The Anti-Poverty Swindle

Corporate-driven development partnerships benefit their sponsors more than those in the Global South.

A Nike campaign targeting AIDs reduction. Think Retail

Over the summer, the secretary general of the United Nations, Ban Ki-Moon, spent a day in Silicon Valley trying to persuade tech leaders to play their part in the Sustainable Development Goals (SDGs), the UN’s new global framework that will guide development policies, priorities, and aid flows over the next fifteen years. “I need your support,” he reportedly pleaded. “You are the most brilliant innovators. What matters is that some creative and innovative people who have the entrepreneurial capacity help these visions be carried out.”

“That,” he told them, “is what the United Nations needs.”

It wasn’t the first time the UN chief expressed his faith in the intentions, creativity, and strategies of capital. For years he has touted big business as a “truly transformative force” whose goodwill and resources provide a “unique opportunity” to drive sustainable development.

His optimism echoes that of Simon Zadek, a recent contributor to Ban Ki-Moon’s High-level Panel on Global Sustainability whose 2008 article “Global Collaborative Governance, There is No Alternative” argued, “It is through collaboration, often involving the oddest bedfellows, that we vest this generation’s hope for effectively addressing the challenges of poverty, inequality, and environmental insecurity.”

For many development elites, corporations are partners not just for their financial largesse, but because they’re well suited to help in the design and implementation of poverty reduction programs. For example, Melanne Verveer, President Obama’s first ambassador for global women’s issues, hails corporations such as Walmart and Nike for their “game-changing” philanthropy, and Paloma Durán, who heads the UN’s Sustainable Development Fund, is working to involve businesses at every stage of development.

Indeed, the creation of the SDG framework (to replace the Millennium Development Goals), and the negotiations and discussions surrounding the process, has brought even greater visibility to the international development elite’s faith in corporations. SDG-related documents and reports show the growing role of corporations in development, and the hope among development elites that they can reduce the rhetorical, ideological, and methodological distance between corporations and the development world.

Corporations, these texts tell us, have come to recognize that promoting global equality isn’t a purely altruistic act — it is also in their own interest. “Companies realize that their ability to prosper and grow depends on the existence of a prosperous and sustainable society,” the United Nations Global Compact says, “and that deprivation and ecological destruction can have negative material impacts on supply chain, capital flows, and employee productivity.” The SDGs, other documents explain, present us with a unique opportunity to foster this growing corporate goodwill and philanthropic enthusiasm to turn “business into a truly transformative force in the post 2015 era.”

According to the World Investment Report and a recent UN Youth document, for instance, businesses are exceptionally equipped to support the poor by fostering “financial inclusiveness” and by changing the global business mindset through entrepreneurship education and relevant private-sector skills such as “Global Impact MBAs.”

For the NGOs and students who take their cues on development from the UN, the message seems clear: corporations are our partners, not our enemies. You reach out to them to ask for responsibility, not to demand accountability. You charm, not scold them.

It’s not just top-down development bodies that pressure NGOs and other institutions to cozy up to capital and adopt pro-market strategies, all while overlooking the role corporations play in driving poverty.

On June 24, FundsforNGOs, a global resource hub for NGOs, held a webinar called “Corporate Fundraising: Making an Effective Funding Case to Business.” Too often, the webinar’s website reads, “NGOs and corporations speak two different languages and look at the world with two conflicting perspectives.” With an eye toward creating a lingua franca, the webinar promises to “explore practical tips for NGO managers to engage, work with, and obtain funding from corporations — while keeping social policies, ethics, and reputations intact.”

The Foundation Center, another global resource hub for NGOs, similarly offers “Top Tips for Corporate Fundraising During Tough Times” and advice on “Securing Corporate Partnership,” urging NGOs to adjust themselves to the corporate logic of short-term profit and instructing them how to align their nonprofit goals with capital’s search for short-term investment returns (“Be able to communicate that you are a good investment now“).

High-Impact Investments

To be sure, the notion that capital’s know-how will strengthen the efficiency and impact of NGOs, and that the aims of businesses and development overlap, is not new. Far from speaking different languages, managerial culture, investment language, and capitalist logic have come to the development sphere over the past two decades. And as partners, board members, and philanthropists, corporate executives have eagerly adopted and re-appropriated social justice vocabularies.

Concurrently, corporations have long recognized that investing in NGOs and attaching their brands to trusted activist organizations — preferably those who represent “innocent victims,” such as children and women and, ideally, those who focus on the cultural and traditional practices that oppress them — is a lucrative way to protect their reputations and pacify opposition to corporate globalization. Increasingly, they rely on NGOs not just to legitimize their direct practices but also to normalize neoliberal, market-led development.

Conversely, NGOs have discovered that focusing on emerging markets, youth potential, education (particularly for girls), skill building, entrepreneurship, and behavioral changes makes companies perk up, allowing them to strengthen their brands and avoid costly regulation and oversight.

