International Entrepreneurship: Role in Poverty and Sustainability

This essay delves into the realm of international entrepreneurship, examining its crucial role in addressing pressing global issues, particularly poverty and sustainability. Beginning with an introduction to the challenges facing the world, the essay references Muhammad Yunus's perspective on business as a tool for solving global problems. A comprehensive literature review supports this viewpoint, emphasizing the impact of globalization on various issues. The essay then explores the role of entrepreneurship in resolving poverty, highlighting the concept of social entrepreneurship and its different forms, with case studies like Avika Group. It further investigates the role of entrepreneurship in sustainability, including ecopreneurship and sustainable development goals. The essay concludes by reiterating the importance of entrepreneurial actions in fostering a sustainable and equitable world.

Running Head: INTERNATIONAL ENTREPRENEURSHIP1
International Entrepreneurship

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Table of Contents
Introduction......................................................................................................................................3
Literature Review............................................................................................................................3
Role of entrepreneurship as a solution to poverty........................................................................4
Benefits of businesses to alleviate Poverty..................................................................................6
Case Study of Avika....................................................................................................................6
Role of Entrepreneurship in Sustainability..................................................................................7
Barriers to Businesses to support Sustainability..............................................................................9
Entrepreneurial actions need to encourage................................................................................10
Conclusion.....................................................................................................................................10
References......................................................................................................................................12

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Introduction
With a long list of threats challenging the stability and long-term habitability of earth, it is very
difficult for the businesses to avoid their obligations to contribute to the global issues. In this
context, it can be stated that businesses cannot attain success in the world that is already falling.
In the today’s globalized environment, there are various global problems which are affecting the
growth of society. Some of the major issues are such as poverty, income inequality, education,
healthcare, human rights and climate change (Trivedi, 2010). To deal with these global
problems, leading international companies are learning that they can diminish the risk by
developing different solutions to the great challenges.
In this context, founder of Grameen Bank, Muhammad Yunus stated that “Business is a beautiful
mechanism to solve the global problems”. As a micro-finance pioneer, he has made various
efforts to deal with the global issues like poverty. By this statement, he wants to state that
business operations of a multinational company can assist the country to eliminate the risk of
different issues such as poverty, climate change, healthcare, education etc. This paper describes
the statement that is given by the founder of Grameen Bank, Muhammad Yunus. The statement
is reviewed by the use of literature and different theories. It describes the role of
entrepreneurship to resolve the global issues of poverty and sustainability. All the points are
discussed by including some case study examples.
Literature Review
According to Muhammad Yunus (2013), business is a very beautiful mechanism to resolve the
global issues, but businesses never use it for that objective (Ford, 2013). Entrepreneurs only
operate the business to earn money. It just fulfills the self-interest of business and entrepreneurs
but not a collective interest of society and global environment. The statement given by the
founder of Grameen Bank can be explained with the assistance of opinions of different authors.
According to Williams, Daly and Milner (2015), businesses cannot survive in a falling global
environment. There are so many issues like poverty and sustainability which have a huge impact
on the life of society. Avoiding social and environmental problems is not only bad for the earth
and its people, but it can be overwhelming to the economic growth and prosperity of a country

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(Williams, Dalyand Milner, 2015). In their article, the authors expressed further that the
globalized world confronts some most daunting challenges like perpetual conflict, poverty, water
scarcity, income inequality, climate change, poverty, lack of health care, unequal educational
opportunities and overcrowded urban areas. These are several issues which challenge the long-
term stability and habitability of world. These global problems have become more complex with
the passage of time (Haugh, and Talwar, 2016). Considering the world’s conditions and their
impact on business, business entrepreneurs now understood that it is in their own benefit to
become enthusiastic partners in resolving these global problems.
Figure 1: Most Important Global Problems
In this context, Korngold (2014) stated in his article that there are various global issues in which
businesses can do what the governments cannot. The reason behind this is that international
companies have the resources to resolve these issues. In his book, he has mentioned that global
firms have vast financial and human capital, international footprint, market power, financial
motivation and advanced technology which non-profits and governments do not have. The
companies can use these resources to deal with the global issues (Korngold, 2014).
Role of entrepreneurship as a solution to poverty
In today’s global environment, one of the major problems is poverty. Entrepreneurship plays an
important role in resolving an issue of poverty all over the world. The businesses need to engage

