The Asia Pacific Women thought leadership series brings focus to the status of women in the Asia-Pacific region through expert commentary on women’s social inclusion and economic engagement in several aspects of life.
The COVID-19 global pandemic is accelerating the pace of change in the already dynamic region of the Asia Pacific. The United Nations’ chief, António Guterres, described this current point in history as the most challenging crisis since World War II. As a result, the region, and world, is undergoing fundamental shifts in the way people work, are educated, and raise families. These are alongside existing megatrends including technological breakthroughs, rapid urbanisation, a changing climate and resource scarcity, a shift in global power dynamics, and demographic change.
To respond to this complex intersection of challenges, the Asia Pacific needs to collectively enable a generation of innovators who are up to this task.
Across the region, social entrepreneurship was on the rise prior to the COVID-19 pandemic. Young, dynamic, diverse, educated, and digitally connected innovators were investing their time and resources into shaping a new era of business that delivers for both the economy and the community. Ensuring this trend continues will bring positive outcomes across the region as it navigates through this period of uncertainty.
However, the outlook for social entrepreneurship is mixed and varies depending on the approach to examining this phenomenon. In this analysis, the first approach focuses on the Group of 20 (G20) and looks at the macro-policy environment, and how this corresponds to enabling social entrepreneurs. The second focuses on the experience of social entrepreneurs at a more granular level in the region and home country, in this case using the Thomson Reuters Foundation Poll 2019 and the Global Entrepreneurship Monitor’s Youth Entrepreneurship in Asia and the Pacific 2019 report.
The G20 is an interesting case study when examining how entrepreneurship policy has developed over the last decade into a mainstream agenda item. As the G20’s relevance increases in the Asia-Pacific region, especially as member country economies such as India and Indonesia rapidly grow, how this multilateral forum shapes and influences policy in the region is important.
Entrepreneurship first appeared on a G20 Leaders’ communiqué during the Russia presidency in 2013. This early policy approach focused on how entrepreneurship might increase employment. Over successive presidencies, policy recommendations evolved to become broader in their approach but more precise in the groups of people, industry sectors and global trends they sought to address. Over the seven years since the St Petersburg Summit, these policy recommendations addressed particularly high levels of youth unemployment, improving trade and competition through innovation, technology and the digital economy, the future of work, tourism, and inclusive economic growth especially for women.
That entrepreneurship remains firmly on the G20 Leaders’ agenda reflects the work of several engagement groups that advocate for their stakeholders through their own communiqués and advocacy activities.
It also means that many of these policy recommendations are characteristic of social enterprise. This includes the Women 20 (W20), an engagement group that focuses primarily on advancing the economic interests of women among G20 member countries. Since the W20 was formally established during the Turkey presidency in 2015, policies that enable women entrepreneurs have featured in the final communiqué. Other engagement groups including the Business 20 (B20), Youth 20 (Y20) and G20 Young Entrepreneurs’ Alliance (G20 YEA) have all played a significant role in shaping entrepreneurship policy across the G20.
The challenge with the G20, and other non-binding multilateral fora, is the translation between policy recommendations to legislative or cultural change within member states. Examining the state of social entrepreneurship at a more granular level in the region is important.
The Thomson Reuters Foundation Poll tells us that the Asia-Pacific region is struggling to keep pace with the global leaders in social entrepreneurship. The poll ranks the best countries to be a social entrepreneur based on six indicators, these are government support, attracting skilled staff, public understanding, making a living, gaining momentum, and access to investment. In the general poll, Australia, Singapore, and Indonesia make it into the top 10 countries at 2, 5 and 9, respectively. In the women’s poll which factors in representation in leadership rolls and gender pay gap, Malaysia jumps into the top 10 and Singapore and Indonesia fall out of the top 20 into spots number 21 and 23. The youth poll is more worrying. This poll factors in interest working in the social enterprise sector and impact of having young people in the sector. Not one country in Asia, including Australia, is represented in the top 10.
The Youth Entrepreneurship in Asia and the Pacific 2019 report tells us that the situation for social entrepreneurs across the region is complex. The report describes a region of young entrepreneurs who take risk, who experience failure, but who are resilient and often start multiple social enterprises.
Compared to older entrepreneurs, youth are more likely to reach an operational phase of business. However, young social entrepreneurs often struggle with financial sustainability and therefore might find it more difficult to attract investment.
Despite this, where businesses are sustainable the social enterprise sector does attract capital and investment. This is despite the challenging economic environment in the region.
The report outlines some important differences between men and women social entrepreneurs in the Asia Pacific. Social entrepreneurship activity rates among women are higher than in non-social enterprise businesses. Sometimes, outcomes for young women entrepreneurs are worse than they are for young male entrepreneurs. This is because women tend to know fewer entrepreneurs, have lower skills perceptions, and higher fear of failing rates.
The G20, Thomson Reuters Foundation, and Global Entrepreneurship Monitor do not paint a complete picture of the current state of social entrepreneurship across the Asia Pacific. But they do provide insight into how the government and private sectors are working toward an environment that enables social entrepreneurs. They provide insight into how the sector is performing and where policy interventions may improve the performance of these businesses. Importantly, they demonstrate the need for continued and improved measurement of social enterprise, especially for young people and women, across the Asia Pacific region.
How the region responds to the complex intersection of challenges during this period of COVID-19 recovery will determine the next stage in history. It will require good policy and strong institutions that enable private sector business to thrive and deliver benefits for the community. A focus on social entrepreneurs tackling these global challenges through innovation and measured impact, should be a core component of how the Asia Pacific determines its future.
Erin Watson-Lynn is Australia’s Head Delegate to the W20 Saudi Arabia and has represented Australia at the W20 Japan and Argentina, G20 YEA China, and Y20 Turkey. Erin is a foreign affairs consultant who works with governments, universities and think tanks across the Indo-Pacific region.