What businesses should do to address growing inequalities

Saturday May 25 2019

poverty

We have hundreds of millions of people living in extreme poverty while huge rewards go to those at the top. ILLUSTRATION | NATION MEDIA GROUP 

BOB COLLYMORE
By BOB COLLYMORE
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One of the things that I like about Nairobi’s Upper Hill area is that you can enjoy some of the most panoramic views of the city from vantage points of the gleaming buildings that have come up in the area and its surroundings.

Yet Nairobi, and many of the cities in which we live in, have another side to them; a side that we all probably know.

According to Oxfam, the richest 10 per cent of people in Kenya earned on average 23 times more than the poorest 10 per cent, while a girl from a poor family in Kenya has a one in 250 chance of continuing her studies beyond secondary school.

The picture is almost the same across the continent.

The inequality problem we face today is not limited to Africa. As a matter of fact, it is the norm on the global arena.

Take Washington state’s tax system for example. Reports compiled by independent analysts show that poor residents pay 16.8 per cent of family income in state and local taxes while the wealthiest one per cent pay only 2.4 per cent.

POVERTY

These statistics point to a grim and growing reality that inequality is increasing rapidly across the world.

We have hundreds of millions of people living in extreme poverty while huge rewards go to those at the top. Meanwhile, the world’s poorest are getting poorer.

This state of affairs is not sustainable. Over the long term, business cannot succeed where society is failing, and the reality is that the existing models of business are not generating enough value to contribute to societal good.

Now more than ever there is a clear call to action to businesses to adopt the Sustainable Development Goals (SDGs); the call for private sector to innovate and develop products and services that meet the needs of the customer.

But the truth is, no one sector — public, private or NGO — has the capacity to address the fundamental business and social challenges that we face today. And that is why collaborative and inclusive approaches to business and cross sectoral partnerships are critical.

INCLUSIVITY

If not addressed, inequalities will ultimately create a political and business landscape that will be difficult to reverse — we see this in the US and in Brexit. Faced with this global challenge of inequality, what should businesses do?

Firstly, we must adopt inclusive business approaches. Let’s think seriously about how to create employment for the youth; how we can do businesses more with women-led firms, and the SME sector.

Secondly, we must address corruption. This scourge which causes a significant haemorrhage of the economy, drives inefficiencies, drives up prices, widens the inequality gulf and deprives government of revenue that should be used to deliver services.

Thirdly, we must be responsible and transparent taxpayers. We cannot avoid or evade taxes and then take the high road of criticising the corrupt or poor government services.

COLLABORATION

And finally, we must tackle inequalities in the workplace — as businesses grow, we also need to self-examine how pertinent business questions such as how we are performing on gender pay gaps or gaps between executive salaries and median salaries.

The public sector then needs to create an enabling environment while those of us in the private sector need to drive delivery of products and services that will transform the society for the better.

Civil society should provide the links to community and support accountability all through.

When we bring all these players together, you create what I like to call constructive value — which suggests that when you add one plus one you get something that is greater than two.

What are we at Safaricom doing about all this?

COMMITMENT

In 2016, we started the process of integrating nine out of the 17 SDGs into our core business strategy.

We have since then registered significant impact and transformation through our products in health, education, agriculture; our advocacy and partnership efforts in anti-corruption; our ambitious target of being a Net-Zero Carbon Emitting Company by 2050; and our focus on building an inclusive supply chain.

We did this because we believe that the SDGs provide the opportunity to really engage in a purpose-driven business, and business that is both sustainable and inclusive.

Our rallying call then is we must all rethink our business models and strategies and see how to address the growing inequalities.

The writer is the CEO, Safaricom

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