In the face of mounting social and environmental challenges, businesses play a pivotal role in fostering sustainable and inclusive growth. In this scenario, they are uniquely positioned to lead this transformation.
A recent article by McKinsey has addressed this topic. Our team has analyzed it and we are happy to share the main points with you. Let’s explore how businesses contribute to this global imperative.
Bridging the Divide
The first step towards promoting sustainable and inclusive growth is understanding two key areas that currently have a gap:
- empowerment
- sustainability
The idea of empowerment gap refers to the level of spending capability that households require to meet their basic needs, have discretionary income, and be able to handle unexpected emergencies.
On the other hand, the sustainability one refers to the additional annual investment in low-emissions technologies that a country would need to make to transition the world towards a pathway that achieves net-zero emissions by 2050.
Promoting Economic Growth and Innovation
Strong economic growth is a fundamental requirement for closing these gaps. Businesses can stimulate economic growth by creating jobs, investing in local communities, and driving innovation.
Furthermore, they can also drive innovation to make inclusion and sustainability more accessible by reducing the cost of products and services that promote these goals. This process could involve the development of new technologies or business models that are not only profitable but also beneficial for both society and the environment.
Unifying Efforts with Governments
Businesses cannot accomplish this on their own. Governments must intervene and allocate public resources appropriately. Companies should actively collaborate with public institutions to influence policies and regulations that foster sustainable and inclusive growth. This process could involve advocating for incentives for green technologies and schemes that promote income equality.
Boosting Growth: The Power of Asian Businesses
The role of Asian businesses is particularly significant. By 2040, Asia will account for 50% of global GDP and 40% of global consumption. Asian companies, therefore, have a unique opportunity and responsibility to drive sustainable and inclusive growth. For instance, businesses in India could contribute to closing its $1.9 trillion sustainability gap, while those in Japan could help narrow its $1.1 trillion empowerment gap.
Conclusion
Promoting sustainable and inclusive growth is an ambitious goal, but it is one that businesses must strive for. By driving employment, productivity, and opportunity, companies can make a meaningful contribution to creating a sustainable and inclusive world while fostering growth.
As HR specialists, our team at Pyou believes in the importance of embracing this challenge. We do not only aim to contribute to solving some of the world’s most pressing problems but also to position ourselves for long-term success.
