“Do you think that earning a high salary means that one is necessarily well off?”, one grassroots leader asked us as we carried out fieldwork for our poverty in Brunei study. In Costa Rica, Horizonte Positivo, a welfare agency, posed a similar question: “Does having a job and an income ensure that they [employed people] have a good quality of life?”In my home country, Zimbabwe, one is considered relatively well-off if one’s salary is above the country’s poverty datum line. For this reason, workers tend to ask for a salary that is above the poverty line, as seen here, for example, and employers aim to constantly offer that salary. The question that must be asked, however, is: does this salary necessarily guarantee one a better life? I reflected on this as I was reading about the Business Multidimensional Poverty Index (BMPI), and was left pondering why the corporate world should consider adopting the BMPI.

BMPI is a tool for measuring corporate poverty developed by SOPHIA Oxford, Oxford University. It is used to measure, analyse, and respond to challenges relating to the well-being or poverty conditions of employees and their families. The BMPI tool identifies employees living in multidimensional poverty as well as the specific forms of poverty that each employee and his or her family experience. In the process, the tool provides insights into measures that a company could take to address the deprivations of its employees and their families. You can find more about the BMPI here. 

The BMPI is considered to be an innovative way of fighting poverty in the corporate world. I could not agree more. However, this tool is yet to be widely adopted. Only some employer organisations in Costa Rica and some countries in Latin America and the Caribbean have embraced the tool. In this blog post, therefore, I share three reasons why employers across the world should consider adopting the BMPI tool.

The tool generates or improves employee loyalty

Employee loyalty is key to the success of any organisation. It improves productivity and the corporate image, increases customer or client loyalty and reduces staff turnover, among other benefits, as  Indeed, a worldwide employment website, explains. It has been disturbing to note that employee loyalty has been on the decline since the early 1990s and this has been worsened by the Covid-19 pandemic, which exposed employees to additional life challenges (World Economic Forum, 2021).  This reveals that many employees are actively seeking alternative employment opportunities, a fact which has the potential to adversely impact the success of most organisations.

For this reason, organisations  “are scratching to find ways to increase loyalty amongst their employees.” It goes without saying that the employees tend to be more loyal to organisations that are concerned with improving their well-being, and this ultimately translates into the success of the organisations. Improving the well-being of employees and their families is therefore something that organisations could and should seriously consider.

The BMPI tool becomes useful in this regard since it enables organisations to gain a comprehensive understanding of the well-being needs or challenges of every employee and his or her family and to determine appropriate ways to help them improve their well-being. The tool has been lauded by the former Sustainability Manager for BAC Credomatic Bank in Costa Rica, which is one of the companies that pioneered the use of the BMPI. As the Manager affirms, the use of the BMPI tool results in the adoption of well-being measures that decrease staff turnover and improve the work environment.

The BMPI tool presents a true and holistic picture of corporate poverty

Corporate poverty is typically defined based on a country’s income poverty line. Employed individuals are considered to be poor if their salaries are below their countries’ poverty lines, as defined here and here. This way of defining poverty could be misleading, as I have argued here. It does not sufficiently shed light on the nature and extent of poverty of employed people with an income below the poverty line considering that poverty, as we have argued here, is multidimensional and complex. Furthermore, and in addressing the questions raised in the introduction, not everyone who earns above the poverty line is necessarily better off. I have observed this in poverty studies I have carried out in Zimbabwe and Southeast Asian countries. One can earn an above-the-poverty-line salary but still be financially poor. This is typical for employees with many dependents, excessive debts, and who earn, as is the case with some employed people in Zimbabwe, in local currency but pay for rentals, fuel and medical services in foreign currency (USD), which they usually secure from the black market. In addition, some employed people may well earn above the poverty line, but because of the nature of their contracts, (e.g. employees on casual or temporary contracts) do not have access to loans from financial institutions, which is a form of financial deprivation.  Furthermore, poverty is more than merely a lack of income. An employed person can be financially well off but experience other forms of poverty. Not having enough time with one’s children aged 0 to 5 years old, for example, is a form of poverty in Sri Lanka, and it is common among parents who spend much of their time at work.

The BMPI tool addresses the flaws of the current conceptualisation of corporate poverty, highlighted above, in two ways.  Firstly, the tool acknowledges the multidimensionality of poverty. Costa Rica’s BMPI, for example, covers five dimensions ( education, health, living place, job and social protection) and twenty corresponding deprivation indicators. The BMPI therefore measures corporate poverty beyond the salary (income level), and therefore truly reflects the nature and extent of poverty among employees who earn below and above a country’s poverty line. Secondly, unlike the current corporate poverty conceptualisation approach, the tool focuses on both employees and their families. It is therefore able to capture what truly happens in the life of an employee and in his or her family. Accordingly, in Costa Rica, the BMPI tool revealed more employee household poverty than anticipated among employees for pilot companies, such as Credomatic Bank, Purdy Motors and Costa Rica’s Toyota Dealer.

The BMPI tool facilitates effective Public-Private Partnership in poverty eradication

Public-Private Partnership (PPP) has enormous potential to help in the eradication of poverty. The BMPI promotes effective PPP in the eradication of poverty in two ways. Firstly, it ensures that no poor persons in the corporate world are left behind in poverty eradication efforts.  At the heart of the Sustainable Development Goal 1 is the ‘leave no one behind’ principle, which calls for poverty eradication efforts to reach poor people in all segments of society, including the corporate world, as explained here and here. Poor people in the corporate world, however, are at risk of being left behind due to the way corporate poverty is currently defined, as has been described above. The BMPI therefore provides sufficient insight into the different forms of poverty experienced by every employee and his or her family. Secondly, the tool leads to the design and implementation of employee poverty eradication programmes that effectively complement government poverty eradication efforts. In Costa Rica, for example, the BMPI resulted in poverty programmes that targeted employees and their families, which contributed significantly to improving the educational level of the country’s adult population, reducing forms of deprivation linked to the labour dimension of the National Multidimensional Poverty Index, and alleviating housing poverty within the country. You can read more about this here.

Should all employers across the world consider adopting the BMPI, then?  Yes! Absolutely! In addition to the reasons shared above, the tool enables us to see how much corporate poverty across the world there is.