scale farmers affordable access to modern agricultural technologies, methods and inputs to suit the climate, terrain and agricultural experience of the farmer. Innovations like these, when accessible to low-income people, have the potential to significantly contribute to making markets more inclusive.     

Third and perhaps a more traditional way for businesses to support development goals, is giving back to the community through CSR activities and philanthropy. The scope and magnitude of these kinds of activities have grown exponentially in recent times – and indeed they need to be brought to scale more consistently, to have a wider and more sustainable impact. 

In conclusion, inclusive business models and inclusive value chains generate jobs, help low-income populations increase their productivity and income, and enable people to access affordable products and services. Several prominent examples show that this paradigm shift towards a new way of doing business is possible, and that it pays off in sectors as diverse as agriculture, healthcare and financial services. 

UNDP’s continental platform: The African Facility for Inclusive Markets (AFIM)
In November 2010, the UNDP launched the AFIM, specifically for Africa. This project constitutes a continental platform working in partnership with the public and private sectors, development partners and UN agencies in Africa. AFIM works to reduce poverty and accelerate progress towards sustainable development, by supporting inclusive growth and inclusive market development across sub-Saharan Africa.
The facility aims to achieve four main goals:
  1. Increase private sector-related capacity of targeted, regional institutions and governments;
  2. Strengthen regional and country-level initiatives;
  3. Build a broad-based alliance of partners for IMD in Africa (private sector, regional institutions, UN agencies, donors and other development partners); and
  4. Improve access to finance for small producers and micro, small and medium enterprises (MSMEs).[x]
AFIM, which builds on the work of existing pro-poor national and regional initiatives, serves as a platform for coordinating inclusive growth activities between various partners. The platform also facilitates knowledge sharing and access to finance, advances tangible value chain projects, and disseminates best practices in inclusive market development where the emphasis is on creating opportunities for low-income groups – especially women and youths.

The project’s particular focus is on promoting inclusive market development in Africa through developing and expanding regional value chains in job-creation sectors. Due to the importance of agriculture (which employs about 60 per cent of people in sub-Saharan Africa) and its key relevance for food security, AFIM focuses on agriculture and agribusiness.[xi]

Thus far, AFIM has undertaken and published several mappings and studies on the ‘Roles and Opportunities of Private Sector in Africa’s Agro-Food Industry’ and ‘Inclusive Business Finance’. The AgriBusiness Forum 2011 (in Johannesburg) and 2012 (in Dakar) were co-organised with the NGO EMRC, and aimed to boost Africa’s agricultural sector by bringing together African agri­business representatives, investors and policy makers from all over Africa and beyond. 

More specifically, the UNDP-led high-level public–private dialogue held in Johannesburg in October 2011 led to the adoption of the Johannesburg Declaration: “Engaging the Private Sector in Furthering Africa’s Agribusiness, Food Security and Nutrition Agenda”. This, the first joint declaration by the public and private sectors, calls for joint action to advance Africa’s agro-food agenda.[xii]

AFIM has built an alliance of Inclusive Market Development partners, including African Development Bank (AfDB), the African Union Commission (AUC), the New Partnership for African Development (NEPAD) Planning and Coordination Agency (NPCA), the NEPAD Business Foundation (NBF), the Pan-African Agribusiness Consortium (PanAAC), Regional Economic Communities (such as EAC, ECOWAS, COMESA), UN agencies and bilateral development partners.

AFIM’s innovative way of engaging the private sector through project facilitation platforms (PFPs)
AFIM has been establishing PFPs in East, West and southern Africa to boost food production as well as job and income opportunities for farmers, through engaging the private sector to advance agriculture value chains. Through these platforms, government stakeholders, UN agencies, the private sector, farmers, financiers and civil society discuss partnerships and their respective value-add as partners, in terms of strategic agri-food value chains.[xiii]

For example, the first such platform for East Africa was launched in Nairobi, bringing together East African Community (EAC) partners from Kenya, Tanzania, Uganda, Rwanda, Burundi and Ethiopia. Project promoters presenting planned interventions included Africa Harvest, East Africa Dairy Development Project and UNIDO/UNDP to advance specific value chains of sorghum, dairy and soy.

The platforms are unique in that they focus on cross-border and regional value chains, bringing together all the relevant players and building the capacity of regional institutions to organise such platforms themselves in the future. Furthermore, bridges are built between the public and private sectors, and resolve issues arising between policy level and practical project implementation. The West Africa platform, attended by representatives from 13 countries and launched together with ECOWAS in Dakar, Senegal, has been advancing the value chains of cassava, mango, onions and palm oil.

