Friday, January 18, 2008

Fast-tracking poverty reduction

In the world of poverty reduction, shortcuts will not work, but there are various ways to speed up the process and increase the impact of projects (such as that mentioned in the previous post):

+For example, it is now popular to try to leverage your resources to gain other resources so that the impact of your contribution is bigger. Other resources could be from governments, other businesses, other partners or from local populations (remember that when locals have to contribute for something they always value it and respect it more).

+Another popular option is to organise a competitive process. The idea being that although the contribution only reaches (say) 5 people, (maybe) 15 people were inspired to try (and thus might continue even without your prize) and you can be sure the person/project you support is the best one to support. Competitions can be a great way to discover and promote new ideas especially.

+Partnerships, as always, can (though not always) create situations where the whole is greater than the sum of the parts, especially, if in the case of a poverty related project, the value of the in-kind contribution would otherwise be prohibitively high (products, labour, advice etc).

+Learning from previous lessons and sharing your lessons with others helps ensure that projects become iteratively better, and if your project was successful or developed some resources that can be useful for others, they should be promoted and shared to increase their impact.

+Although organising conferences is an old favourite of many, and criticised and expensive by many others, there is a need for these kinds of activities. Though much could more could be written on these, it is important such events have clearly defined goals, are designed to achieve those goals and is not an event in isolation. Ultimately some events, like the Global Clinton Initiative or TED have value incredibly greater than the cost of organising them, though for others I am not sure. Tip: if your conference is related to poverty reduction or environmental sustainability, don't have expensive or environmentally unsustainable events!

+Choosing between starting something new and potentially successful vs. selecting something already successful and scaling it up is difficult. Both are needed and both have great impact -ultimately the choice here will depend on the specific options available.

+Try to use human nature and the market, rather than always trying to change it (though there is a place for this as well). Even altering is easier than changing! The old saying of 'banging your head against a brick wall' is very valid and many people do not realise this. Though the temptation is to head straight for the target, a more convoluted path may, in fact, be better. Incentives and punishments need to be used in the right way and in the right combination.

Making a difference to education

Always a hot topic and ultimately the bedrock of creating a sustainable society, for without quality and accessible education there can be no government officials, judges, teachers, doctors, engineers, journalists etc and it will be harder to reduce corruption and inequality or increase participation.

It is common to focus on helping those who really need it, and making a massive difference to those who are disadvantaged and lack the opportunities that others have. This is not a bad thing, especially if the school or students have (or will have) a relationship to the company, i.e. by being in the company's 'local community'. Scholarships can be great especially if they are motivating others as well as those who get the scholarship, and if they are really helping the needy.

But, for these initiatives, a holistic perspective must be taken. The most needy might not apply for the scholarship or be able to take advantage if they have to care for their family or must work to earn income for their family (so does one provide a scholarship to the student and also cover the opportunity cost of that student not generating income?). A school might look great, but what is the quality of the teaching? In many poor areas, even with trained teachers and good facilities, is there ongoing support for the teachers and are the children actually healthy enough to attend school and concentrate?

A school is not just teachers and students, it is also head-teachers, local education officials, parents and even sisters/brothers. All of these (and more) are stakeholders in the school to varying extents and through participation ideas and efforts from all can be generated and then implemented. But participation does not come naturally and must be facilitated to ensure those who do not want to participate, who are afraid to participate, who are unable to participate -do participate.

Support also must take a long-term and wider perspective in order to understand any side-effects from the program. An extreme case could be that the government has money for the school, but because of a corporation's contribution, that money ends up in someone's pockets, but to all affective purposes, what the money was earmarked for was achieved and thus the books can easily be amended! And what about the other schools, or the other students, that do not get the support of the company -how do they feel? How can the support in one location rub-off onto others? Anything is possible as long as such an approach is taken.

This kind of effort is not easy, and this is why companies rarely do this themselves and instead partner with another organisation, but a company needs to understand the issues to thus select a suitable partner and help that partner (whose capacity may well be weak, if they operate in an area that needs help). Reducing poverty is not easy and as with the case in China, the poor are often stuck in a rut. A certain proportion can get out of poverty relatively easily, but for the rest, it takes a long time and a lot of effort.

How can a corporation make a difference?

If a corporation takes a broad aim of 'to improve the environment, to support education, to increase transparency' or anything else, for various reasons -selfish and altruistic, what are its best options?

Well, ultimately the biggest difference occurs from systemic changes and behaviour changes -none of which are easy, but which a corporation can support by working with government, with business associations and with initiatives (i.e. research, pilots, advocacy).

The next step would be to support others that are helping make systemic change; they are often doing this by raising awareness or improving accountability (naming and shaming, for example) and this could be the media or civil society or initiatives to build participation in decision making. This, again, often requires supporting existing initiatives and helping scale them up -or it could be to seed something new (but that will be sustainable or will have a defined end date).

Next could be to improve the ability for enforcement of laws and to improve the ability to meet legal requirements or implement legal reforms which may mean supporting NGOs, training government officials, training teachers, supporting training institutes, organising skills sharing etc. Supporting Universities can be a good way to support promising research, build capacity in teaching institutions etc.

Next, is the difference the corporation can make itself through its operations and its products. Making its operations more sustainable (Reducing waste, improving safety etc) and by developing products that are more sustainable.

Finally, once the corporation has got itself to a decent level it needs to start helping others reach this level, it needs to raise the bar. Not only does this provide massive benefit for the company in terms of PR, but it also raises the standard and forces its competitors to meet it. Best practise needs to be shared and others inspired to achieve. Influence should be used, especially on business partners and suppliers.

Ultimately it is the market that affects businesses and if the market mechanism is used to force others to improve, whilst the corporation stays ahead of the market, the corporation will always be first to market (since it is creating the market!). It is thus in its best interest to effect legal change that influences the market and to support the implementation of that legal change.