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in the social entrepreneurship by developing their organization as the social enterprise.
According to Cheng (2014), social entrepreneurship is the process to use of start-up firms and
other entrepreneurs to create, fund and execute the solutions to different cultural, environmental
and cultural issues. Moreover, a social entrepreneur is an idealistic leader who attains systematic,
sustainable and long-term social change via innovation (Cheng, 2014). Under their role as a
social entrepreneur, the businesses use different strategies and advanced technologies or their
combination. Zahra et. al, (2009) described that social entrepreneurs make diverse and
significant contributions to the societies and communities by adopting different business models
to provide innovative solutions to the persistent and difficult social and global problems. The
authors identified three kinds of social entrepreneurs i.e. Social Bricoleur, Social Constructionist
and Social Engineer. Social Bricoleurs are the entrepreneurs who generally emphasize on the
finding and talking about the small-scale domestic requirements (Zahra, et al, 2015). Social
Constructionists exploit the business opportunities and failures in the market by meeting the gaps
to the poor customers to launch innovations and reforms to a wide social system. Finally, the
third type of social entrepreneur is social engineers who identify global problems in the current
social structures and resolve them by announcing a revolutionary change. Due to this, these
social entrepreneurs generally damage the outmoded methods and replace them with the new and
more appropriate processes (Haugh, and Talwar, 2016). In this way, social entrepreneurs differ
in how they find out the social opportunities and find out their impacts on a wider social
structure and accumulate resources required to practice these business opportunities.
Furthermore, McMullen & Bergman (2017)has stated that social entrepreneurship concept has
developed a lot during current years.In simple words, social enterprise is a thought of a company
which seeks to produce profits and revenues while having a positive effect on the society and its
people. There are various social entrepreneurs who have shown their interest towards social
activities and they are promoting the social change (McMullen & Bergman, 2017). There are
various organizations in the world which worked to overcome the global issue of poverty.
Poverty is not just an economic issue but also a social issue. It is about the discrimination,
powerlessness, lack of freedom and lack of representation. It refers to the people, who go
hungry, lack accommodation, lack education and who cannot visit a doctor when they fall sick
(Stevens, Moray &Bruneel, 2015).

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There are some organizations in Australia like Freedom Cups and WaterSHED. Social initiatives
like Grameen Bank that was established by Muhammad Yunus in Bangladesh, have also brought
awareness to social enterprises as an innovative economic model. He figured out that lending
small firm to poor Bangladeshi villagers can assist lift the entire families out of poverty.
According to a report, for over 50 years, the World Bank, aid agencies, donor countries, national
governments and civil society firms have competed but they were not able to eliminate the
poverty.
Figure 2: Global Poverty Rates
According to Prahalad (2009), the businesses can eradicate the poverty by using Bottom of the
Pyramid theory. This is a socio-economic concept which enables people to group big segment
more than 4 billion of the poorest citizens creating an unserved and invisible market that is
blocked by barriers. This is the theory of entrepreneurship that includes partnering with the poor
to attain win-win situations where the underprivileged people are involved and at organizations
offering products and services to these people are beneficial (Prahalad, 2009). This association
between civil society, poor people, governments and large companies can develop the fastest and
largest emerging markets all over the world. Large-scale and wide-spread entrepreneurship is at
the center of the resolution to the global problem of poverty. Such a theory and approach is

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available in many examples like private firms, both small and large have successfully built the
markets at bottom of the pyramid as a mode of eradicating poverty (McMullen, 2011). In their
article, Vickers (2010) described the theory of institutional entrepreneurship that plays an
important role to overcome the global problems like poverty. Institutional entrepreneurship
occurs when group work to make drastic changes in the organization or society (Vickers, 2010).
Benefits of businesses to Alleviate Poverty
By alleviating the poverty, both the world and businesses may have the benefits. Activities of
poverty can enhance the performance of a business and build a better world in which it operates
its business. Businesses can play an important role to overcome this issue by creating the jobs for
poor society, accessing the goods or markets which benefit poor groups in the developing
economy markets. It assists the world to create wealthier, healthier and more skilled societies.
With the support of these businesses, the communities will offer the suppliers, customers, and
employees which organizations require for their sustainable development (Deyand Steyaert,
2016). Through social entrepreneurship; there may be various benefits to poor people. These
benefits are:
 More access to resources
 Employment
 Increase in the productivity
 Education
Case Study of Avika
One of the biggest case examples of this entrepreneurship is Avika Group that is founded by an
Indian woman rural entrepreneur Malvika Sharma. She established a venture that manufactured
hand-embroidered and traditional Indian clothes. Looking at the issue of poverty and inequality,
Avika provides employment to more than 700 rural women. To overcome the issue of poverty,
Malvika has worked as a social entrepreneur. This social enterprise was established to empower
the rural women via their economic growth. Under this, it has provided training and earning
opportunities by manufacturing hand-embroidered and traditional garments (Majid, Latif and
Koe, 2017). It played a major role to deal with the global problem like poverty and gender
inequality. To increase awareness about her social enterprise, Malvika used her business contacts
to conduct exhibitions at reputed organizations in the country like Wipro, Infosys, and TCS.

