Poverty alleviation – what can the business sector do?

29 May

Press release

(29 May 2013) At a time when poverty alleviation tops Hong Kong’s policy agenda, the Bauhinia Foundation Research Centre released today a relevant research report, which aims at understanding the poverty issue in Hong Kong and providing constructive recommendations on how the business sector can extend the breadth and depth of its poverty reduction work.

The number of people living in poverty in Hong Kong rose from 1.14 million in 2003 to 1.19 million in the first half of 2012, which accounted for 17.6% of the total population (2011: 17.1%), according to figures from the Hong Kong Council of Social Service. Meanwhile, the city's Gini coefficient, an economic measure of income inequality, reached a record high of 0.537 in 2011, exceeding the warning level of 0.4 set by the United Nations.

The Centre’s Chairman Dr Donald Li said, “The poverty level and income inequality are still rising today, and Hong Kong is in urgent need of a solution in order to uphold the city’s competitiveness. The Centre agrees with a three-pronged approach, which involves the Government, the civic society and the business sector, as key to combating poverty.”

“However, given the business sector's resources, network, knowhow and experience, we believe it can contribute even more to supplement the poverty reduction work of the Government and other social institutions by adding more flexibility and variations.”

The report, entitled ‘Poverty alleviation – what can the business sector do?’, highlights the strengths of the business sector, including its extensive social network, access to resources and market information. These can play a part in helping ease poverty in Hong Kong, which to some extent is a result of economic restructuring and the limitation of public policies.

Lau Ming-wai, the Centre’s Vice-chairman and Convenor of the Study, said, “There is a lot more that the business sector can do apart from giving donations. The best way is to create a sustainable win-win situation where the businesses and individuals can both benefit. Through providing education support and employment opportunities, as well as awareness building, the private sector can combine its own competitive advantages with its commitment to corporate social responsibilities.”

In this regard, the Centre has put forth nine major policy recommendations under three areas, with the aim of tackling problems facing seven target groups, namely the working poor families, needy students, rehabilitated offenders, youth-at-risk, single-parent families, new arrivals, and the ethnic minorities, after examining some 1,000 projects for the underprivileged by commercial organisations of different sizes and in various sectors.

Education support

• Education and learning development: businesses are encouraged to offer scholarships and launch an incentive-driven reading scheme for children of low-income staff so that they could be more devoted to their studies and develop a good reading habit. The reading scheme may also feature book donations from other members of staff or publishers, and book sharing by senior executives.

• Vocational education and training: with the Government taking the lead, businesses are encouraged to set up new platforms of vocational education and training for youngsters from low-income families along with the latest development trends of industries in Hong Kong. The cruise industry, which the Government plans to further develop, is a good example.

• Social skills training: junior secondary students from underprivileged background should be given the opportunity to learn from experienced professionals from the private sector who can serve as mentors to help the students develop interpersonal skills, enhance competitiveness and explore a suitable career path. Senior executives and human resources professionals from the private sector may also consider offering job interview coaching sessions to the target groups.

• After-school tutoring and assistance: the business sector can help make after-school tutoring affordable to poor students by encouraging staff members to provide free tutoring and by offering food or venue sponsorship. It may also consider giving financial subsidies to students from low-income families to join online tuition classes.

Employment opportunities and support

• Internship and work opportunities: businesses are recommended to make available internship opportunities, especially for average students from low-income families. Other forms of assistance may involve providing the interns with living allowance, subsidising them to sit professional examinations, and offering permanent positions to the outstanding performers.

• Tailored job opportunities for people with special needs: to assist poor people who have difficulties working full time, restaurants and eateries are recommended to:

- sell breakfast sets or drinks to the target groups at discounted prices, and the target groups can resell the food and drinks to workers for a profit.

- offer food production training to low-skilled labour and consider hiring outstanding trainees afterwards.

Companies may consider allowing those who have completed relevant training courses to make breakfast in their office pantries and sell it to their staff members every morning.

• Assistance for business start-ups and self-employment: the business sector can reserve and release certain space of their commercial properties for the underprivileged to run pop-up stores, which are to be shortlisted and selected based on their business proposals. The business sector and welfare organisations may also jointly run marketing courses for the target groups.

Awareness building

• Nurturing youngsters with artistic talent: businesses are encouraged to offer scholarships and living allowance to youngsters with artistic talent, with the aim of financing their enrolment and studies at art schools.

• Building positive values and promoting mutual support: businesses to offer free services, such as haircut and home appliances maintenance, to the target groups. Businesses may also consider allowing charities to sell flags at their shopping malls.

In a bid to encourage the business sector to play a bigger role in poverty alleviation, the Centre proposes in the report the establishment of a new recognition system to award business leaders who have made poverty alleviation efforts in one way or the other.

To facilitate proper matching of resources, the report also suggests creating an online searching engine, which will help make information on the business sector's poverty reduction work available in just a few clicks.

Meanwhile, recognition by the Government on different occasions is expected to motivate businesses, especially the SMEs, to do more. Media coverage and tax incentives can serve as other forms of catalyst to boost contributions from the business sector, the study suggests.

“A win-win solution between the needy and the business sector can ensure the sustainability of poverty alleviation efforts. To this end, we hope the Government and the Commission on Poverty will consider the role of the business sector when crafting Hong Kong’s poverty policy, and our suggestions will stimulate more public discussions and eventually raise concerns for the needy for the sake of a more harmonious society,” Dr Li said.