Asean pushes for inclusive business models for sustainable growth

Asean pushes for inclusive business models for sustainable growth

The Sixth Asean Inclusive Business Summit, hosted by Indonesia, emphasised the importance of establishing a conducive environment for micro, small and medium enterprises (MSMEs) and for large businesses to adopt inclusive business (IB) models that contribute to inclusive and sustainable development in the region.

With the theme “Incentivising Businesses for Inclusive Growth,” the summit focused on the significance of multi-stakeholder partnerships in building an IB ecosystem in Asean through enabling policies, from accreditation, coaching, to innovative financing schemes.

Minister of Cooperatives and SMEs of the Republic of Indonesia Teten Masduki appreciated Asean’s efforts in strengthening regional commitment to inclusive business through the convening of the first High-Level Ministerial Meeting on Inclusive Business. He stated, “The High-Level Ministerial Meeting on Inclusive Business is a historic event for Asean as it brings together ministers dealing with MSMEs to exchange views and reaffirm our commitment to driving inclusive and sustainable business practices in Asean.”

During the summit, Asean scaled up its commitment to IB by hosting the inaugural High-Level Ministerial Meeting for Ministers responsible for MSME development in Asean Member States (AMS). At this meeting, AMS exchanged good practices to promote the adoption of IB models and adopted the “Declaration on Promoting Inclusive Business Models : Empowering Micro, Small and Medium Enterprises for Equitable Growth”.

Through the statement, AMS recognised the important role MSMEs play in driving economic growth, fostering innovation, generating employment, and reducing poverty as well as the contribution of large businesses in driving productivity and stimulating income-generation activities. They also acknowledged the potential of the IB model in achieving economic, commercial, and social objectives.

Guiding this high-level commitment is the Plan of Action for the Promotion of Inclusive Business in Asean (2023-2027), which was endorsed by the Asean Economic Ministers during the 55th  Asean Economic Ministers’ Meeting on 17 August in Semarang, Indonesia.

The Plan of Action will focus on four priority areas, namely, strengthening policy advisory support for AMS to develop and adopt policies and strategies to promote IB; supporting businesses in developing and integrating inclusive and sustainable business models through coaching services to develop IB models and linking MSMEs to larger companies; establishment of financial vehicles to pilot innovative financing instruments to provide access to finance for inclusive businesses; and establishing an Asean IB knowledge hub to generate awareness and share information and resources on IB.

Dr Le Quang Lan, Director of Market Integration of the Asean Secretariat, on behalf of the Secretary-General of Asean Dr Kao Kim Hourn, welcomed the timely endorsement of the Plan of Action as Asean prepares for the transformative forces that are reshaping the global economic landscape. He further offered recommendations vis-à-vis the implementation of the Plan of Action, to promote inclusivity in Asean’s approach in addressing its key priorities, namely, digitalisation, green economy and supply chain resiliency.

In collaboration with the Asean Business Advisory Council, Asean presented the Asean Inclusive Business Awards to ten businesses to showcase exemplary inclusive business models from businesses across all the AMS.

 “Inclusive businesses are different from business-as-usual as they put people and planet alongside profit, and are therefore, a critical accelerator if we are to get back on track on the SDGs. ESCAP is committed to move inclusive businesses from the margins to the mainstream,” said Armida Salsiah Alisjahbana, Under-Secretary-General of the United Nations and Executive Secretary of the Economic and Social Commission for Asia and the Pacific (ESCAP).

“The Asean Region – with its ambitious development agenda, integration in global value chains, and strong economic fundamentals – will benefit from inclusive business models,” said OECD Secretary-General Mathias Cormann. “The OECD continues to provide policy analysis and advice on best practices to support inclusive businesses and policymakers in Asean in putting these tools into practice. Looking ahead, the OECD stands ready to build further on our strong cooperation and support the development of an Asean Knowledge Hub to advance the Plan of Action.”

On the importance of businesses and sustainable development, Dio Herdiawan Tobing, Head of Public Policy for Asia at the World Benchmarking Alliance, appreciated Asean for prioritising businesses as drivers of inclusive and sustainable growth. He stated, “Asean has established a compelling demonstration of how corporate accountability measures can effectively contribute to transformative changes for sustainable development.”

Indonesia, as the Asean Chair for 2023, hosted the summit, which was co-organised by the Ministry of Cooperatives of SMEs in Indonesia, ESCAP, OECD, and Asean Secretariat, and supported by the World Benchmarking Alliance and Oxfam.

The summit welcomed government and private sector representatives from Asean and beyond, as well as investors and development organisations. The summit is an annual activity of the Asean Coordinating Committee on Micro, Small, and Medium Enterprises, the sectoral body under the Asean Economic Community pillar responsible for coordinating MSME development in the region, contributing to the implementation of the Asean Strategic Action Plan for SME Development 2016-2025. Incoming Asean chair Lao PDR announced that the Seventh Asean IB Summit will be organised in 2024.

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