The world’s socio-economic systems exclude people from racially and ethnically marginalised backgrounds. An ever-worsening global challenge, this economic exclusion drives inequality in health and livelihoods and seeds social fragmentation. And it’s not just affecting billions of people, but businesses and the wider economy too. In the U.S. alone, the widening racial wealth gap will cost the country up to $1.5 trillion in economic growth by 2028. This translates to a cap on GDP growth of six percent.

To unlock this economic potential and create a socially just world, public and private sector leaders must advance the cause of excluded communities. They need to embrace solutions for integrating racial and ethnic equity into mainstream working practices. It’s how to bring millions of customers, employees, entrepreneurs and investors fully into the global economy and create a just, prosperous and thriving world.

Philanthropic organisations have an important role to play in this seismic shift. Taking a fresh look at this issue in our new report – Innovating for Equity: Unlocking Value for Communities and Businesses – the Schwab Foundation’s Global Alliance for Social Entrepreneurship and Echoing Green have pinpointed practical solutions that philanthropists can champion to drive impactful and positive change.

Our research shows that it is a smart decision – both in terms of social justice and economics – to support social innovators from historically marginalised groups.  By solving problems with ingenuity, social innovators are addressing the most intractable issues of their communities and the world. They are key to driving the meaningful, system-wide transformation that will benefit us all.

Philanthropic organisations can support these social innovators in three different ways:

Convene innovators

You can connect innovators by funding platforms that offer a vital network for marginalised entrepreneurs – putting them in touch with each other, potential customers and useful organisations. Such platforms can direct them towards support services that offer funding and expert advice, so they can grow and scale their operations.

For example, Adriana Barbosa created PretaHub for Afro-Brazilian entrepreneurs. Through a combination of credit provision and an online platform, it gives Brazil’s Black business community access to a robust network of retail and corporate customers.

As a Black businessperson herself, Barbosa understood that many of her peers lacked the capital, formal credentials and networks they needed to become successful vendors or suppliers of goods and services to Brazil’s mainstream corporations. That’s why she set about creating the right ecosystem. To date, PretaHub has supported over 10,000 entrepreneurs and facilitated $2 million of investment in their businesses.

By partnering and strengthening these networks, philanthropic organisations and other leaders can help ensure enterprises have the support needed to develop their products and grow their value proposition, lowering barriers to scaling the partnership.

Support emerging innovators

You could support an accelerator programme or other organisations that focus on supporting early-stage social innovators to help them scale up their new business models more rapidly. Such programmes provide them with startup capital, leadership development resources, and a forum for understanding both their specific business issues and their unique connection to the social challenges at the core of their mission. They fast-track success.

As a case in point, take the two founders of R3 Score – a U.S. technology business offering a novel approach to hiring practices that unlocks the talent pipeline of those with criminal records, an issue that disproportionately affects Black and Latinx candidates due to bias within the criminal justice system. Laurin Leonard and Teresa Hodge participated in both the Echoing Green Fellowship and the Techstars Impact Programme. These programmes allowed them to access funding, networks and coaching to create their initial value proposition.

As a result, Hodge and Leonard secured a major corporate champion. Driven by this executive leader, a Fortune 500 company sought to reduce its own hiring biases by using R3 Score’s services.

Campaign for collective action

Persuasive campaigns with meaningful calls-to-action are vital for tackling economic exclusion. You could support such a campaign on demands for policy change to accelerate the adoption of fair hiring practices.

For example, in the UK, there’s the Ban the Box campaign, which asks employers to remove the tick-box on job application forms asking candidates to confirm if they’ve ever held a criminal conviction. It allows people who have paid for their crimes to advance their career, while employers find the best person for each position.

Systemic racism and economic exclusion are holding back the economy, and in turn, entire communities.

Within these challenges lie incredible opportunities for organisations willing to think differently. By supporting innovators from overlooked communities to work hand-in-hand with mainstream business and key economic actors, philanthropists can help build a better future for everyone. A future that is more inclusive, sustainable, and thriving economically.

Cheryl L. Dorsey is President of Echoing Green

François Bonnici is Director of the Schwab Foundation and Head of Foundations at the World Economic Forum