From poverty to power - Oxfam-Québec

FROM POVERTY TO POWERLocal NGOs and academics got involved, alerting ‘Mr Fritz’,Shoprite’s ‘big boss’ in the capital, Lusaka, that the local communitywas threatening to burn down the store unless the company changedits ways. A university professor helped win over the company by settingout a plausible business case for local sourcing, given the unreliabilityof road transport links to South Africa. Thanks to a series of partnershipsbacked by Shoprite, farmers were able to raise their standards ofproduction, and the supermarket switched to local suppliers withoutsignificant reductions in quality or damage to its profitability.Shoprite is now expanding the scheme to its other stores in Zambia. 158A healthy private sector is essential in the fight against poverty andinequality. Private firms, large and small, must be able to turn a profit,but should do so in ways that strengthen national development andbenefit poor women and men.Companies can choose to adopt strategiesthat aim to profit by investing in, rather than by exploiting, theirworkforce, the environment, or the community.In the Shoprite example, active citizens used broad mobilisation(backed, admittedly, by the threat of violence) to successfully changecorporate policies and practices. Parallel to popular action, effectivestates must ensure that good companies are not undermined by bad,because in too many situations business pressures undermine goodintentions. In developing countries, states can help harness the privatesector for development by setting minimum standards for all, andshifting the centre of gravity from ‘exploit for profit’ to ‘invest for profit’.Measures include properly funding labour inspectorates and guaranteeingan enabling environment for businesses, particularly SMEs,through improved access to credit and technology. In the North,governments can use regulation to improve the development impactof TNCs, an issue discussed in Part 5.178