Dismantling Inequality through ASSURED Innovation

＜善いビジネス＞が成功をもたらす―CSR2.0と包摂的イノベーション

R. A. Mashelkar, National Research Professor, India
IIZUKA Michiko, Professor, National Graduate Institute for Policy Studies, Japan

Philanthropy, CSR, Inclusive innovation

December 16, 2021

SciREX Center

SciREX WP 2021-#3

https://scirex.grips.ac.jp/resources/2021/1083b824030660fe4ba5ed2bee620be3db4719a0.pdf

SciREX Working Paper

Corporate Social Responsibility (CSR), a form of social contribution by companies, has a long history conducted purely as a philanthropic activity. The author proposes a new model of "Corporate Social Responsibility (CSR)" to promote the Sustainable Development Goals by using Disruptive and Inclusive Innovation (DII), based on a case study in India. Previously, the author named the Indian government's mandate for companies to spend 2% of their net profits on CSR as "CSR 1.0". This time, what he further proposes as "CSR 2.0" is a "doing good and succeeding" model that creates equal opportunities to increase wealth. CSR 2.0 is strongly linked to inclusive innovation.

Inclusive innovation means "efforts to create, acquire, absorb, and distribute knowledge with the direct goal of meeting the needs of low-income or base of pyramid (BoP) populations." The focus of inclusive innovation is "to provide high-performance products, services, and experiences at very low cost to those whose needs are not well attended to." In order to achieve CSR 2.0, the authors define "ASSURED" innovation as A (Affordable), S (Scalable), S (Sustainable), U (Universal), R (Rapid), E (Excellent), and D (Distinctive). The key to ASSURED innovation is to move away from a "technology push product out" approach to a "customer-centric, market-based" approach.

The key to ASSURED innovation is to move away from a "technology push product-out" approach to a "customer-centric market-based" approach and to create new platforms for global growth that are rooted in the needs of emerging markets and that span the entire economic pyramid. We need to move from a mindset of competing for a fixed share of the market to a new market-based and new funding approach that will help us take a bigger share.

What is fundamentally needed here is to believe that happiness, health, prosperity, and peace are fundamental human rights. In addition, government plays three major roles in ASSURED innovation. (1) the government's large procurement budget allows it to be the most influential and demanding customer, driving innovation. (2) to promote innovation, either indirectly by setting regulations or directly by changing the demand for certain products and services. (3) by setting standards, demand for innovation is created and market dominance is created.

ASSURED innovation can be useful in any country for three reasons. First, it can bring about social harmony by creating equality of access. Second, affordability leads to increased scale, which brings equality to people. Third, being first-class can respond to the people's growing desire for high quality products and services on the one hand, and open up opportunities to enhance export competitiveness to global markets on the other.