Business and poverty reduction – the missing link?

Should your beer make you feel guilty? We are not talking the alcohol or calories, but its poverty impact.

Heineken is one of the first firms to go though the new MDG Scan developed by the Dutch that breaks down what multinational firms do in regard to the Millennium Development Goals (MDGs). This is a welcome development. There has been a lot of conference talk and coverage of business and the MDGs in recent years. Yet it has been hard to move beyond anecdotes to analytical data on private sector impacts on poverty reduction.

A Unilever-Oxfam study on the company’s impacts in Indonesia helped set a marker of what is possible. The new scan is another step forward, although only six firms - mostly Dutch - have so far undergone the scan and it tends to emphasize the positive. The challenge is to make sure it covers the range of operational impacts given that it is time and cost intensive to measure business impacts effectively.

The framework will soon be made available as a web-based tool for firms and also for NGOs. It will be interesting to look at the contributions of NGOs alongside those of companies they frequently critique.