Sunday
July 22
2012

Scott Anderson

Weekly Roundup: Oxford’s BoP Debate, Why ‘Old’ Arguments are Still Worth Our Time

“Penetration of soap at the very bottom of the pyramid is 98 percent in many countries,” said Patricia O’Hayer, of Unilever. “… 20 percent of children in certain countries, including Bangladesh, are dying of dysentery. If you’re going to try to tell me promoting hand washing campaigns and the usage of soap, which is already in their houses is a bad thing, I might have another opinion.”

“Public supplies of clean water would be much more effective than just washing your hands,” countered Kate Meagher, of London School of Economics.

“Agreed, but we don’t sell water systems,” O’Hayer replied.

That’s a snapshot of a discussion from “Responsible Capitalism or Business as Usual” a passionate and multi-faceted debate that has been pinging its way around the Web in recent weeks. Although now more than two months old, the forum hosted University of Oxford’s Saïd Business School, is worth your time. That little snippet also reveals that the tension between the role of private products and public infrastructure, is still as taut as ever.

For me, the somewhat ideological tone of the debate overall, and the above sub-debate in particular, was brought back to reality when a representative from Barefoot Power noted there are some villages where infrastructure, namely the electrical grid, will never reach. It’s why 20 percent of the world’s population is without power.

“I really do think it’s time to stop banging on about the grid, but to start really thinking about empowering solutions that can be established in the communities themselves,” said Lucy Symons of Barefoot Power. Symons incidentally noted that Barefoot is looking at setting up larger scale solar stations for villages.

The discussion brought together both champions and critics of BoP theory and strategies. And among them are many familiar names, including: Mita Samani, of the UK Department for International Development (DFID); John Hilary, of War on Want; Aneel Karnani, of the University of Michigan; John Madeley, author of ’Big Business, Small People’; Simon Maxwell, Climate Development Network; and Zahid Torres-Rahman, of Business Fights Poverty.

Following the discussion, the Centre for the New Economies of Development released a new site focused on the debate and other resources called Responsible BOP. You can watch the full debate in the video below. But if you don’t have time for the full hour and and a half, a few of key questions the debate engages include:

  • Do BoP strategies displace local jobs and merely create low-value chain jobs?

  • Do BoP focused businesses sap development and donor-funded NGO networks for their own gain?

  • Without sustained and massive investment, can multinationals truly make a positive impact on poverty alleviation?

  • Does direct foreign investment actually cause more harm than good for the poor, especially in the sectors of mining, fishing and agriculture?

Admittedly, many of the arguments (for and against) BoP strategies, as well as the criticisms may not be new to readers of NextBillion. For instance, how many more times must we endure the criticisms of Unilever’s Fair and Lovely? (It’s introduced at the Oxford discussion by Karnani.)

But in fairness to him, debates like this are important. Because everyone agrees that market engagement with the poor is important. The question always is how is that engagement is managed. Unilever’s Shakti program in India, which employs 45,000 women was touted by O’Hayer as a success story. (Check out a NextBillion post on Shakti). But Karnani unapologetically thinks it’s a “bad idea.” And since I picked on him earlier, I’ll give him the last word:

“You cannot just focus on the woman who got the job. You have to look at the whole picture. The woman selling (soap) maybe is displacing some other retailer. So we just cannot look at the narrow view of what this engagement is. We have to say: ‘What is this engagement and why is it good for the poor to engage like this.’”

(Hat tip: Social Enterprise Live)

In Case You Missed It … This Week on NextBillion

NexThought Monday: How ’Itty-bitty Multinantionals’ Can Serve the World’s Rising Middle Class By Erik MandellMercy Corps

Achieving Green and Inclusive Markets Through Public-Private Collaboration: A Bright Spot at Rio By Giulia Christianson and Sreyamsa Bairiganjan New Ventures

Gender Roles in Green and Inclusive Business – Replicating Old Patterns or Breaking New Ground? By Martin Herrndorf

A Jobs Tale: Recruiting Workers for Husk Power By Neha Kale Acumen

Guest Post: @ Rio+20 True Engagement: Discussions on Bringing the BoP into Product Development, Marketing By Filippo Veglio

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