In Brief
The Problem
Although growth has raised the standard of living in the developing world, more than a billion people remain in extreme poverty and outside the formal economy. Traditional corporate social responsibility programs have done little to alleviate the situation and rarely produce transformational change.
Why It Happens
Companies’ projects are not ambitious enough. Instead of trying to fix local problems, corporations and other actors need to reimagine the regional ecosystems in which they participate.
How to Fix It
Ecosystem reinvention requires searching for systemic, multisector opportunities and mobilizing complementary partners. Corporate financing can be supplemented with start-up capital from private and public organizations with a mission to alleviate poverty.
Global corporations and market-driven capitalism have generated tremendous growth since World War II, considerably reducing overall rates of poverty. That growth, however, has not benefited everyone. In developed economies, a small fraction of the population has captured the most recent gains, while many people in working-class rural and especially urban communities have experienced socioeconomic decline.