1963-2013 - 50 years of Research for Social Change

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Combating Poverty and Inequality: Structural Change, Social Policy and Politics

Programme Area: Special Events
Project Title: UNRISD Flagship Report: Combating Poverty and Inequality
No. of Pages: 360

From Chapter 9 – Business, Power and Poverty Reduction

This chapter discusses the complex relationship between business, poverty and poverty reduction. Business activities both cause and alleviate poverty, and poverty generates both costs and benefits for business. These diverse relationships give rise to varied and often polarized views regarding the new roles that business actors are assuming in the social and public arenas. Are such roles effective from the perspective of inclusive development? Do they do more to legitimise business-as-usual than enhance well-being? Can organized business interests play a constructive role in democratic governance, and if so, under what conditions? This chapter addresses these questions, paying particular attention to how transnational corporations and business associations facilitate or constrain poverty reduction via their relationship to public policy and more direct interventions associated with CSR and private standard setting.

This chapter is organized as follows
  • Section 1 of the chapter examines the effectiveness of recent developments in business practices and international development policy that aim to engage business more proactively in social development and poverty reduction. The remaining sections examine different dimensions of business power and influence, with a view to understanding when business is likely to play a constructive role in crafting models conducive to inclusive development.
  • Section 2 looks at the changing nature of state-business relations.
  • Section 3 examines the countervailing forces and social pressures associated with civil society and subaltern groups.
  • Section 4 explores variations in the preferences of different types of firms and industries.
  • Section 5 analyses the role of various types of collaborative institutions.
  • Section 6 highlights key policy implications of encouraging greater corporate accountability.

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