Transnational NGOs such as Save the Children, BRAC, the International Rescue Committee, CARE, Women Deliver, Vital Voices, Plan International, and the Population Council are among the growing group of NGOs that receive funding from corporations such as General Electric, Walmart, Adidas, Chevron, Unilever, Wells Fargo, Coca-Cola, Goldman Sachs, Nike, Johnson & Johnson, HRA Pharma, Bank of America, and JPMorgan to socialize and educate youth in the Global South along these pro-market lines.

When choosing their NGO and philanthropic partnerships, most of these companies are looking for “high-impact investments” that unleash the potential of the poor and unemployed to become self-reliant, market-oriented, private-sector workers and entrepreneurs, able to drive (and take responsibility for) economic growth.

Take Coca-Cola. Its donations stem from a desire to “help [them] understand the importance of self-reliance and the impact they all have on the future of the economy by addressing the issue of unemployment in Africa and helping to create a culture of entrepreneurship.”

Big banks such as JPMorgan, Wells Fargo, Citi, and Bank of America are among the multinationals that, in partnership with NGOs, invest in programs that purport to teach poor people resiliency, fiscal responsibility, and relevant skills. Citi, for example, supports programs that help “adults and youth adopt positive financial behaviors” with microfinance and entrepreneurship.

In 2014 alone, they paid more than $4 million to Junior Achievement, a global nonprofit youth organization that focuses on enterprise and financial literacy, to implement this vision in fifty-two countries. General Electric similarly empowers “people by helping them build the skills they need to succeed in a global economy.”

For corporations like Nike, Citibank, and Goldman Sachs — who locate the primary cause of global inequality in the exclusion of women and girls from the labor and credit market — breaking down barriers that prevent girls and women from entering the marketplace has become a major priority.

Though long promoted by international institutions like the World Bank, the Nike Foundation was one of the first major corporations to adopt and popularize this logic, declaring “adolescent girls as the world’s greatest untapped resource.” Since 2008, it has funded dozens of transnational NGOs and development institutions to promote the idea that poverty will be solved once girls view themselves differently, are valued as economic actors by their societies, and enjoy equal access to finance and business opportunities.

This view of girls as good investments — this idea that integrating girls in the market will produce the best economic outcomes — has, rhetorically at least, become dominant in the gender and development field, reshaping the ways in which development budgets are spent.

Unequal Partners

The growing dependency of NGOs on corporate funding and the attendant expansion of pro-market interventions are central aspects of what political scientists Peter Dauvergne and Genevieve LeBaron, authors of the book Protest Inc., call “the corporatization of activism.”

A key dimension of corporatization is a process in which “business charity has essentially replaced government funding in providing resources for social welfare and has become the so-called answer to social problems.” To the authors, corporatization “involves the politics of social activists internalizing a belief in the value of corporate responsibility, deregulation, and privatization.”

As a result, Dauvergne and LeBaron argue, “activist organizations have increasingly come to look, think and act like corporations” — even (though to a lesser degree) in the Global South, where corporatization is changing “the context within which such groups organize and serve their communities.”

Today, very few international NGOs call for a transformation of the global economic system, greater corporate accountability, or the enforcement of labor rights and workplace standards in corporate sweatshops. Instead, women’s leadership development, entrepreneurship (particularly in social enterprises), access to financial services, and sports programs for youth are the favored poverty-reduction strategies.

The corporatization of NGOs, however, is not a straightforward process. Partnerships take many forms, and the actors involved aren’t monolithic.

Oxfam is a good example. On the one hand, it’s proud of standing “at the forefront of partnerships between the business community and the NGO community.” But it’s also one of the few global groups that’s repeatedly called for structural economic reforms. Oxfam’s Dutch branch, Oxfam Novib, even funds the Brooklyn-based Center for Economic and Social Rights — a nonprofit that was one of the loudest voices for corporate accountability and private sector regulation during the SDG negotiations.

In April 2009, Oxfam’s Australian branch called out the company for empowering girls with money generated through the economic exploitation of other women — an obvious paradox for anyone concerned with female wellbeing, but one that’s distinctly uncomfortable for the NGOs that receive, or hope to obtain, grants from Nike’s Foundation.

I recently interviewed nine Nike Foundation partners, most of them grantee NGOs, and asked them whether they believed Nike Inc. honored “girl empowerment values” in its own supply chain. “No,” the obvious answer, was not given once. In other words, none of them was prepared to admit to Nike’s double standards on women’s rights. This is troubling because, while underreported, evidence of Nike’s ongoing sweatshop exploitation is easily accessible, particularly to the women’s rights community.

Instead, some of them declined to comment entirely and distanced themselves from the paradox by pointing out that Nike and the foundation are two separate entities, a dismissal that seemed to attest not to a shared indifference, but rather to a keen awareness of the ways in which a more critical engagement could actually jeopardize the work and jobs of their colleagues.

