A new approach to fight poverty and vulnerability: The redistributive enterprise

• Author: Fabio Daneri
• Position: University of New York Tirana
• Pages: 21-26

21

IIPCCL Publishing, Tirana-Albania

Academic Journal of Business, Administration, Law and Social Sciences Vol. 1 No. 3

November 2015

ISSN 2410-3918

Acces online at www.iipccl.org

A new approach to fight poverty and vulnerability:

The redistributive enterprise

Fabio Daneri

University of New York Tirana

Abstract

Corporate social responsibility (CSR) has never focused on the implementation of cash trans-

fers to vulnerable groups. The present paper intends to explore this particular option, which

can be described through an analysis of 3 different phases: the production of income, the distri-

bution of income, the choice of the vulnerable groups to be benefitted. Every phase involves

new and specific features, which are linked to a new approach in the field of corporate social

responsibility. An evaluation of advantages and disadvantages of this particular approach will

be carried out, in each of the 3 single phases, in order to be able to evaluate the consequences of

this new approach. The approach seems to be particularly promising since it can be applied to

very different categories of vulnerable groups. Still, the approach is best suited if the underly-

ing vulnerability is poverty, since the transfer of financial resources allows to fight poverty by

definition.

Keywords: Corporate social responsibility, poverty, unconditional cash transfers, vulnerabil-

ity, homeless.

Introduction

This paper intends to identify and discuss a new model of corporate social

responsibility, which can contribute to the reduction of the growing disparities in

income distribution which can be found in almost any society today. The level of

inequality is in fact rising both inside and across countries, according to data and

information provided by qualified sources1. According to mainstream economic theory,

inequality can represent a hindrance to economic growth, besides being a problem

for social cohesion.

This new type of corporate social responsibility can be considered the feature that

gives birth to a new kind of enterprise, which I named “redistributive enterprise”. Its

peculiar characteristic is that the enterprise transfers part of its profits directly to

vulnerable groups. If the redistributive enterprise sell its goods and services to richer

people, that is to say if the enterprise does not sell its products and services to

vulnerable groups themselves, it will play a redistributive role in the society, by

allocating financial resources from one group of the society to another, from richer

people to vulnerable groups.

In a first instance, three aspects can be analyzed for the redistributive enterprise: the

production of income, the effective way to transfer profits, the selection of vulnerable

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1 For a good analysis of the evolution of income inequality in the last centuries, an excellent reference is “Capital

in the 21st Century” by Thomas Piketty.