Inclusive Business Model

An inclusive business model is a business model designed to generate ordinary commercial value for a company while deliberately integrating low-income populations into its operations, either on the demand side as clients and consumers or on the supply side as producers, entrepreneurs or employees, in a way meant to be sustainable rather than a one-off gesture. The approach can be adopted by organizations of very different kinds, from multinational corporations and domestic companies to cooperatives, small and medium-sized enterprises, and nonprofits that apply ordinary business methods to their work. What distinguishes an inclusive business model from corporate philanthropy or corporate social responsibility is that social value creation is built into how the model captures value in the first place, rather than being funded separately out of profits earned elsewhere; on this view, an organization only qualifies as genuinely practicing inclusive business if it succeeds in creating that intended value for the low-income populations it engages, without causing them harm in the process.