This goal covers multiple topics including financing of development aims, international partnerships and cooperation, and cooperation across science, technology, data, and other fields. For an overview of global and regional organizations and platforms that are working on topics of relevance to MSMEs, see appendix A, and the example in box 7.
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Box 7. World Bank early stage MSME finance in India For example, in the area of Early-Stage MSME Finance, the World Bank’s MSME Growth, Innovation and Inclusive Finance Project in India improved access to finance for MSMEs in three vital but underserved segments: early stage/startups, services, and manufacturing. A credit line of $500 million, provided to the Small Industry Development Bank of India (SIDBI), was designed to provide an affordable longer-term source of funding for underserved MSMEs. Technical assistance of about $3.7 million complemented the lending component and focused on capacity building of SIDBI and the participating financial institutions (PFIs). In addition to directly financing MSMEs, disbursing a total of $265 million in loans, the project pushed the frontiers of MSME financing through the development of innovative lending methods that reduced turnaround time, reached more underserved MSMEs, and crowded in more private sector financing. It also reached new clients, women-owned MSMEs, and MSMEs in low-income states. The project supported SIDBI to scale-up of the Fund of Funds for Startups, which aims to indirectly disburse $1.5 billion to startups by 2025. SIDBI’s “contactless lending” platform, a digital MSME lending aggregator and matchmaking platform, has crowded in $1.9 billion of private sector financing for MSMEs, making it the largest online lender in India. Source: https://projects.worldbank.org/en/projects-operations/project-detail/P151544 |
MSMEs are a source of partnership to implement the SDGs. Small businesses address societal needs through market solutions as demonstrated by social enterprises (see Goal 10). MSMEs also play a role in public-private partnerships (PPPs) to provide services to address various developmental challenges. They can participate in dialogues with governments and communities to find solutions to development problems as they work closely with communities. They can contribute to society through Corporate Social Responsibility (CSR) practices.
CSR has been a well-known concept though the interpretation of this concept differs among countries, companies and stakeholders. In some cases, CSR has been abused as a marketing ploy, masking unsustainable practices of companies, in others it has simply constituted a charity event, again, often to mask the negative impacts of companies’ operations. Increasingly, companies are adopting sustainable business practices as an integral part of their corporate strategies. some businesses also engage in social or impact investment and/or play active roles in development cooperation, including the provision of disaster relief and humanitarian assistance. In this regard, the concept of CSR has evolved and today is often referred to as “corporate sustainability” or “responsible business practices” (RBP) or responsible business conduct (RBC). Various global RBC instruments and sustainability frameworks, such as the Global Compact, Global Reporting Initiative and ISO 26000, have been increasingly adopted by many companies, usually the bigger MNEs. However, two main issues can be identified which require attention by both policymakers and companies. First, many companies in the Asia-Pacific region, in particular the millions of MSMEs, are slow to adopt RBC instruments as they are considered to undermine their competitiveness and belong to the realm of the public sector. Secondly, the increasing number of different RBC instruments and sustainability frameworks has led to a certain level of confusion and imposed cumbersome and duplicative reporting burdens on companies, and therefore some form of convergence is required.
Aside RBC instruments, individual MSMEs have the potential to adopt actions in their business practice to contribute to the goals. For example, an MSME can seek out a local community initiative that advances sustainable and inclusive development that the organization is close to and have a conversation on how the business can support their work. They could also partake in SDG-related partnerships like the UN's Make the Global Goals Local campaign, the SDG reporting initiative and locally-based sustainability initiatives.
Policy measures to support Goal 17:
- Address emerging issues in the region better through further research, guidance and capacity-building among MSMEs (especially in the areas of biodiversity, human rights and supply chains)
- Promote and showcase best practices in the application of global RBC instruments
- Encourage business networks in the Asia-Pacific region, including multi-stakeholder partnerships to develop guidance and tools for RBC
- Bridge the implementation gap between global RBC instruments and Asia-Pacific companies by offering companies more useful guidance for implementation of these instruments.
