These 6 social innovators are unlocking value in marginalized communities

Building a more inclusive economy and unlocking value in marginalized communities can go hand in hand, a new report suggests.

Published by the Schwab Foundation for Social Entrepreneurship in partnership with the World Economic Forum, the report shows how social innovators are “integrating racial equity into business practices and … unlocking additional economic growth worldwide”.

The study, Innovating for Equity: Unlocking Value for Communities and Businesses, highlights how businesses can partner with social value innovators to both help tackle exclusion and create economic benefit in three key ways.

These are by reaching new markets in diverse communities; by accessing talent pools that were previously untapped; and by broadening supplier networks to include sellers who may have been historically excluded or marginalized.

Without this approach, a “prosperity cap” is put on the global economy – in the United States alone, the widening racial wealth gap is predicted to cost the country up to $1.5 trillion in economic growth by 2028, the report states.

Here are six social innovators leading the way.

In Nigeria, Hello Tractor is an app that helps smallholder farmers rent and own tractors.

Set up by Founder and Chief Executive Officer, Jehiel Oliver, the app also helps tractor owners rent out their machinery.

Affordability is a big barrier to owning a tractor for the 60 million smallholder farms in sub-Saharan Africa. The cost of a used tractor in Nigeria can be more than three times a farmer’s annual income.

By helping farmers, the wider social value this innovation delivers includes boosting agricultural productivity. More crops mean more food, less hunger, better health and an improved economy for the local community. Hello Tractor is also encouraging entrepreneurship by helping farmers to own and hire out their own tractors.

In the United States, New York-based BlocPower is helping low-income Black and Hispanic residents bring low carbon heating systems into their buildings.

The company uses software to analyze a building’s potential for energy-efficient electric systems like heat pumps and removes the need for upfront payments by leasing the equipment over 10 to 20 years.

Energy costs and greenhouse gas emissions have been “significantly” reduced in the buildings upgraded so far, the report notes.

Led by CEO Donnel Baird, BlocPower is also delivering social value through a green jobs programme called Civilian Climate Corps that is delivering green construction training to thousands of Black and Hispanic people.

R3 Score is a social enterprise with a software tool that helps widen access to jobs and mainstream banking products for people with a criminal record.

The software more accurately assesses the risks associated with a candidate’s criminal history compared to traditional background checks. This in turn helps employers better assess the skills and capabilities of candidates “beyond their criminal records”, the report explains. The business was started by Co-founders Teresa Hodge and her daughter Laurin Leonard.

More than 30% of Americans have criminal records and these are disproportionately Black and Hispanic people. R3 Score is creating social value by boosting employment results for both businesses and jobseekers. A third of candidates whose records were screened with the software secured jobs they otherwise wouldn’t have been eligible for. These were mostly Black and Hispanic applicants.

Greyston Bakery is a bakery and social enterprise in New York that is creating social value by pioneering a no-barriers, no-bias recruitment process called Open Hiring.

No CVs or background checks are needed. Applicants enter their information into an online waiting list and when a position opens, they receive an offer. A full-time apprenticeship programme and career counselling help ensure employee success.

Greyston President and Chief Executive Officer, Joseph Kenner, now helps other businesses adopt Open Hiring and says he would like to see 40,000 jobs filled this way by 2030.

One of the company’s partners, a global cosmetics and skincare company, says more than 5,500 roles it has filled through Open Hiring are 60% people of colour and 60% women.

Stores using this approach have also seen a 10% increase in sales, the cosmetics company says.

Roots Studio helps artists from Indigenous and minority cultures to protect and licence their art.

Brands and retailers can buy photos and patterns from a protected online library. The system means designs can be traced and royalties paid both to communities of artists and the artist who created the work.

Indigenous communities lose an estimated $12 million in intellectual property rights from the $32 billion annual market for licensing cultural designs to print on fashion and other items.

The business is led by Co-Founder and Chief Executive Rebecca Hui, who has spent extended periods living with Indigenous peoples. Roots Studio is delivering social value by helping Indigenous and rural minority communities benefit from sustainable income and preserve their cultural heritage.

In Brazil, more than 60% of the country’s unemployed and underemployed workers are Afro-Brazilian.

PretaHub, based in São Paulo, is an organization that supports Black entrepreneurship by providing physical space, technical training, financial credit and access to retail and corporate networks.

Since it was started in 2002, PretaHub has supported more than 10,000 entrepreneurs, with more than $2 million invested. The company is delivering social value by integrating Black and Indigenous entrepreneurs into corporate supply chains and helping companies diversify what they buy.

PretaHub Chief Executive Officer, Adriana Barbosa, hopes to extend the model to neighbouring countries such as Colombia and Bolivia.