3 ways businesses are addressing inequality in emerging markets
Harvard Business Review - 01/23/2015
Last year, the World Bank added a new mission to its original goal of reducing poverty:boosting shared prosperity. The change reflects the state of today’s world: the fraction of the global population in extreme poverty, defined as those earning less than $1.25 per day, has dropped to 12% from 36% in 1990. Yet income inequality is more pronounced than ever. According to a report released by Oxfam International on Monday, the richest 80 individuals in the world hold as much wealth as the poorest 3.5 billion. World Bank President Jim Kim has called this reality a “stain on our collective conscience,” explaining that boosting shared prosperity is the best way to fight inequality. We agree wholeheartedly with that approach. And we believe businesses must play a large role in making it happen.
Unlike extreme poverty remediation, shared prosperity cannot be accomplished solely by government handouts or even the well-meaning initiatives of NGOs. The first is not affordable and the second is often not scalable. Businesses can be a significant part of the solution. But they much more likely step in if they recognize that serving the masses is not about altruism or charity — it can be profitable in its own right.