From Poverty to Power Green, Oxfam 2008 - weman

3 POVERTY AND WEALTH PRIVATE SECTOR, PUBLIC INTERESTSouthern Brazil’s shoe industry or Bangalore’s software cluster. Fortheir part, SMEs need to strengthen their industry associations, so thattheir voice is not drowned out by the well-organised lobbyists of largedomestic companies and TNCs, whose interests are not alwayscompatible with those of small companies. SMEs have also beenwrongly left out of the debates on corporate social responsibility. Justas with large firms, there are both good and bad SMEs, and pressure isneeded to push firms towards responsible social and environmentalpractices.LARGE FIRMSLarge companies, whether under national or foreign ownership, alsoplay a crucial role in economic development and in the lives of poorpeople. Although they tend to be more capital-intensive than SMEs,and so create relatively fewer jobs, they have a wider role in that theycontrol complex production and distribution chains, and introducetechnology that is then picked up by smaller firms.Oxfam’s analysis of Unilever’s ‘poverty footprint’ in Indonesiashowed that, overall, the firm’s operations generate about 300,000full-time equivalent (FTE) jobs. Strikingly, more than half of thesejobs are in Unilever’s ‘downstream’ distribution and retail chain, withonly about one-third ‘upstream’ in the part that makes inputs for thecompany’s products. The value added within the value chain is evenmore dispersed than the benefits of employment within the chain,with Unilever itself accounting for only $212m of the estimated totalof $633m in added value from its operations. 141Large firms are typically better connected with decision-makers,and use that influence to ensure that state policies serve their interestsby giving them tax breaks and other incentives, guaranteeing themhigh profits, minimising competition, or ensuring privileged access tostate spending.In recent years, global companies have entered low-incomeconsumer markets, epitomised by banks selling microfinance servicesor companies selling shampoo and other goods in individual sachetsrather than by the bottle. Deploying vast advertising and salescampaigns to promote their brands, such TNCs have displaced large171