Others said they were not aware of any grievous workplace violations and that they believed that Nike had made a lot of progress since the sweatshop scandals of the nineties. Those who had, in fact, questioned their partners at the foundation about the labor issue seemed to have been subjected to the same branding techniques that make their corporate social responsibility reports appear so sincere — extensive listings of protocols, codes of conduct, flashy charts, impressive partners, constantly evolving monitoring systems and lots of optimism.

In other words, Nike’s “we’re not quite there yet, but are excited about the progress we’re making and the lessons we’re learning” narrative and their perceived or real influence over their budgets appear to be powerful tools in appeasing the foundation’s partners.

Rights, not Duties

Some might argue NGOs simply make a calculus — corporate intervention in exchange for long-term financial stability. Perhaps all the emphasis on girls has genuinely benefited the women’s rights community by enabling groups to pursue long-term projects and hire staff.

But research by the Association for Women’s Rights in Development (AWID) suggests otherwise. A 2012 report on the women’s rights funding landscape, which compiled survey data from 1,119 organizations from over 140 countries, concluded that the private sector’s interest in women and girls “should not confuse us into imagining that the private sector is emerging as the key investor in development.”

Financial assistance, the report explained, remains unreliable and project-based, with 48 percent of survey respondents reporting never having received core funding. “[T]he spotlight on women and girls,” they conclude, “seems to have had relatively little impact on improving the funding situation for a large majority of women’s organization around the world.”

AWID claims that many women’s groups are unsettled by the corporate fixation on girls and women as “smart investments.” And indeed, though corporations haven’t provided a steady stream of funding, their rhetorical power and growing boardroom presence has allowed them to shape women’s rights agendas. Apart from mystifying corporate accountability problems, the association argues that the “intervention of corporate actors in development can hinder [alternative models] due to their self-interest in maintaining neoliberal models.”

But if these concerns are as widespread as the survey suggests, how should we understand initiatives such as the Nike-backed Coalition of Adolescent Girls, in which over sixty prominent NGOs and institutions have aligned themselves with the shoe company under the banner “Poverty Ends With Her”? What should we make of the corporate-sponsored groups that promote savings accounts, self-reliance, sports, attitudes, and entrepreneurial opportunities as the key to poverty amelioration?

In addition to highlighting the problem of corporate control over advocacy groups, AWID also offers a solution: educate the private sector and persuade them to replace investment logic with a human rights purpose.

Without this process of learning — which requires a considerable degree of humility and respect for those who have been advancing this work, in many cases through sustained struggles for much longer — there is a real risk that “investing in women and girls” will soon be deemed a “failed strategy” and “consigned to history.”

This won’t do the trick. The shortcomings in corporate education campaigns and development interventions are not accidental — they reflect the prerogatives of capital. They cannot be educated or guided away.

This is why the new SDG development agenda is such a disappointment — it offers no mechanism for corporate accountability and effects no systemic change. As Paul Quintos, of the human rights NGO IBON International put it earlier this year, the framework further “expands and consolidates monopoly capitalist rule and safeguards the conditions for further capitalist accumulation.”

Other groups concur. The Center for Economic and Social Rights criticized the final document for containing “precious little [to] allay civil society fears about corporate ‘capture’ of development or reassure them about meaningful private sector regulation and accountability,” and the Trade Union Development Cooperation Network critiqued the SDGs’ financing agenda for achieving “little in terms of identifiable and concrete commitment, especially in the areas of international cooperation on tax, financial trade, and systemic issues” within the UN system. As a “demonstration of lowered ambition,” the Network fears the new framework will only perpetuate “a culture of exclusion.”

The transformation that is needed in the new development era is one of structures, not of people. Citizens of the Global South, of all ages and genders, deserve rights — not duties. Partnership and responsibility won’t generate a viable challenge to capital. Only mass social movements exerting pressure and demanding change can achieve the transformation the world’s poor so desperately need.

The good news is the avenues to accomplish this have not completely vanished. For instance, there’s the Treaty Alliance, a global collective of hundreds of civil society organizations and individuals pushing for the first binding treaty to regulate multinational corporations through inter-state cooperation and for a People’s Treaty, which pushes for accountability outside the UN system.

The Alliance played a key role in the UN Human Rights Council’s adoption of a resolution last June that — despite opposition from the US, UK, and twelve others — created an open-ended intergovernmental working group, mandated to “elaborate an international legally binding instrument to regulate, in international human rights law, the activities of transnational corporations and other business enterprises.” (It held its first session in July.)

The momentum the Alliance is now gathering, and the resources their members are creating and disseminating, is impressive. And the collective understands what drives social change. As a staffer for one member organization says, the groups share the belief that “[w]ithout mobilization and people’s pressure, we cannot change the current correlation of power.”

Perhaps they can help pivot away from a status quo that prizes women and girls as instruments of development and toward one that treats humans as ends in themselves, profits be damned.