WEF: The Role of Equity in Green & Digital Transformation
What role does equity play in the global shift towards green and digital economies?
This question is at the heart of the World Economic Forumâs (WEF) report, Unlocking the Social Economy: Towards Equity in the Green and Digital Transitions. Developed in partnership with Deloitte and the Schwab Foundation, the report highlights the importance of equity in fostering inclusive growth while addressing inequalities in these transitions.
The report examines how social enterprisesâbusinesses focused on social and environmental impact rather than profitâare instrumental in this process. Their work aligns with the United Nations Sustainable Development Goals, such as reducing poverty, promoting decent work, minimising inequality and creating sustainable communities.
âEquality means that we treat everyone equallyâeach person or group of people is given the same resources and opportunities. Equity means that we provide resources and opportunities that fit the specific needs or circumstances of that person or group and in that way, we can reach an equal outcome.â
The WEF report
The WEF report outlines the opportunities and challenges presented by global green and digital transitions. While the green transition aims to decarbonise economies and create US$10.1tn in business opportunities and 395 million jobs by 2030, the digital economy already accounted for more than 15.5% of global GDP in 2022.
However, these transitions risk deepening inequalities if their benefits are not distributed equitably. Currently, 2.6 billion people lack reliable internet access and 760 million live without electricity.
Social enterprises, which number approximately 10 million globally and generate US$2tn annually, are uniquely positioned to address these disparities. As Daniel Nowack, Head of Social Innovation at the Schwab Foundation, puts it: âThe green and digital transitions are not just about technologyâthey are about people and their agency to drive change.â
Procurement professionals are central to ensuring that resources flow to initiatives that prioritise equity. By sourcing goods, services and solutions from social enterprises, organisations can directly support economic inclusion and sustainable growth.
Key Contributions of Social Enterprises
Creating inclusive employment opportunities
Social enterprises excel in addressing unemployment and skills gaps, particularly among underrepresented groups. By training and employing 200 million people globally, they are closing divides and ensuring that marginalised populations benefit from new opportunities in the green and digital economies.
Procurement can amplify this impact by integrating social enterprises into supply chains, prioritising partners that foster inclusive hiring and skill-building.
Ensuring access to affordable goods and services
Another critical contribution of social enterprises is their ability to make essential goods and services more accessible. Through innovative technologies, tiered pricing strategies and circular economy practices, they bring sustainability benefits to broader demographics, including underserved communities.
Procurement teams can support these efforts by sourcing products and solutions that prioritise accessibility and affordability, ensuring the benefits of green and digital innovations reach everyone.
Advancing financial inclusion
Social enterprises play a pivotal role in financial inclusion, providing nearly US$1.6tn in funding through impact investing, microfinance and fintech initiatives. These efforts empower grassroots communities to participate more fully in the green and digital economies.
Procurement strategies can align with these goals by prioritising suppliers and initiatives that champion financial inclusion and create pathways for traditionally excluded populations to thrive.
The importance of policy and collaboration
The report highlights the need for government action and public-private collaboration to foster equity in the green and digital transitions. Suggested measures include tax incentives, subsidies for essential products and embedding social criteria into procurement policies.
Procurement teams have an opportunity to lead by example, adopting policies that align with these recommendations and ensuring that purchasing decisions reflect broader sustainability and equity goals.
Procurement, a catalyst for change
As highlighted in WEFâs report, the green and digital transitions are not just technological shifts; they are fundamentally about people and their ability to participate equitably. Procurement professionals have a crucial role to play in enabling this participation by selecting suppliers and partners that prioritise equity, inclusion and sustainability.
Daniel captures the essence of this opportunity: âSocial innovation is a tool that allows everyone to be an actor in these massive transformationsânot just a subject to them. Social entrepreneurs are leading change by creating resilient jobs, expanding access to essential services and strengthening the foundations of a fair and equitable economy.â
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