C. K. Prahalad Discusses Development Through Private Enterprise

The World Resources Institute (WRI) and Nextbillion.net recently published a great interview with C. K. Prahalad on the role of private enterprise in development and poverty alleviation. Prahalad is the author of The Fortune at the Bottom of the Pyramid and one of the pioneers of the idea of BOP (the 4 billion people living on less than $2/day in developing countries).

One of the key points Prahalad makes during the interview is on sustainability in emerging markets. Often the efforts of developing countries to focus on sustainability are seen as detracting from their economic growth. Prahalad encourage a shift in focus from compliance with regulation to opportunities for innovation. He believes that the needs of the BOP will force businesses to understand social and environmental issues and become agents of change.

For example, I expect to see waterless detergents. I expect to see biodegradable packaging. I expect to see construction which is totally green. I also expect to see a lot more renewable energy sources. I think the world is begging for new business models, and I think the pressure is on, and therefore I expect a lot of innovations.

Prahalad also discusses how the idea of the role of private sector in poverty alleviation has become mainstream over the past five years and emphasizes the importance of highlighting success stories in this field (which is also one our of the goals here at TCI),

Success inspires others to follow. Part of it is good analytics, part of it is frameworks, but a lot of it is good models. Even if the model doesn’t apply to my company, the fact someone else has done it gives me the confidence to go try. So what we need is for iconic companies doing things at the bottom of the pyramid to be highly publicized.

The full interview can be seen Youtube and transcript is available here.