Earlier this year, BCtA welcomed the Finnish ministry of foreign affairs as the newest member of the donor steering committee. Here, Pekka Puustinen, the Ministry’s director general for Development Policy, shares his thoughts on the SDGs, the role of the private sector in the new global agenda and the government’s efforts to stimulate private sector engagement and innovation in development, the Slush bootcamp to build the capacity of startups from developing economies, and the Ministry’s new, and unique, emojis.
What is the government of Finland’s strategy around the role of the private sector in development?
From clean energy technologies to water management, health care technologies to solutions for efficient administration, Finnish companies have products, services and expertise that can help spur development in a sustainable way. And as with all businesses, expanding into untapped markets and developing new partnerships helps drive innovation and growth. By combining development policy with trade policy, the government creates an enabling environment for developing countries to achieve sustainable, climate-smart and inclusive economic development that can create decent employment for all people.
Finland also puts strong emphasis on the engagement of the private sector, both in Finland and developing countries alike, in sustainable development. By doing so we create jobs, strengthen value chains, transfer skills, technologies and good business practices as well as pave the way for increasing business for Finnish companies in rapidly growing markets.
Finland emphasizes the importance of corporate social responsibility and sustainability issues as well as the UN guiding principles on business and human rights in all private sector cooperation. Women’s economic empowerment and inclusion of the poorest people in economic activity are also crucial in Finland’s cooperation.
What are some of the ways the government of Finland is using to stimulate private sector innovations to support the development agenda?
Finland’s primary agency for stimulating innovations is the Finnish Funding Agency for Innovation (Tekes). Tekes provides innovation funding for companies, research organizations and public sector service providers, with the main clientele being SMEs looking for international growth.
The ministry for foreign affairs of Finland (MFA) and Tekes initiated BEAM – Business with Impact, a joint €50m (£36.3m) innovations for development programme for 2015 to 2019. BEAM supports development, piloting and demonstration projects of innovations that help improve the lives of the people in developing countries. BEAM is looking for ground-breaking new products, services, technologies, business models and social innovations that help reduce poverty, advance sustainable development and offer lucrative business potential for the companies. Another MFA funded mechanism for stimulating private sector investment is the Finnpartnership. Though smaller in volume than BEAM, this business-to-business partnership program which is run by Finnfund looks to finance pilot and demonstration projects of new solutions and technologies as part of business partnerships.
How can multi-stakeholder platforms like the Business Call to Action help achieve development goals of donor governments, including those of Finland?
From challenging companies to commit to inclusive business to promoting their models to a wider audience; from brokering links to peers and vital information to providing the tools and analysis to measure impact, BCtA’s objectives are well aligned with our goals; facilitate job creation and enterprise development, increase access to sustainable energy services or reduce CO2 emissions. BCtA aims at the same development impacts as Finland has promised to target as part of Agenda 2030 and Sustainable Development Goals.
BCtA also offers a good platform for Finnish companies to scale up their innovations and business models globally with the help of the UNDP and helping to build links between the member companies for increased business opportunities and greater partnerships. It is for these reasons that we are pleased to support BCtA and hope to see Finnish companies availing themselves of the valuable tools BCtA membership has to offer.
How are the SDGs different from the MDGs and what are some of the opportunities, and challenges, for the private sector with this new development agenda?
The MDGs focused attention and resources on several areas, especially those that were socially and environmentally-inspired. A lot was achieved through the MDGs. However, the global development needs are different now and as a result, the SDGs and the entire Agenda 2030 view the world and development in a very different light. Agenda 2030 is comprehensive and binding for us all. Seven out of the seventeen SDGs are directly linked and dependent upon the role and contribution of the private sector. In short, the 2030 agenda will not possible without the private sector.
The SDGs and Agenda 2030 take into account the inter-dependence of different sectors. Financing the development agenda as well as climate change mitigation and adaptation will require huge resources which are not possible to derive from the public sector alone. The Official Development Assistance has an important role to encourage and facilitate multiple private resource flows into directions that are more sustainable and development-oriented. At the end of the day, however, private resources are private, and the public authorities cannot decide how they are allocated. The governments must be attractive partners to the business sector and be able to make the business case of sustainable development for it. This is another example of why platforms like BCtA are so important to donor governments and the 2030 agenda.
