Reducing World Poverty: Companies and NGOs Expected to Collaborate—Page 2

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Panelists expressed particular concern over chronic poverty. “If you are 70 years old and blind, you need a welfare state,” said Duncan Green, Oxfam Head of Research. He pointed to huge inequalities experienced by people with disabilities, the elderly, and other “outsiders of the greater market economy” —citing the ‘Chronic Poverty Report’. Trivedy said that assisting people who are “harder to reach” with poverty reduction efforts was a challenge ahead until 2015.

The discussion turned to how best to tackle extreme poverty. Overall, Salon participants held divided views on which was the most effective approach: A slight majority said multinational business activity (41%), followed by government-to-government aid (31%), and then NGO-delivered aid programmes (25%).

Oxfam: Active citizenship to redistribute power

Green, author of a new book, 'From Poverty to Power', challenged the MDG dollar-a-day definition of poverty. Citing an earlier World Bank survey among 60,000 poor people, he said “Poverty is about relationships and politics. The technical dollar-a-day definition saps the life out of the discussion.”

The most effective approach to poverty reduction requires redistribution of power, opportunities and assets, argued Green. Such redistribution depends on two elements: active citizens and effective states. Talking about the role of an effective state, he referred to Botswana's management of diamonds, states in Asia and Latin America, and Korea (which was as poor as Sudan in 1958)—where “a competent and relatively authoritarian state ran a hands-on investment policy”. Democratic states tended to offer more equitable growth, and strong states are needed to “negotiate globalization”. He capped his presentation with a stirring Oxfam-produced promotional video to convey the points.

Trivedy agreed that active citizenship and effective states were crucial for reducing poverty. “Effective states must be capable of implementing policies through trained staff,” he added. “They must be accountable to citizens, through parliament and strong domestic media; and they must be responsive to citizens. It is important that citizens can make demands, even if the demands are not always met”.

Shell Foundation: Tackling market failure by scale

As global businesses have assessed their responsibilities to address poverty, their approaches have also evolved. Leach observed a shift from philanthropy, to responsible business practices, and to ‘engagement and responsibility’. Indeed, as our survey found, world opinion considers international companies to have the greatest responsibility for resolving poverty, along with international institutions and governments.

Outlining the Shell Foundation's business approach to poverty reduction, West urged businesses to go beyond giving to charity and acting responsibly, and to invest resources that develop functional markets and economies. “The business approach is to understand market failure, to tackle the problem, and create a self-financing system. Its focus is on customer, (not victims or beneficiaries), value added, and how they can pay.” For more on Enterprise Solutions to Poverty, click here.

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