Governments have copious data on the needs of low-income populations. They also know about the execution challenges inherent in inclusive business initiatives. Therefore, partnering with them can help innovation sponsors and managers address on-the-ground hurdles associated with scaling. Most important, governments have resources to invest in disruptive innovations that can help inclusive ventures scale.
To effectively engage government partners, IBI managers need to be able to evaluate their company’s ability to gain an audience with key decision-makers. Engagements with critical decision-makers in emergingmarket governments are almost always cultivated at the top of a company. Therefore, IBI managers seeking to engage governments need to consider high-level internal leaders’ willingness to engage with governments to acquire transparent support—as well as ability of government bodies to make and implement accountable decisions with the speed that is necessary to support a profit-driven business.
Fostering a balanced regulatory environment A “balanced” regulatory environment protects the rights of consumers without unduly burdening industry; it also provides a predictable policy climate in which to operate. Within that climate, IBIs invest in assets needed to achieve scale, such as distribution channels. Moreover, balanced regulation that promotes inclusive innovations in a particular industry can inspire similar regulation in other industries.
However, given the intense board-level pressure to demonstrate the prospect of profitability, IBI managers rarely have the convenience of time that is necessary to change local regulations. Accordingly, it’s critical that IBI managers have an in-depth understanding of the existing regulatory environment. Those who find a way to piggy-back on existing regulations can gain a significant advantage in accessing lowincome markets and controlling the costs of building an IBI.