HBS Engages Leaders from All Sectors to Examine the Role of Business in Alleviating Poverty

"The fundamental premise of our work as a business school is that business acts to the quality of life," says V. Kasturi ("Kash") Rangan, cochair of the Social Enterprise Initiative and the Malcolm P. McNair Professor of Marketing. "But the market systems, which business is grounded on, serve only about 2 to 2.5 billion of theworld's 6.2 billion people. We must do more." Rangan and John Quelch, Senior Associate Dean and the Lincoln Filene Professor of Business Administration, discussed this profound issue many times over the past couple of years, and together with Gustavo Herrero (MBA '76), executive director of the School's Latin America Research Center,they decided that the time was right for HBS to catalyze efforts within and beyond the School to address this issue.

"A Conference on Global Poverty: Business Solutions and Approaches," held over the course of three days in December 2005, brought together more than 100 leading academics (including 23 HBS professors),practitioners, executives, and government and nonprofit leaders topresent a unique multisectoral perspective on the issue of globalpoverty.

"The audience was outstanding," Quelch says. "We had 15 countriesrepresented with participants from a variety of backgrounds, whichserved as a catalyst for an information exchange among some of thetop minds on this topic. It was a testimony to the convening power ofthe School for intellectual stimulation and advancement of researchin this area."

"The fundamental premise of our work as a business school is that business acts to the quality of life."

—Kash Rangan,
Cochair, Social Enterprise Initiative

The conference focused on three central themes in the poverty fight:business challenges at the base of the pyramid, effective businessapproaches for reaching base of the pyramid markets, and understanding the roles of each sector in fighting global poverty. The sessions examined the social and economic impacts from a variety of perspectives, including those of multinational corporations, small and medium enterprises, and governmental and civil society actors."We must focus on how to make cross-sector partnerships work if we are to achieve scalable results," Quelch says. He notes the example of Starbucks working with conservationists and NGOs to form partnerships with small farmers growing beans in premium cultivationareas. "Ordinarily these farmers wouldn't have such an opportunity,"he explains. "Yet this is the sort of partnership that can have tremendous impact on people's lives."

Rangan points out that with an issue as complex and multilayered as poverty, academia can't hope tosolve the problem on its own. Rather, it can serve most effectively as a galvanizing force. He was impressed by the way academics and practitioners worked together during the sessions. "We have different approaches," Rangan says, "but there was mutual respect, and we helped each other. Almost every paper presented was coauthored by anacademic and a practitioner. This is unique. We could have made thisa very strict academic conference, but we wanted to spark something; we wanted people to share ideas." Indeed, Rangan and Senior Lecturer Michael Chu are already incorporating this topic into the MBA curriculum by teaching a course called Business Approaches to Serving Bottom-of-the-Pyramid Markets (informally known as "BaseBOP"); they plan to make the syllabus available to other schools in the near future. A book will also be published from the conference proceedings, withmore than 30 contributors included. The book will illustrate some ofthe models currently being used in the fight against poverty andanalyze their effectiveness. Rangan and Quelch both see theconference as an important first step in establishing the SocialEnterprise Initiative as a major intellectual force in this area inthe years to come.