To catalyse the field implementation of selected regional value chains, AFIM has put in place a catalytic funding programme for promising value chain projects, in addition to developing an African Supplier Development Programme (SDP). The SDP aims to develop the capacities of African suppliers, i.e. smallholder farmers and SMEs in agricultural supply chains, to increase their productivity, reduce post-harvest losses and thereby increase income and production levels. The programme has received strong interest from African and international lead firms which want to strengthen and grow their supply chains.

Increased importance of innovation for transformational results
To achieve greater development effectiveness and unleash the power of the markets and of people, innovation and inspiration are increasingly recognised as key drivers. Leading thinkers on the theory of development change pose the question: ‘How are transformational results achieved?’ As yet there are no widely accepted answers. 

What seems to come to the fore is a recognition of the importance of people, societies and institutions in developing their own innovations, sometimes inspired by leading examples which are shared rapidly through communication technologies. Transformation differs from change in the sense that it is more fundamental, sometimes even ‘disruptive’ (e.g. the Arab Spring), an (r)evolution that has grabbed the attention of many African governments. 

Transformation comes from a deeper level within the entity being transformed, and gives rise to a change in status level, just as a caterpillar transforms into a butterfly. In terms of international development, this could see one form of governance changing into another, typically not without difficulties and periods of disruption. In terms of business it could mean a drastically different business model applying a new way of thinking and doing business. ‘Breakthrough’ innovations and related shifts in awareness can inspire such transformations.

Transformation from jobless to inclusive growth through inclusive markets
A paradigm shift is taking place in the spheres of both business and development actors. Inclusive business models provide a useful new approach in advising new business thinking beyond CSR and base of the pyramid (BoP) approaches. For development and government actors, IMD represents an innovative, holistic conceptual framework integrating economic and social development elements into a pragmatic multi-stakeholder development approach.

There is a clear need for inclusiveness and collective action, because no single actor alone can develop new markets in an inclusive way. Only through inclusiveness and (self-)empowerment will the transformation from jobless to inclusive growth happen. Further research is recommended to build the evidence base of inclusive business models, related value chain development and the more holistic inclusive market development paradigm.[xiv] Advancing both the evidence base and practical action-oriented implementation will build the envisaged future on a step-by-step, leap-by-leap basis.

Looking forward, one of the UNDP´s ambitions is to build broader and more strategic alliances with the private sector and other partners around key development challenges of common concern, such as the provision of energy, job creation and supporting green growth. In doing so, not only is development stimulated, but the potential of as-yet-unrealised markets is unlocked. Innovation and new ways of development and doing business will increasingly play vital roles in achieving transformative results, towards an envisaged and desired future.

[i] African Economic Outlook 2012, www.africaneconomicoutlook.org
[ii] The 2011 High Level Forum on Aid Effectiveness in Busan stresses the importance of partnering with the Private Sector, see Joint Statement on Expanding and Enhancing Public-Private Cooperation
[iii] Eleven of the world’s largest donor calling for more private sector partnerships, see Bilateral Donors' Statement in Support of Private Sector Partnerships for Development at the UN Private Sector Forum 2010, http://www.enterprise-development.org/page/download?id=1645
[iv] See UNDP’s Inclusive Market Development (IMD) approach, www.undp.org/content/undp/en/home/ourwork/partners/private_sector/IMD.html
[v] See UNDP’s Private Sector Strategy (2007), www.undp.org/content/undp/en/home/ourwork/partners/private_sector/OurStrategy/
[vi] For UNDP’s Inclusive Market Development (IMD) handbook and related tools (2010) see www.undp.org/africa/privatesector
[vii] See UNDP global Growing Inclusive Markets report Creating Value for All: Strategies for Doing Business with the Poor, www.growinginclusivemarkets.org
[viii] For more inclusive business cases and relevant reports see UNDP’s Growing Inclusive Markets (GIM) initiative
[ix] Sumitomo Chemical is a Business Call to Action (BCtA) and Global Compact member company
[x] For more information on UNDP’s African Facility for Inclusive Markets (AFIM) see www.undp.org/africa/privatesector
[xi] See UNDP AFIM’s Roles and Opportunities of the Private Sector in Africa's Agro-Food Industry report, www.undp.org/africa/privatesector
[xii] For the Johannesburg Declaration and the conference report on the AgriBusiness Forum see www.undp.org/africa/privatesector
[xiii] See article on UNDP’s Project Facilitation Platform on Business Fights Poverty, www.businessfightspoverty.org/profiles/blogs/undp-s-innovative-way-on-private-sector-development-through
[xiv] UNDP AFIM and GIM have been working on documenting African inclusive business cases and will launch a major report on this topic in 2013.

This article was originally written for the publication of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) "Value chain development by the private sector in Africa: Lessons learnt and guidance notes" due to be published in March 2013.