before answering to your question Tatiana… I totally agree with you Maarten. It is key for the company to recognze IB and to integrate IB in its corporate strategy as a new market, and new way of creating complete and global value for the Group: Business/New Market + Innovation + Social Impact + Talent and HR management.
We have launched in 2017 a new business to make medical oxygen accessible for the smallest health facilities. It allows them to treat locally and not to transfer the patient in a bad condition. Key question, especially for children under five! A challenging topic because it is a real new market, new customers, new environment for the group. The question still remains: do we accept to integrate in our health portfolio, complete solutions for all the level of the sanitary pyramid, which is a challenge and has to be seen in a long term perspective, or do we remain focusing at the top of the sanitary pyramid, much easier market because we know it !
You are certainly right, it is quite a stretch, both in terms of mindsets and targets. It’s the nature of a corporation that sometimes only a CEO or top-level strategy can bridge (and sometimes not even that). But I believe it’s worth trying, and also, as Rey pointed out, making teh case with convincing numbers (that are still broadly missing).
Catalyzed the Employees’ personal growth (skill development, promotion)
Talent retention and attraction
Increased new partnership possibilities (With governments, social enterprises and NGOs, business schools, corporate responsibility coalitions, foundations and venture philanthropists, etc.)
Increased revenues & sales
Reputational benefits. Legitimacy, Legacy
Self-renewal, Cultural change, Social Transformation
Good point. We need spaces were the parties that should be talking actually meet. Impact investing has played a surprisingly little role so far in CIV, despite all their capabilities. It’s just another conversation.
According to me, it means to have a better view of the differences (pro and cons and main objective) of each solution. It also requires a better collective intelligence and sharing experiences between the Corporates who want to develop Inclusive Business with ambition. What about co creation and co design solutions between some of us !?
We also have to be aware of : the BoP market is not easy and the Inclusive Business strategy and objectives might not be aligned with the Corporate global strategy and short term objectives, so how to maintain the momentum, how to move forward with the same ambition and means, without comprimising the short term corporate company objectives etc…
In that perspective, 3 stakeholders are key to convince and to involve: the shareholders first, the Comex members, of course and the employees who are looking for more and more meaning in their business life.
in our case impact investors were actually disappointing. they were as devoid of imagination as our corporate guys. there was massive reluctance to co-invest despite it being a lower-risk investment for them. i think there is a lack of trust between big corporations and impact investors.
Another driver here is the major transformation that is happening in most sectors (energy, health, food, etc…) and that forces companies to rethink their future business model. Here, they need to take social and environmental changes and challenges into account, simply because these represent the value creation potential of the future. CIV is a fitting instrument in the process, because companies find it hard to innovate radically internally, but they can scout externally for solutions that can enable these future systems.
CVC is not considered “commercial” but “strategic” toward a longer-term commercial objective. And so CIV will need to be seen as “strategic” to the same or to another/related impact agenda. In other words: it requires quite a high level of strategy sophistication + impact orientation. Which is why I suggest a “training wheels”, shared risk, low-investment option.
So it is about first making the corporate see the strategic value of inclusive business, and subsequently making them see they need to use CIV to overcome the problem that the inclusive business is too new to build it from within the mainstream business.
Creating an enabling environment for Corporate Social Intrapreneurs to thrive:
Safe space to ideate, create concept, test, fail, reiterate, implement
Create an official status for Corporate Social Intrapreneurs
Give Corporate Social Intrapreneurs with proper time (no conflict with their previous job)
Upgrade the skills of the Corporate Social Intrapreneurs: Knowledge of entreprneurship, BoP markets
Develop new internal organizational processes providing Corporate Social Intrapreneurs with the freedom, responsibility and authority necessary for entrepreneurial success
Facilitate cross department collaboration
Set up Peer Exchange Sessions with other successful Corporate Executives and Social Intrapreneurs
Really interesting. There are so many divides criss-crossing in this space that inhibit productive co-creation. But we are also just at early stages. It seems Investisseurs and Partenaires are quite different here, as they proactively address large companies and have a good track record in this collaboration. What is your experience @Priscilla?
That’s interesting! Suggests to me that “impact investors” are (still) mostly old-school VC types driving an exclusionary/inclusionary model (i.e. not “imaginative” as you put it). I certainly haven’t met many players in the grey zone between “finance-first” and “impact only”.
Indeed. That’s why I am such a fan of the Third Party Fund approach. It can really be a good entry point to learn the ropes and figure out a lot of these tricky questions on the go. I hope we will see more of these vehicles popping up!
they are surely old school - they need social entrepreneur to think social entrepreneurship. a corporation replacing social entrepreneur is too radical an idea for them - for at least the ones operating in pakistan
If you look for CVC in the “grey” zone you can talk to Danone, Engie, Renault, orSchneider all the French corporates that have decided to leverage the French legal obligation to offer a social saving fund to their employees
Employees have been indeed an important driver and enabler of many CIV schemes. Their need for purpose also challenges boards to define strategy beyond commercial objectives. And employees that have been exposed to inclusive business ventures bring valuable inspiration into the company in that regard, and act as “lighthouses” internally. In the case of Boehringer Ingelheim’s “Making moer health” with Ashoka, that is the main purpose, for example.
The French model is inspiring and also shows how powerful legal incentives can be to catalyze the sector. The 90/10 rule, where “solidarity funds” get tax exemptions if they invest up to 10% into social impact businesses, is a policy worth copying.