There has been a growing interest in advancing inclusive business models, as we have seen from the increasing number of companies joining the Business Call to Action. What do you think are the factors driving this momentum?
BCtA members see that saving the world is good business. The world needs new solutions to end poverty, reverse climate change and make inclusion of all people in development a reality. That’s where the companies step in, but of course from their own profit-making perspective. Good cases are can be found in renewable energy services, LED lighting and prepaid sim cards, to name a few.
The private sector seeks profit, and rightly so. Currently our own markets in Europe and elsewhere in the richer parts of the world are growing sluggishly or even stagnating, as ours in Finland. Rapidly growing markets and expanding business opportunities are found in low- and middle-income countries. For decades China, India and other BRICS were the prime targets of business expansion. More recently, the private sector has been finding these opportunities in African and other lower-income markets and Finnish companies are, fortunately, among them.
We also shouldn’t underestimate the power of social business. Increasingly many companies are actually doing business in the triple-bottom-line way: while making a sufficient profit for survival, they also want to solve societal challenges and be climate sustainable. Profit is optimized in order to finance salaries, innovations and expansion but not necessarily maximized in order for the owners to become rich. This is at the heart of inclusive business.
Earlier this month, Finland co-hosted the Slush Global Impact Accelerator, which brought 30 start ups and 15 tech hub leaders from developing markets to a nine-day bootcamp as part of the annual Slush Forum, Europe’s leading investor start-up event. What were the goals of the bootcamp and some of the highpoints of the event?
The Slush Global Impact Accelerator is a joint partnership between the MFA and Slush. And if Slush itself has grown enormously, Slush Impact has grown even more, occupying one of the event’s stages of the entire two days. Moreover, an interesting group of partners, including UNICEF, presented their cases on the main stage of Slush. It was ground-breaking to see a traditional development organisation pitch to an audience of startups and investors.
The bootcamp aimed at building the capacity of the startups and innovation hub managers in business skills and management, pitching investors, media skills, sharing best practices and building networks with each other, the many networks in Finland and around Slush. And of course to have great fun in Finland at the time of the year which is the least attractive time to visit our country!
BCtA brought the message of inclusive business to the event. In Inclusive Tech: Taking Innovation to Scale in Emerging markets, BCtA members shared their insights on how technological innovations with potential impact on the lives of people at the base of the economic pyramid can be sustainably scaled up.
The highlights of the gathering should probably be asked from the entrepreneurs themselves (you may, in fact, read one entrepreneur’s experiences from here). I imagine that pitching the investors in front of hundreds of people at the Pitching Stage must have been stomach-turning. Well, the next time it will be easier. I also heard that many of them made valuable contacts that may bring them business cooperation and investment money in the future.
What is needed to make inclusive business mainstream within the private sector?
Inclusive business can be mainstreamed if it’s good business. When companies can find new customers, producers, innovators, distributors and other partners in low-income communities and it makes sense from the business perspective, it will become mainstream business.
We in the development policy world can support this by providing an enabling environment that helps facilitate the financing needed for the kinds of business development, partnerships, innovations, investment etc. that can change the world. Essential as well is regular, open dialogue between government, companies and the private sector in general to learn what they need and ensure our what we are offering meets their needs.
Finland recently became the first country to publish its own set of emojis. What prompted their publication and how will they be used, especially by the ministry of foreign affairs?
Emojis are a standard part of informal communications. You can see smileys even in our work emails!
Our emojis reflect our country and culture and mind-set. They are a good way to make Finland and Finnishness known globally. In a way, the Finnish emojis promote Finland’s country brand. We will use them in mobile communications and social media.
The emojis can be downloaded and used by anybody anywhere in the world.
Copy on this page is provided by Business Call to Action, supporter of the role of business in development hub
