Mekorot vice president says because Israeli market is small, Israeli innovators must adopt an international perspective.

Because the Israeli market is small, Israeli innovators must adopt an international perspective, and some of their best opportunities may now be in sustainable development around the world, experts agreed at a panel on Tuesday.

“Israel is designed to be global. Israel has no market,” said Sophie Blum, founder and president of the Proctor and Gamble Israel House of Innovation and vice president for marketing at Proctor and Gamble Eastern Europe Middle East Africa. “Israeli entrepreneurs have understood that and they think globally as of day one.”

Blum was speaking at a panel entitled “The Startup Nation Takes on the Sustainable Growth Challenge” at the annual convention of corporate responsibility organization Maala, held in Tel Aviv on Tuesday and sponsored by a relatively new project called the Appropriate Innovation Initiative.

About a year ago, the Appropriate Innovation Initiative began in order to create an ecosystem in Israel devoted to providing sustainable solutions for developing countries, according to information from the project. The initiative is a joint venture of three partners, the first being Maala, an umbrella organization of 130 of Israel’s largest companies that promotes corporate social and environmental responsibility (CSR). The second partner is Praxis, a consultant agency specializing in creating cross-industry cooperative ventures, and the third partner is the Heschel Center, a non-profit thinktank that focuses on sustainability leadership. The Appropriate Initiative aims to position Israel as a leading beta site for “appropriate, simple and sustainable innovations,” targeted to the needs of developing countries, the partners said.

“It’s very difficult to speak with Israeli companies about doing well by doing good when you only think about a local market,” said Momo Mahadev, CEO of Maala.

As people increasingly enter the lower rungs of the middle class in developing nations, they continue to be underserved in basic areas, such as energy, water, agriculture and education, explained Steve J. Puig, vice president for the private sector and non-sovereign guaranteed operations at the InterAmerican Development Bank. In all of these arenas “at the base of the pyramid,” Israeli cleantech innovators would find ample opportunities, he explained. Looking at Latin America, his own area of expertise, Puig said that rather than looking at giant markets like those of Mexico and Brazil, Israel should look to smaller countries where it “can be a big player.”

“Food is obviously the biggest portion of consumption that people have at the base of the pyramid,” he said. “Agricultural supply chains are very important.”

Likewise, many rural areas in India are also fertile ground for Israeli cleantech innovators, according to Sachin Joshin, director of the Center of Excellence for Sustainable Development (CII-ITC) in New Dehli. Around the world there are still 2.6 billion people who lack sanitation facilities and could benefit from waterless toilets that have the ability to recycle human waste into useable energy, Joshin said.

“For me 2.6 billion people around the world not having toilets – it’s not a market for a sanitary manufacturer, it’s a market for an energy company because it gives an energy source,” Joshin said.

Aside from such sanitation innovation, India could benefit from increased collaborations with Israeli entrepreneurs on agriculture and on water – particularly on managing water resources effectively, according to Joshin. Equally ripe opportunities include decentralized solar energy production modules, so that the so-called bottom of the pyramid, with no access to electricity, can begin to receive power, he added.

Israel’s national water company, Mekorot, is aiming to make its mark in these sustainability efforts abroad, and is already involved with many projects, including water decontamination in Buenos Aires’s La Plata River and desalination plant construction in Cyprus.

“I can say today that we solved the problem of the water in Israel,” said Rafi Ifergan, vice president of engineering and technology at Mekorot. “We solved it with a lot of know-how, a lot of knowledge, a lot of technology that we have especially from the Israeli industry.”

Transferring that know-how abroad not only helps populations in need but also is beneficial for Israeli “blue and white” promotion, according to Ifergan.

To make sure that Israeli cleantech entrepreneurs are really able to promote sustainable development both in the country and abroad, the Environmental Protection Ministry is more and more working with the industry and business sectors to stimulate green growth, added Alona Shefer-Karo, director-general of the Environmental Protection Ministry.

“We didn’t realize that our ministry is considered to be one of the biggest barriers to innovation,” she said, noting that industry members were exhausted from hearing the ministry say “no” to permit requests. “The whole ministry is now thinking how to make our regulation much more efficient, how to give to the industry long distance insurance so that the industry can plan its actions and development for the long-term.”

Shefer-Karo stressed that the ministry is eager to learn from industry stakeholders what areas of research are needed and what fields of knowledge are lacking, so that the office can direct research funds appropriately.