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Under this, the woman entrepreneur has confronted various challenges in the traditional male-
controlled society like India. The case study example of Avika assists in understanding the
unavoidable inter-twining of social and business issues in rural perspective.
Role of Entrepreneurship in Sustainability
Apart from this, another major global problem is sustainability. According to Hörisch (2015),
social entrepreneurship plays a vital role in the issue of sustainability. Sustainable
entrepreneurship can be described as the creation, detection and utilization of opportunities to
develop future products and services which sustain the communal and natural and provide
development benefits for others. The larger firms are bringing various transformative and radical
sustainability-oriented innovations. Schaltegger(2002) stated that the entrepreneurship that works
for sustainability is known as ecopreneurship. It is the most important form of environmental
management as the businesses are producing new products, services, and business models which
reduce the environmental impacts and enhance the life quality (Schaltegger, 2002). There are
various leading businesses which are engaged in the sustainable development goals to emphasize
their social, environmental and governance efforts. It assists to make sure that they continue to
play a role in creating a resilient world via economic development and opportunity when
addressing environmental and social needs.

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In this context, Hörisch (2015) stated that for example, sustainability entrepreneurship can put
pressure on the big organizations and their R&D divisions by providing the consumers more
sustainable products. In today's world, start-ups are creating benchmarks for the competitors and
enhancing the sustainability expectations of people. It needs the large organizations to enhance
their sustainability performance and effective of sustainability effects to cope with the threats
developed by sustainable start-ups (Hörisch, 2015). To deal with the global issue of
sustainability, entrepreneurship is sustaining its processes and activities. The entrepreneurs are
looking for creative ways to protect the environment or enhance the societal conditions by
offering new goods and services. In addition to this, they are using the methods which reduce the
harmful business activities while also creating profits for the entrepreneur. By always executing
the processes in better and innovative ways, entrepreneurship is very much relevant to the
businesses which are interested in sustainability (Kuhlman and Farrington, 2010).
Shepherd and Patzelt (2011) stated that there are various things which need to be sustained in the
process of developing sustainability. These points are given below:
 Sustaining nature
 Sustaining sources of life assistance

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 Sustaining communities (Shepherd and Patzelt, 2011)
According to Larderel (2009), there are various reasons why the businesses are becoming
sustainable towards the environment. Even, businesses shave so many benefits by focusing on
sustainability issues. One of the major reasons is that nowadays sound environmental
management has become the part of effective management practices of a business. The
businesses are using preventive approach by reducing and preventing wastes, discharges,
emissions, utilizing less toxic chemicals and enhancing energy efficiency. It is known as eco-
efficiency and cleaner production (Larderel, 2009). It is broadly identified as more efficient and
cost-effective. The companies have understood that sound environmental management becomes
a business advantage in today’s competitive market. The modern population is becoming very
concerned towards the environment and natural resources, so a company can enhance its brand
image by developing sustainability practices. The companies understand that a negative public
image can influence the market share of a company, community relations and investor’s interest
towards business (Deakins&Freel, 2009).
The most important reason why the businesses’ role is significant for sustainability management
is that business is a major part of this global problem. Now, the business is universally identified
as the primary mechanism for economic development and growth required to overcome the
poverty. The businesses need to implement more innovations and inventiveness to meet the
sustainable development challenges in the future. For instance, in the case of protection of ozone
layer, if the businesses had not been able to decrease the consumption, production, and emission
of ozone-exhausting substances, the levels of ozone-diminishing substances would have five
times more by the year 2050 than today (Corner & Ho, 2010).
At the beginning of 21stcentury, global firms dominated the global market, with 500
organizations accounting for 70% of an international business. These organizations conduct their
business operations in a way that is socially, environmentally and economically sustainable.
They are taking risks by putting their suppliers out of their operations and losing the assistance of
the community in which they run their business. The role of entrepreneurship can be defined by
defining another example of a case study. Navajo Nation, the biggest Native American tribe in
the United States developed an entrepreneurial undertaking (Shepherdand Patzelt, 2011). This
entrepreneurial venture develops environment-friendly building supplies by recycling the waste

