Published 3 years ago.
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Image: rice farmers in Kerala, India | weareaway/Pixabay
As we enter a new decade, it is evident that stakeholder capitalism is here to stay. This new era means that businesses can only be assured of success by
adopting values that mean that everyone, everywhere can participate in the cycle of inclusive growth.
There is a new consensus. From the 2008 financial crisis and changing
geopolitical relationships, to increasingly urgent environmental concerns, we
have been living in a period marked by uncertainty and a questioning of our
global economic model. The principle that economic growth should be the driving
force behind all business objectives and government campaigns has been severely
Cue the rise of stakeholder capitalism, greater business realisation of their
place in society and their impact on the world around them. Together, we must
define what inclusive growth really is. This means moving beyond looking at it
purely through the lens of market share and the bottom line. It’s about
incorporating social and sustainability goals, while ensuring that growth
unlocks the potential of people and communities.
It’s evident that the world is falling
on the UN 2030 Agenda for Sustainable
Extreme rural poverty is three times higher than in urban
yet one in four urban residents still live in slum-like conditions. There are
750 million adults in the world who are
while 785 million people cannot access drinking water.
Such wide-reaching challenges are incredibly complex and diverse. To ensure that
inclusive growth works for everyone and reaches every corner of the world, an
equally comprehensive response is required. We need to approach this with an
understanding that the global economy is powered by three networks:
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physical networks (electricity, transportation and water),
virtual networks (digital platforms, markets & supply chains, and financial
social networks (local communities, family & friends, and investors &
mentors) [Figure 1].
In the same way that poverty is a cyclical trap, sustaining inclusive growth is
conversely cyclical. In order to unlock people’s full economic potential, you
need to connect them to all three of the networks that drive the global economy.
By bringing people into these crucial ecosystems, you propel them into a
virtuous cycle of inclusive growth [Figure 2]. This is called democratising
productivity — improving the quality of life, job opportunities, income levels
and financial security for everyone, everywhere.
One of the key challenges of achieving a cycle of inclusive growth is ensuring
that no place or person is left behind. This requires collaboration at scale in
order to connect with people and communities that may have never experienced
financial inclusion before. Therefore, it necessitates a shared global vision
and an interconnected web of partnerships.
Here is a four-part model designed to drive cross-sector collaboration and help
advance global aims:
Leading economists and scholars have an essential role to play. It’s why
Mastercard launched a
Data Fellows programme in 2018 to bring together the very best data
scientists from academic and government institutions with our own.
Together, they work to unlock insights that can be used to help improve
economic stability for vulnerable communities. For example, in New
Orleans, they identified how tax incentives stimulate spending in specific
neighbourhoods and how low-income areas of the city can benefit from money
generated through tourism and popular events.
This partnership model can be rolled out to the benefit of policymakers in
other cities around the world.
Inclusive growth is about supporting the overall economic growth of local
communities, so entrepreneurs and workers can grow, thrive and succeed.
Programmes such as the Mastercard Farmer
— developed in partnership with the International Centre for Tropical
Agriculture in Uganda, the Government of Andhra Pradesh in
India and the National Microfinance Bank in Tanzania — have
helped more than 275,000 farmers leverage digital tools.
Data is a powerful tool used by businesses around the world to influence
decision-making. Yet many actors — including non-profit, civic and
government organisations — do not have access to this level of insight.
By partnering with the Rockefeller Foundation to create the Data for
programme, we have developed a $50 million fund to support those on the
front line of social good. This fund allows them to unlock the power of data
and discover insights that help form the foundations of impactful community
A strong leadership community is required to ensure the promotion and
adoption of evidence-based solutions.
Facilitating dialogue with stakeholders is a powerful knowledge-sharing tool
that improves understanding; and when coupled with participation in
sustainability membership organisations and peer networks, information and
learnings can be communicated effectively. These approaches can be adopted
worldwide to enable and inform inclusive growth.
We have put inclusive growth at the heart of business models, ensuring that
success is in part measured by the positive impact we are having on the
communities and countries around the world that use our services and connect
with our partner networks.
As we enter a new decade, it is evident that stakeholder capitalism is here to
stay. This new era means that businesses can only be assured of success by
adopting values that mean that everyone, everywhere can participate in the cycle
of inclusive growth.
Published Jan 22, 2020 7am EST / 4am PST / 12pm GMT / 1pm CET
For more than 20 years, Shamina Singh has been on the front lines of developing and implementing solutions to make the global economy work for everyone, everywhere. Shamina is the Founder & President of the Center for Inclusive Growth, the philanthropic hub of Mastercard. She also serves as Executive Vice President of Corporate Sustainability.