Building Policies that Enable and Incentivize Businesses to Leave No One Behind

Despite economic growth across Asia and the Pacific, many marginalized communities continue to face barriers to inclusion in the labor market and entrepreneurship. Existing business policies often fail to encourage private sector participation in inclusive growth, limiting opportunities for small enterprises and underrepresented groups, including women, youth, and persons with disabilities. The lack of incentives and enabling policies has hindered businesses from adopting inclusive business models that can drive sustainable development. ESCAP, in partnership with ASEAN and other stakeholders, has launched an initiative to create an enabling environment for inclusive business. This includes policy guidance, capacity building, and regional coordination to integrate inclusive business into national strategies. Progress is already evident in countries like Cambodia, Malaysia and Viet Nam, and the initiative is now expanding to other regions.

To tackle the barriers that prevent businesses from integrating inclusivity into their operations, ESCAP has launched a multi-pronged initiative aimed at fostering an enabling policy environment that incentivizes businesses to adopt inclusive business models. This initiative aligns with SDG 8 (Decent Work and Economic Growth) and SDG 9 (Industry, Innovation and Infrastructure) by promoting policies that encourage business practices benefiting marginalized communities.

A key component of the initiative is ESCAP’s technical assistance to governments in developing inclusive business frameworks. Through extensive research, policy dialogues, and capacity-building workshops, ESCAP has supported national policymakers in understanding and implementing regulatory and financial incentives that encourage private sector engagement in inclusive business practices. For example, in collaboration with ASEAN, iBAN, OECD, and national ministries, ESCAP has facilitated policy reviews and provided recommendations to integrate inclusive business criteria into national economic policies.

The initiative follows a participatory methodology involving government agencies, private sector leaders, and civil society organizations. This ensures that policies reflect the needs of businesses while addressing social challenges such as income inequality and limited access to economic opportunities. By working with private enterprises, ESCAP has encouraged companies to develop innovative business solutions that generate both financial returns and social impact.

A notable aspect of the initiative is peer learning across ASEAN member States. Successful inclusive business policies from countries such as the Viet Nam and the Philippines have been shared with other Asia-Pacific nations.

The initiative has led to significant outcomes. To date, several ASEAN countries—Cambodia, Lao PDR, Malaysia, Philippines, Thailand and Viet Nam, —have officially adopted strategies, policy measures or pilot programmes for inclusive business. For example, Cambodia adopted a national strategy to promote inclusive businesses. In Viet Nam, ESCAP’s engagement has contributed to the development of an Inclusive Business Accreditation System, providing recognition and support to companies that meet inclusivity criteria. Similarly, in Thailand, discussions are underway to institutionalize policies that support inclusive businesses through investment incentives and capacity-building programs. In addition, at the Sixth ASEAN Inclusive Business Summit, 19 organizations pledged to promote inclusive business, and ASEAN economic ministers adopted a regional Plan of Action in 2023 and endorsed the Model Framework for an Inclusive Business Accreditation System in ASEAN in 2024.

ESCAP’s initiative stands out due to its innovative approach to bridging the gap between economic policy and social impact. By embedding inclusive business incentives into regulatory frameworks, governments are shifting from a traditional economic growth model to one that prioritizes equitable development. Furthermore, the initiative enhances competitive advantage by encouraging businesses to tap into underserved markets, unlocking new growth opportunities.

Sustainability is a core aspect of the initiative. By embedding inclusive business models into national policies, the approach ensures long-term commitment from governments and businesses. The initiative has also fostered stronger partnerships between the public and private sectors, creating a foundation for sustained impact. Additionally, policy impact has been reinforced through cooperation agreements and regional integration efforts, promoting alignment across ASEAN economies. The endorsement by ASEAN Economic Ministers of the several strategic documents and the annual organisation of the ASEAN Inclusive Business Forums, including the Seventh ASEAN Inclusive Business Forum in Lao PDR in September 2024 and the Eighth ASEAN Inclusive Business Forum in Malaysia in 2025, underscores the institutionalization and future sustainability of the approach.

The replicability of the initiative is high, as it provides a scalable framework for other countries seeking to integrate inclusive business practices into their economic policies. The approach has been designed to be adaptable to different economic and regulatory environments, ensuring that lessons learned from one country can be effectively applied in others. Key conditions for replication include strong government commitment, active private sector participation, and mechanisms for ongoing monitoring and evaluation. For example, the Governments of Telangana (India) and Sri Lanka have also adopted policy measures to promote inclusive business models.

Lessons learned from the initiative highlight the importance of multi-stakeholder collaboration in designing effective policies. Engaging businesses early in the policymaking process has proven essential in ensuring buy-in and practical implementation. Additionally, leveraging South-South knowledge exchange has accelerated policy adoption and refinement, demonstrating the power of regional cooperation in advancing inclusive economic growth.

Through ESCAP’s ongoing efforts, the initiative continues to drive policy transformations that enable businesses to become engines of inclusive and sustainable development. By ensuring that economic policies incentivize inclusive business models, this approach paves the way for a more equitable and resilient Asia-Pacific region.