Understanding Impact Business Models: Serving Underserved Populations

What is the intent of the Impact Business Model?    

How do I assess my company’s eligibility for this Impact Business Model?    

What are some examples of companies that have this impact?    

My company may be eligible for this IBM. How do I open this IBM in the B Impact Assessment?    

My company may be eligible for this IBM. What supporting information do we need to provide?    

Concepts in the B Impact Assessment

What is the intent of the Impact Business Model?

Companies can generate positive social impact by providing impactful products or services to underserved populations. The overarching principle of the Serving Underserved Populations (SUP) Impact Business Model (IBM) is that providing impactful products or services to an underserved population is more impactful for society than providing those same products/services to populations who do not face significant socioeconomic challenges. By providing impactful services such as healthcare, education, and access to employment opportunities, a company can help improve socioeconomic outcomes for underserved populations. 

The Serving Underserved Populations Impact Business Model is found in the Customers Impact Area of the B Impact Assessment. SUP can only be applied if the company is earning another Customer IBM first (e.g., Health and Wellness, Economic Empowerment, Impact Improvement, Education, Support for Purpose Driven Enterprises Impact Business Models). This is because the B Impact Assessment (BIA) does not capture non-impactful products/services sold to underserved populations since the intent is to create socioeconomic outcomes for the population served.

How do I assess my company’s eligibility for this Impact Business Model?  

An important criterion of the Serving Underserved Populations IBM is that the recipients of the product/service should also be captured in another Customer IBM, and should be determined to be “underserved” as defined by the B Impact Assessment. 

“Underserved” in the BIA refers to individuals who face socioeconomic challenges and barriers to quality of life as a result of being low-income, being part of a marginalized group, or lacking opportunities for education and employment that others in one’s community or region have access to. This classification highly depends on the regional context, as demographics, politics, societal attitudes, culture, and economics differ greatly across different regions. 

A key point to note is that being “underrepresented” (i.e., diversity in a group) is different from being “underserved.” “Underrepresented” means one is part of a minority group that does not have much visibility, whereas being “underserved” means one experiences socioeconomic challenges and barriers to quality of life (often as a result of being underrepresented). While being underrepresented and being underserved may often go hand-in-hand, keep in mind that being part of a minority does not always mean one is “underserved” (e.g., white people of European Ancestry in South Africa). 

What are some examples of companies that have this impact?

Some examples of companies capturing impact in the Serving Underserved Populations Impact Business Model include:  

• A company that provides tele-healthcare services to elderly and poor populations in rural communities in South Korea is earning SUP for providing access to healthcare for an underserved group with limited access. 

• A company that provides banking services to communities that were previously unbanked, and thus increasing economic opportunities for individuals from underserved communities. 

• A company that provides writing and publishing services and is earning SUP for their program to support underrepresented voices in the industry through specific programs for authors from racial and ethnic minorities. 

Please note that these examples are non-exhaustive and illustrative. 

My company may be eligible for this IBM. How do I open this IBM in the B Impact Assessment? 

If you are considering opting into this IBM, you will have to answer specific questions about the impact of your product/service that will determine which Impact Business Models you see in your BIA. These questions, called gating questions, ensure that you see the content that is most relevant to your company in your assessment. 

To find the gating questions for the IBM, navigate to the Customer Impact Area and search for the questions titled “Customer Impact Business Model Introduction” and “Customer Focus of Product or Service.”  Respond “Yes” to these questions. 

This will open the “Beneficial Product Type”  which must select an option, any option, to see the additional gating question for this ‘child’ Impact Business Model. See the question titled “Impact on Underserved Populations”, either of the two answer options highlighted below will open this IBM. Their differences are explained below.

For the question “Impact on Underserved Populations”, select one of the two answer options that gate into this Impact Business Model. 

The main difference between the answer options is whether the company directly serves the underserved populations or has clients who serve underserved populations.

My company may be eligible for this IBM. What supporting information do we need to provide?  

Some information or documents that can be provided for capturing impact for this IBM can be: 

• Customer demographic surveys, customer enrollment in government benefits that verify underserved status.

• Customer surveys that evaluate the access to the type of products provided by the company to underserved populations.

• Description of how the company uses census data, government statistics, or reputable NGO/university studies on the specific markets/populations they serve.

• Description of how the company directly surveys beneficiaries of their customers, or if their clients collect demographic data about their underserved customers.

• Description of how the company uses client reports or case studies to determine that the clients intentionally serve underserved individuals.

Concepts in the B Impact Assessment

Beneficiary - An individual for which your company intends to provide a positive impact through its products/services. For some companies "beneficiaries" and "customers/clients" mean the same thing, while for other companies they will be distinct.
For example, a company that sells professional development courses to individuals would consider both its customers and beneficiaries to be the individuals it serves. However, a company that sells solar-powered lanterns to NGOs in emerging markets, which in turn distributes them to underserved individuals, would consider its clients to be the NGOs and its beneficiaries to be the end-users of its product.
Clients refer to the buyers of your company's products and services (IRIS Glossary Term). The terms "clients" and "customers" are sometimes used interchangeably. "Customers" generally refers to individuals, while "clients" generally refers to organizations.
Low Income - Definitions for "low income" vary by geography, but those that are generally accepted in the BIA are based on generally accepted definitions (e.g., government definitions), rely on reputable socioeconomic data, and/or focus on small-scale geographic areas (i.e., a regional or local income threshold is more likely to be accepted than a national one). Companies should be prepared to explain the methodology, income thresholds, and data sources referenced.

Low Income - Low-income people are individuals or households living above the poverty line but below the national median income.

Poor -  Using a consumption-based approach to measure poverty, the poor are defined as individuals or households living below a recognized poverty line. Poverty lines establish the minimum income or expenditure that would meet a household’s basic needs. Commonly recognized poverty lines include (1) the national poverty line set by the national government and (2) the international US $3.20 per person per day expenditure at 2011 Purchasing Power Parity (PPP).

Very Poor -  Using a consumption-based approach to measure poverty, the very poor are individuals or households living below a recognized extreme poverty line. Poverty lines establish the minimum income or expenditure that would meet a household’s basic needs. The $1.90 per person per day 2011 PPP line is the World Bank’s current definition of extreme poverty. Another commonly used measure of very poor is individuals or households in the bottom 20% of the national population.

Underserved - Underserved is a term used throughout the BIA to describe groups (e.g. populations, individuals, communities, enterprises) that do not traditionally have access to the positive social or economic outcomes delivered by an impactful product or service. Low income, poor, or very poor individuals as well as low income geographic areas are always considered "underserved" in the BIA.

Non-income based definitions of "underserved" may also be considered in the BIA, but will vary widely by context and by geography. Accepted definitions are typically supported by evidence that a group lacks access to the company's positive intervention due to chronic discrimination in a particular market, which may include discrimination based on gender, race, ethnicity, color, disability, political opinion, sexual orientation, age, religion, or social origin.