Smallest of cogs can turn the biggest of wheels

2015. Statistics on poverty show that poverty has actually been on the rise. Hunger, the severest form of poverty, stalks 10 million more people across the world.
Recently, at the United Nations General Assembly, President Mugabe highlighted the importance for developing countries to proclaim zero tolerance to land degradation, and adopt effective land reclamation programs and green their land for food production and adaptation to climate change.
Poverty is not limited to Africa or Sub Saharan desert or developing countries. It has risen by 1,3 million in US, the world’s richest economy. 12,5 percent of the Americans are classified as poor compared to 12,1 percent in the previous year.
According to UNICEF, 22 000 children die each day due to poverty. The children “die quietly” in some of the poorest villages on earth, far away from the scrutiny and the conscience of the world. Being meek and weak in life sentence these dying multitudes, to even more invisible in death.
Infectious diseases continue to blight the lives of the poor across the world. Every year there are millions of deaths reported and unreported from HIV and AIDs and malaria. In Zimbabwe cancer deaths have been on the increase according to the Ministry of Health and Child Welfare.
Based on enrollment data, about 72 million children of primary school age in developing countries were not in school in 2005; 57 percent of them were girls. And these are regarded as optimistic numbers.
Distribution of poverty differs between African countries. It is reported that Uganda was reduced headcount poverty by 38,5 percent in the 1990s and Ghana reduced the same by 43 percent between 1992 and 2006. Zambia experienced growth in headcount poverty from 68 percent in 1990 to 73 percent in 1998, with a steeper increase in urban poverty. Zimbabwe experienced tremendous poverty growth during the structural adjustment period (1991-1995), but more particularly so during the period (1997-2008).
While there are pockets of fellow Zimbabweans who have done well to stay clear from poverty in their day to day lives, the majority of people are living in poverty. Even those that are “doing well” do not have to go far before they come across the realities of poverty, within their family and social circles.
Poverty is not confined to remote areas. Many professionals in cities are living in poverty. Many have had electricity cut off. Even more professionals can not afford medical aid subscriptions and medical expenses.
The problem of poverty cannot be solved simply through handouts. No amount of hand out can help an African farmer to compete with the Western farmers simply because the produce of the western farmer are subsidised at rates which are twice as much as the African farmer makes in the whole day.
Relief operations that supply handouts, also suffer from lack of transparency, accountability and efficiency in the delivery system. The problem is not only with disbursing governments but also with lending agencies and funding organisations.
In a recent television interview, Presidents Kagame of Rwanda, Martelly of Haiti and a UN official Dr Paul Farmer concurred that relief efforts did not make the desired impact in their respective countries, due to poor coordination and lack of accountability.
Much of the poverty in countries such as Zimbabwe does not make sense. The people are highly educated, disciplined and hardworking. The country is awash with natural resources. Yet, we see an increase in poverty. Wealth creation not riches should be our target. This requires the ability to see beyond our generation. Ever thought of giving as a way out of poverty?
Building strong and sustainable institutions provides a good starting point towards poverty eradication. An inheritance of strong institutions gives continuity to future generations. This calls for good governance in institutions providing water, electricity, transport, health, education etc.
Without sounding scientific, one could ask, if the quality of water during the years 1998-2008, could have been one of the factors which caused an increase in cancer related illnesses and deaths in Zimbabwe? What good governance practices in City of Harare, Zinwa etc, could have saved the nation from this demise?
What water reticulation systems are we passing on to the next generations? Are we proud to bequeath the likes of the hyacinth at Hunyani, the Mufakose water works to our children and their children? Once gain it requires taking our eyes off “self” and be others focused. Simple governance decisions at these water supply bodies have since created a gap between those that can afford bottled water and those who cannot. What message does the bottled water craze send to ordinary citizens?
In 2009, the Canadian government was reported to have spent more than US$10 million on bottled drinking water, and more than US$15 million in the previous five years. In 2008, the New York City Council had banned the use of bottled water in all its buildings, in line with the federal government policy. The UK also banned the use of bottled water in meetings, inorder to protect the environment.
