Business with Purpose and the Rise of the Fourth Sector in Ibero-America : The world will fail to achieve the Sustainable Development Goals — here's how purpose-driven companies can fix that

With stagnating growth rates, increasing inequality and unwavering pollution rates across the developing and developed world, it is clearer than ever that our current economic framework, developed late in the 19th century, is under severe stress. At the current pace, we will not meet the Sustainable Development Goals set in the 2030 Agenda, an agenda which explicitly relies on the commitment of the private sector to succeed. We must all contribute to rethinking the functioning of the market and give it a new purpose. Only thus will we find a new development trajectory. Our current three-sector social and economic model (government, private sector and NGOs) is the place to start. This division seems to imply that businesses cannot have any other purpose than maximizing profit and shareholder value. But, as our study shows, this is not true. A new Fourth Sector of the economy, made up of for-social benefit and purpose-driven companies, is rising both in the world and in our region of Ibero-America; a region where roughly 10 % of the world’s population lives. The Fourth Sector represents 6 % of the total economy of the seven countries we have studied (Argentina, Brazil, Colombia, Chile, México, Portugal and Spain), which, in turn, account for 87 % of total Ibero-American GDP. This new Sector employs almost 10 million workers annually. The reasons behind this rise are manifold, and in the present work many are discussed, including the birth of an innovative regulatory framework in some countries in the region. But we would like to highlight one in particular: the arrival of a new generation of consumers and entrepreneurs who, against all odds, have started to search for purpose beyond revenue. This, the fact that the rise of the Fourth Sector is partly organic, is very encouraging news. However, much more needs to be done. In this study, we set some guidelines of where action should be directed, and what policies should be enacted to make this new ecosystem thrives. Only if we succeed at carrying them forth will we be able to build that prosperous, inclusive and sustainable future to which our region is profoundly and explicitly committed. Only thus will our economies reflect the nature of our citizens’ values, and will we be able to address the deep challenges of the 21st century.