What’s the first thing that comes to your mind when we mention the word ‘poverty’?
Images of hungry people, is my best guess.
Most people don’t associate the poor with potential and possibilities. And, that is why the world’s investors have been ignoring a five trillion dollar international market.
But not for much longer.
The University of Sydney Business School is teaching its postgraduate students how to fight poverty while tapping on the enormous potential of the Base of the Pyramid, the poorest but largest segment of the world’s population.
It’s time to look at an age-old problem in brand new light, we say.
A unique course that teaches a new approach to fighting poverty
Associate Professor Ranjit Voola has developed a unit titled ‘Poverty Alleviation and Profitability’ for around 50 students engaged in the CEMS Masters in International Management. The course is unique in its content in Australia and, the University of Sydney Business School is among the first CEMS partner to introduce the unit into its curriculum.
CEMS is an elite global alliance of 29 Business Schools, which includes the University of Sydney Business School.
The unit aims to encourage students to radically rethink the traditional business focus on the prosperous middle class markets and engage with the world’s poor. However, as Dr Voola emphasised, “We are not talking about exploitation, but rather, a novel role for business in poverty alleviation.”
According to Dr Voola, there is now both moral and economic imperative for businesses to become involved in the domain of poverty alleviation, which had previously been the exclusive domain of not-for-profits, governments and multinational organisations like the World Bank.
How can businesses help alleviate poverty, profitably?
Businesses that focus on alleviating poverty are often called social enterprises. Dr Voola highlighted two such companies that are fulfilling both aims of poverty alleviation and profitability.
Saathi, a small start-up, has found an innovative way of providing Indian women with affordable access to sanitary protection and a sustainable business.
The company has developed a way of making sanitary products from banana fibre (say what?) and has partnered with local women entrepreneurs who manufacture and distribute the products. In India, where the lack of access to affordable sanitary protection robs around 200 million women of vital work and educational opportunities, this business model engages the poor as both consumers and producers.
Safaricom/Vodafone M-Pesa, a venture in Kenya, enables money transfers and access to microfinance via a mobile phone. According to Dr Voola, this enhances financial literacy and financial inclusion amongst the poor.
The private sector holds the key to the future of poverty alleviation.
The course would call upon a paradigm shift in long-held beliefs of poverty alleviation. Students would have to rethink all that they have been taught about business priorities and risks in developed marketplaces, and consider business strategies that target illiterate people with very little money and who currently operate in an informal economy.
Dr Voola added, “We are also asking them to base their engagement with these people on social justice principles.”
The UN now recognises that the private sector will eventually have a leading role to play in the alleviation of poverty.
“By 2050, the world’s population is forecast to be 9.3 billion, with a significant percentage who are poor”, Dr Voola concluded.
And if the statistics are anything to go by, entrepreneurs had better see the poor as the new rich.