The moral of these actions was contained in a statement by Simcha Felder, a Brooklyn councilman who said “It is a bit hypocritical for the city to be buying bottled water for city buildings while it is encouraging New Yorkers to drink city tap water”. World Council for Corporate Governance argues that the widening gap between rich and poor requires governance strategies to bridge it. The socio-economic disparities are a serious threat to security and sustainability of business.
How can good corporate governance contribute to poverty reduction? There is no one size fits all model for corporate governance and poverty reduction strategies. Corporate governance depends on other governances such as political and economic.
These governance systems tell a story of each country. Who better to tell that story than the country’s citizens? Each jurisdiction has a stock of factors which facilitate or impede the development of good governance. If citizens are not fluent in telling their own story, someone else will, but may not offer the correct solutions.
Corporate governance tells a story of our laws and regulations in Zimbabwe. It also portrays who we are as a people, in terms of the quality of directors, integrity, accountability levels and transparency etc. Interdependence on political and economic governance, means that the governance story will be impacted by e.g the colonial inheritances, all Chimurenga wars, including the land reform, failed structural adjustment programs, to name a few.
Thus, how well one articulates these factors, also known as drivers of change, within governance discourse will determine the levels of success of governance reforms or interventions.
In tackling poverty issues, businesses should make decisions in full view of the governance story, both past and present. Businesses, whether private, public or in NGOs, need to see themselves as part of a complex system, which overlaps and interlinks.
All economic transactions affect other people, even if that impact is indirect such as in housing, education, environment, pollution, health or social services. When businesses see themselves as part of a liner supply chain they make wrong decisions which increase poverty. It is that delicate and subtle.
This could be best illustrated by the 2002 revelations of child labour cases in West Africa and how business decisions at Nestle and Cadbury Schweppes were responsible for exacerbating poverty traps.
According to a report by USAID and International Institute of Tropical Agriculture, 75 percent of the world’s chocolate is harvested in countries such as Ivory Coast, Cameroon and Nigeria. An estimate of 200 000 people were working in the plantations in the Ivory Coast, of which 15 000 were slaves. Gross child labour and exploitations were taking place on the plantations.
In Zimbabwe, the child labour and dependence on gold panning “kukorokoza”, has an alarming impact on children being totally excluded from the education system. Children are exposed to adult life, and this has an impact on health and HIV and AIDS.
The lifestyles demanded by this population of “makorokoza, are menial Thus this population may never dream of services such as insurance, schooling for their children or to own a house. Perhaps it is in these remote mining areas where, children are dying quietly and are too meek and weak to be noticed.
Gold panners in various parts of Zimbabwe, always hopeful that they will one day unearth 100 grams of gold and make money, day after day the risk their lives.
Day after day poverty escalates. What laws and regulations govern this sector and activities?
Corporate governance systems at Fidelity and other institutional gold buyers should take this into account. This is about being connected consumers, about fair trade, about corporate citizenship and social responsibility as well as poverty reduction.
Nestle, Cadbury and the chocolate manufacturing industry later formed a group called the International Cocoa Initiative (ICI) to deal with problems of child labour and labour rights violation. The initiative has 10 projects in Ghana and Cote d’Ivoire. Some of the achievements according to December 2010 report on Ghana include that;
Most children in Ghana no longer spray cocoa farms, carry heavy loads, remove parasitic plants or weed large areas of land. There is a reported increase in enrolment and attendance rates in primary school and fewer children drop out. Poverty is the overarching issue; such initiatives should marry programs with economic development.
While this may serve as a best practice for Fidelity and gold buying industry in Zimbabwe, in tacking child labour issues and labour rights violations within the industry, this also shows the interconnectedness of poverty, governance and development, as well as the subtlety of this link.
Raising consciousness on how business decisions impact other people and the environment also raises the platform for corporate governance systems to play a role in poverty reduction. This responsibility cannot be left to foreigners. It is a Zimbabwean story. It must be told by Zimbabweans. It is our responsibility to give people the dignity they deserve. Let us allow the smallest of our good governance decisions to set poverty reduction in motion.
Even the smallest of cogs can turn the biggest of wheels.