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materials. In the United States, this firm not only creates the social, economic, cultural and
environmental value for Navajo Nation. In addition to this, it also contributes to maintaining the
native heritage of Navajo tribe.
Barriers to Businesses to support Sustainability
To support and implement sustainability, businesses may confront some challenges and barriers
in this globalized world. Entrepreneurs may find it very difficult to collect the data on
sustainability as the meaning of sustainability is different between organizations and sectors. It is
very complex for business leaders to create a business case for sustainability as the results are
generally intangible and provided for a long duration. In addition to this, the businesses which
are engaged to the sustainability feel it very complex to commit its team because of obsolete
opinions in global sustainability (Carroll and Buchholtz, 2014). The lack of physical results
makes it very difficult to analyze and report on the sustainability initiatives. Moreover, lack of
financial capital is one of the major barriers that prevent the entrepreneurs by weakening the
ability of entrepreneurs to serve the economy in developing markets. These are the major reasons
which lead the entrepreneurs to underestimate the expectations regarding the consumer demand
in the developing nations.
These are the barriers on which businesses need to focus and develop strategies so that it can
overcome these barriers to sustainability and other global problems. The businesses need to
encourage its sustainable actions to alleviate the issues related to protection of the environment
and its natural resources (Ngoc &Schbitzer, 2009).
Entrepreneurial actions need to encouraged
As mentioned above, modern businesses are making efforts to deal with the global problems like
poverty, sustainability, education, lack of effective healthcare etc. The larger business firms have
been showing significant efforts to enhance the quality of the environment. However, there are
various issues which are still unresolved and they will have a great effect on the earth. However,
many efforts have been made to enhance the higher involvement in sustainability practices
among businesses; its outcome is still far from satisfactory (Alvarez and Barney, 2014).
Moreover, the businesses need to develop some specific aspects in sustainable entrepreneurship.
These aspects are given below:

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 Develop economic gain
 Develop non-economic gains for the community people
 Develop social gain for the community
 Support economic growth of a country
To become more advanced and attentive, the businesses should focus on providing solutions to
the global problems. In this process, a single entrepreneur cannot do everything to resolve the
issues. It should encourage its workforce towards these global issues. It needs to conduct a
training and development program to make the people aware of the global problems like poverty
and sustainability. In addition to this, it needs to develop its resources and capabilities towards
sustainability. First, the businesses should gather the sufficient data and information on these
issues and understand the level of issues (McMullen & Bergman, 2017). After understanding the
issues, they should create a sustainable business structure to overcome the issues of
sustainability. Adopting a sustainable business system will help the businesses to support the
environment, community, and its people. Future sustainable entrepreneurship can include the
current body of knowledge by developing an understanding of the entrepreneurial processes for
sustaining the globalized communities.
Conclusion
From the above literature review and analysis, it can be stated that social entrepreneurship plays
an important role to overcome the global problems like poverty and sustainability. The statement
given by Yunus Muhammad i.e. business is a very beautiful mechanism to resolve the global
issues is very true as they support the communities and its people. If the companies support the
global problems, it will be in the benefits of both the businesses and globalized world. By the
development of social entrepreneurship, the businesses can deal with the issues. The businesses
can develop the ventures in different roles like Social Bricoleur, Social Constructionist and
Social Engineer which can support the globalized world and related issues. The above report
includes the role of entrepreneurship in sustainability and poverty issues. There are various
companies which are making profits and revenues by engaging in these social activities. From
the above analysis, it can be stated that business is a very beautiful mechanism to resolve the
global issues if the companies use in the right manner for the benefits of society and global
environment.

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