Digital platform firms are now integral players in today’s global economy. With sky-high valuations and far-reaching influence, these companies have become a dominant force across various industries. Platforms certainly have grown from a small corner of the economy to become a global phenomenon. So what exactly is the platform economy?
The platform economy is economic and social activity facilitated by platforms. Such platforms are typically online sales or technology frameworks. By far the most common type are “transaction platforms”, also known as “digital matchmakers”. Examples of transaction platforms include Amazon, Airbnb, Uber, and Baidu.
Platforms have been instrumental in driving growth and boosting the digital economy of Southeast Asia. By providing necessary physical and digital infrastructure, as well as access to convenience for consumers and micro, small and medium enterprises (MSME), they are enabling unprecedented levels of development across the region.
As the Platform Economy continues to evolve across regions, countries must evaluate and consider a range of challenges that come along with it. The rise of the gig economy has caused many stakeholders to consider ESG implications regarding internet platforms. On-demand services provide employment opportunities and convenience at an affordable price, yet have come under scrutiny due to worker treatment concerns that could affect investors’ decisions or draw attention from regulators. Singapore is leading the way with regulations aiming to strengthen protections for platform workers, which may set a precedent in other countries and make worker treatment an important financial consideration within this sector’s ESG framework.
One of our clients in Asia hosted Sangeet Paul Choudhary, a renowned tech business adviser and author of two essential popular press books on the platform economy – Platform Scale and Platform Revolution – who discussed innovative approaches to update gig work protections while analyzing their potential effects on existing platforms.
Some of the questions which we were discussed over the engagement session:
- Does the platform business model inherently run the risk of exploiting workers?
- What are the key regulations being evaluated by regulators globally?
- How are successful platforms adapting to changes in the regulatory environment?
Sangeet Paul Choudary is the best-selling author of multiple books, including Platform Revolution and Platform Scale. He has advised the leadership of more than 40 of the Fortune 500 firms and has been selected as a Young Global Leader by the World Economic Forum. Sangeet’s work on platforms has been selected by Harvard Business Review as one of the top 10 ideas in strategy and has been featured on four occasions in the HBR Top 10 Must Reads compilations.Sangeet is appointed to advisory boards and committees at several Global 2000 firms and government bodies and he is a frequent keynote speaker at leading global forums including the G20 Summit, the World50 Summit, the United Nations, and the World Economic Forum.