How the Business Community Can Help Alleviate Poverty Banner Image

Poverty can have adverse effects on business operations. Poverty is often associated with illiteracy, which can affect productivity. Employees with poor literacy skills may struggle to fully understand workflow instructions. Consequently, they are prone to making work-related mistakes, resulting in lost profits and reduced customer confidence.


Poverty can also have a profound impact on the community in which businesses operate. The lack of stable income may drive people to turn to illegal activity to survive. In addition, areas with rampant criminality can render a location unsuitable for business, which may cause companies to move to safer areas, perpetuating the cycle of poverty and crime in a community.

This negative cycle can be countered with a positive one: businesses can avoid these scenarios by helping to alleviate poverty. Businesses can have a positive impact on communities, and healthy communities are good for business.

Invest in Expertise- and Capacity-Building

One root cause of poverty is the lack of access to markets and resources. Businesses can address this by providing skills training and financing options to disadvantaged people and communities. Skills training helps citizens acquire the abilities to qualify for quality jobs. Financing helps poor communities set up cooperatives and enterprises to lift them out of poverty.

A bank, for instance, can offer microloans to people who want to start their own business. Some may not qualify for conventional bank loans because they have no collateral, steady employment or a verifiable credit history. As a result, they may be forced to borrow money from other sources, with extremely high interest rates that will take up a significant portion of their income. Microloans, in contrast, are small short-term loans with flexible repayment schedules. Microloans allow less fortunate business owners to earn more without risking defaulting on loans.

Invest in Women

Providing women with economic opportunities is another opportunity for companies to help alleviate poverty. If women are trained to be entrepreneurs, they can achieve financial stability independent of their husbands. In the event their husbands are unable to work, they can continue providing for their families, and their children’s quality of life will not be compromised.

Investing in women makes good business sense. If women have enough money for food, healthcare, education and other benefits for their family, their children have better opportunities to grow into healthy, educated and competent adults, translating to a highly productive workforce and viable consumer base.

Address Water Scarcity and Unsafe Sanitation

Water scarcity and unsafe sanitation lead to public health problems. A lack of clean water can drive people to utilize unsafe sources, leading to water-borne diseases such as diarrhea, hepatitis and cholera. Inadequate sanitation can result in ailments such as intestinal parasitic infections. These illnesses can lead to work absences and decreased employee productivity.

Businesses are addressing water scarcity and unsafe sanitation by helping communities obtain access to municipal water supplies, and by building safe and clean private toilets. Water is also essential for the maintenance of business facilities, so it follows that adequate water supply and safe sanitation will translate to healthier and more productive employees, as well as fully-functioning business facilities.

Businesses can help alleviate poverty with programs and projects that aim to improve the living conditions in underdeveloped communities. With the alleviation of poverty, people become more capable workers and professionals able to take advantage of the goods and services that businesses have to offer. When businesses thrive, so does the entire community.


ADEC Innovations (ADEC) is a leading provider of ESG solutions, with expertise in delivering fully-integrated consulting, software and data management services. To stay current on global sustainability issues, subscribe to our monthly newsletter, GreenWatch.


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