A great share of the Swedish development cooperation is organised through the Swedish International Development Cooperation Agency (Sida), which operates under the jurisdiction of the Ministry for Foreign Affairs (MFA).
Sweden’s Policy for Global Development (PGD) and the policy framework for Swedish development cooperation and humanitarian assistance, provide the outline for Swedish development cooperation, focusing on creating coherence and closer collaboration between all sectors of society in working towards achieving equitable and sustainable global development. This entails engaging a range of different public and private actors such as national and local authorities, civil society, the private sector and trade unions. The policy framework takes the current global development situation as its point of departure and relates to the 2030 Agenda, the commitments on development financing and the Paris Agreement on climate change.
Sida collaborates with the private sector, engaging corporate actors in thought partnerships to contribute to global poverty reduction and to promote inclusive and sustainable business models that enable people living in poverty to improve the quality of their lives. Discovering new and innovative ways to engage private sector actors in global development is not only seen as a mean to boost economic growth but also to leverage private sector resources that are valuable for reaching development objectives and poverty alleviation.
In addition to the MFA, other political and governmental actors also take part in designing how inclusive business is part of the Swedish agenda. The Ministry for Enterprise and Innovation is responsible for issues involving the business environment and innovation climate. The Swedish Innovation Strategy guides the Ministry’s work towards an innovation climate where different actors, including the business sector, can contribute to solutions to both national and global challenges. Swedfund is a Swedish development finance institution that promotes sustainable economic development by co-financing investments and building businesses and industries that can combat poverty. Swedfund’s approach to poverty alleviation is to ensure economic growth and job creation.
Inclusive Business in Private Sector Promotion
In 2010, Sweden established its Business for Development (B4D) programme to provide a framework for collaboration with the private sector. The programme consisted of different instruments to be used for engaging private sector actors, such as challenge funds drivers of change, guarantees and Public Private Development Partnership (PPDPs). Today, collaboration with the private sector has developed, and these instruments are regarded as components of a more systemic approach. New innovative approaches have been developed at implementation level, in close collaboration with concerned partners. This has led to innovative projects where instruments have been combined in new ways or completely new instruments have been developed. Inclusive business with a focus on the poor is considered a fundamental aspect of private sector collaboration.
Sweden supports inclusive business initiatives bilaterally and regionally as well as globally, although they may not always be classified as such. The main objective of Sweden’s development cooperation for sustainable economic development is to improve the opportunities of poor people to contribute to, and benefit from, economic growth. Involving more poor people in value chains through inclusive business initiatives is an important means of achieving this goal. Moreover, all inclusive business engagements should promote the priorities of the Swedish development cooperation, including gender equality, human rights, democratic values, and the environment.
Sweden cooperates in various ways with different countries. In many countries, Sweden has a long-term cooperation, and maintains a direct dialogue with governments and agencies; in other countries it works through Swedish and international organisations. Today, Sweden maintains extensive long-term development cooperation with a total of 36 priority countries in Africa, Asia, Europe, and Latin America, in addition to regional, global and thematic cooperation.
Private sector: SMEs
Objective: To support social entrepreneurship and innovations by giving small enterprises the opportunity to receive grants in order to jump-start and develop their ideas.
Activities: The programme functions as a risk sharing mechanism for sustainable business ventures, which have a strong potential to reduce poverty.
Private sector and IB ecosystem: Large Swedish companies
Objective: By initiating and coordinating the SLSD, Sida wants to be a relevant partner for the business sector and stimulate private investments that make a difference for people living in poverty and those who are vulnerable.
Activities: SLSD is a business network consisting of Sida and the leaders from more than 20 of the largest Swedish companies, which strives for sustainable development.
Private sector: Innovative businesses
In addition to funding the initiative, Sida contributes to IB by engaging in dialogue and networking with the other BCtA funders.
Objective: To accelerate progress towards the SDGs.
Activities: Challenging companies to develop IB models, engaging people at the BoP as consumers, producers, suppliers, distributors, and employees.
Through BCtA, over 200 companies have committed to improving the lives and livelihoods of millions of people.