New Business?NGO Partnerships Help the World’s Poorest

Wednesday, October 10, 2007

Innovative approaches to reduce poverty through trade are bringing business, NGOs, government and aid agencies together in new ways.

“We believe that the leading global companies of 2020 will be those that provide goods and services and reach new customers in ways that address the world?s major challenges ? including poverty, climate change, resource depletion, globalization and demographic shifts.”

This statement does not come from a United Nations (UN) conference or a non-governmental organization (NGO) congress. It comes from companies themselves ? among them Adidas, BP and Procter & Gamble ? in their ?Manifesto for tomorrow?s global business?, signed by eight major businesses, members of the World Business Council for Sustainable Development (WBCSD) Tomorrow?s Leaders group.

This example of corporate social responsibility (CSR) on a collective scale is not the only sign that businesses are becoming more socially responsible. Social entrepreneurship is also on the rise. These trends reflect a rise in partnerships between the profit and non-profit sectors.

As international businesses explore the developing world to find new consumer markets, firms are realizing that long-term prosperity depends on the development of these markets. As a result, more partnerships are springing up between international companies, NGOs and development agencies. They are finding common interests and learning from each other in the process.

A number of examples show that creative partnerships and approaches to reducing poverty through trade may be even more important than resources.

Unilever is integrating social innovation strategies in its business operations. In India, it teamed up with NGOs to create Shakti, a rural network that sells products adapted to rural customers in more than 100,000 villages, employing 31,000 women. In Indonesia, it teamed up with Oxfam to research and assess the impact of production and distribution processes on poor communities. (Sources: Unilever, Oxfam)

Electricit? de France is reaching people in rural areas without electricity through a range of partnerships. Its Energy Access programme is carried out with the World Bank, UN agencies, other multilateral and bilateral donors, NGOs and civil society to create small, locally run companies to provide electricity, water, gas and telephone services that stimulate local economic activity and contribute to wealth creation. The potential is huge: worldwide, 2 billion people still have no access to electricity. (Source: WBCSD)

Ashoka fellow Allan Schwartz worked with ITC to help boost exports from the wood sector in Mozambique, while allowing forest communities to preserve their environment. Local workers now produce high-quality wooden bracelets and have a reforesting plan. ITC helped with product adaption for various markets, quality assurance, marketing and distribution. (Source: Trade Forum)

Procter & Gamble worked with research institutes and other organizations to create a low-cost ($0.01/litre) water purification product. PuR is mixed with water and filtered through a cloth to remove bacteria, viruses and parasites. One billion people lack access to safe drinking water. Relief agencies use PuR to provide clean drinking water during emergency relief operations. (Source: P&G Health Sciences Institute)

A British Young Social Entrepreneur of the Year 2006 award shows how an eco-tourism resort in Mozambique can reduce poverty through trade. Built to environmentally friendly standards using local materials, techniques and labour, the resort employs 55 local staff, who in turn support over 500 family members (a third of the village). The concept will be duplicated in other locations. (Source:

Cemex, the world?s third largest construction materials firm, has been working with Ashoka fellows to help more than 30,000 low-income families to build affordable, decent houses for themselves. Participants enter a savings and credit programme, get assistance to plan construction work, and benefit from services such as material storage, delivery and price guarantees for two years. This helps the company reach new customers it could not serve before, while helping poor families to improve their living conditions. (Source: Ashoka, a global association of social entrepreneurs)
These examples show how appealing to a market of 4 billion people living on under $2 a day requires a radically different approach ? a more socially responsible one.

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Source: International Trade Forum (link opens in a new window)