Building Assets to Reduce Poverty and Injustice

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Building Assets to Reduce Poverty and Injustice
Ford Foundations experience in implementing an
asset building framework in its global program

• Melvin Oliver, Vice-president
• Pablo Farias, Deputy to the Vice-president
• Asset Building and Community Development Program
• The Ford Foundation
• Reducing Poverty Through Asset Based Development
• USAID Training Workshop, Washington, D.C.
• January 2004

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Ford Foundation Programs
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Central propositions

• Durable improvements in the lives of poor people
  and communities are most likely to occur if the
  poor acquire and gain access to assets, restore
  or protect their assets, and control, deploy, or
  enhance the condition of their assets.
• The assets approach builds on the innate ability
  of all human beings to develop their skills and
  on the near universal desire to create a better
  life for ones progeny.

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A ChallengeUnequal Distribution of Assets

• Longstanding social structures, cultural
  traditions, and public policies facilitate or
  impede ownership of, access to, and investment in
  assets
• Lack of assets is the basis of recurrent and
  trans-generational poverty
• Women and ethnic minorities have often been
  excluded from developing assets

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Assets Framework a paradigm shift for poverty
reduction

• From traditional focus on income/consumption
  support to access to/development of resources
  wealth creation
• Spotlights inadequacy of short-term, income-only
  approach in helping people to get out of poverty
• Raises bar for poverty reduction efforts.
  Desired outcome is building assets that allow
  people to be independent.
• Puts poor and rich on same metric, focusing
  attention on policy and social changes needed to
  achieve equity.
• Shifts focus to concrete outcomes that move
  people beyond poverty and towards social and
  economic security

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Power and Assets

• An assets framework reveals ways political,
  economic social power are used to create and
  maintain inequitable outcomes based on race,
  gender, and class
• Subsidies for asset building for affluent and
  middle class, but not the poor
• Allocations of natural resources and pollution
  that enrich and protect the affluent, and poison
  and impoverish the poor
• Policies and practices that develop communities
  physical assets inequitably
• The term asset implies not only the existence of
  wealth, but also a set of rules and institutions
  that govern access to this wealth and the
  distribution of the benefits derived from it.
  (James Boyce)

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Targeting 4 Classes of Assets

• Social
• Social capital and civic
• culture of a place
• Philanthropic capital
• assembled for/from a place
• Human
• Marketable skills
• Comprehensive sexual
• reproductive health

• Financial
• Savings
• Homeownership
• Equity in a business
• Natural Resources
• Forests, wildlife, land,
• livestock
• Environmental services
• (e.g., forests, cleansing, recycling, renewing
• air water)

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Different Contexts

• North and South Americas, Asia, Africa, Russia
• Developed and developing nations
• Formal and informal economies
• Strong or weak civic infrastructures
• Democratic and authoritarian states
• Places with chronic violence
• Governments in prolonged fiscal crisis
• Poverty in rural and urban places

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Ford Foundations Fields of Work

• This field primarily builds
  this asset
• Development Finance Financial Assets
• Economic Security
• helps low-income people generate sustainable
  incomes, save and plan for the future, and
  protect against unforeseen economic setbacks
• Environment Development Natural Assets
• supports community development strategies that
  convert natural resources and environmental
  services into assets that benefit low-income
  people
• Workforce Development Marketable Skills
• of Individuals
• supports mechanisms that enable poor and
  disadvantaged people to obtain marketable skills
  and access to resources necessary to get and keep
  good jobs.
• Community Development Social Assets
• fosters healthy, equitable communities with
  strong civic culture where low-income people have
  opportunities to build a spectrum of individual
  and collective assets.

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Financial Assets

• Field Innovations
• New focus on supporting savings and broader set
  of financial services for the poor
• Shift from investing in rental housing for poor
  to home ownership by poor
• Building on microfinance legacy
• Program Focus
• Savings by low income households in the United
  States
• Strengthening Development Finance Institutions
  (DFIs) in Chile, China, India, Kenya, Mexico,
  Nigeria, US
• Home Equity in the US Self Help-Fannie Mae
• Individual Development Accounts in US 15,000
  low-income people have saved millions more than
  14 million saved/used for asset purchases 75
  of savers are female 86 are poor
• Homeownership Supported 27,000 low-income
  households in US purchasing homes through special
  program established by Self Help Ventures Fund
  and Fannie Mae
• Insurance for the Poor More than 70,000 poor
  women and 22,000 of their husbands in
  northwestern India have purchased affordable
  insurance, provided by the Self Employed Womens
  Association (SEWA), covering loss of life and
  assets, accidents, death of a spouse, and health
  and maternity costs

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Natural Assets

• Innovations
• New focus on land rights and building of
  organizational resources and management
  capacities in poor communities
• Increased emphasis on market mechanisms that
  contribute to sustainable development of natural
  assets Payment for Environmental Services (PES)
  and third-party environmental certification
• Building on Foundations community forestry
  legacy
• Program Focus
• Community Forestry in Brazil, China, India,
  Indonesia, Mexico, Guatemala and the US
• Resource certification globally
• Payment for Environmental Services in Mexico,
  Central America, South Africa and China
• Joint Forest Management in India 2.8 million
  families engaged in protecting and managing 14
  million hectares of forestlands
• Fair Trade Coffee 10,000 stores in US and 35,000
  in Europe sell Certified Fair Trade coffee,
  which ensures fair prices for small-scale growers
  in developing countries
• Sustainable Forests More than 10 percent of
  worlds 1 billion acres of working forestlands in
  more than 40 nations are certified for
  sustainable forest management (Forest Stewardship
  Council)

Restoring community rights over natural resources
in South Africa
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Social Assets

• Field Innovations
• Initiate focus on community equity within
  emerging metropolitan regional contexts to ensure
  healthy environments and access to resources
• Initiating place-focused asset building in
  Camden, NJ
• Building on Foundations community philanthropy
  legacy
• Program Focus
• Community Philanthropy in US, Africa, US/Mexico
  border
• Metropolitan Regions Equity/Racial Justice in the
  US
• Community Philanthropy More than 42 million in
  new community-based philanthropic endowments
  dedicated for rural areas in US. More than 100
  community foundations in US, Africa, and along
  the Mexico-U.S. border are engaged in rural
  philanthropy learning networks

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Human Assets

• Field Innovations
• Focus on marketable skills and employee benefits,
  rather than jobs, as outcome for workforce
  development
• Creation of sustainable-wage jobs for
  disadvantaged groups
• Focus on access to services and support systems
  for working poor families
• Program Focus
• Sectoral Employment in US
• Investing In Working Families in US
• Cooperative Home Care Associates (CHCA), a
  worker-owned cooperative and employer-based
  training program that provides home health aide
  services, has built an enterprise model that
  demonstrates how the home care job can be
  improved, and has diffused those practices by
  becoming a yardstick corporation for the
  industry, promoting the formation of a network of
  affiliated businesses and training programs that
  extends its sectoral approach by addressing state
  and national policy and regulatory issues that
  affect working conditions in the long-term care
  industry.

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Pathways to Scale

• Influencing fields of practice
• building learning networks among individuals and
  organizations that can develop, adopt, and
  rapidly spread new tools and practices.
• Tapping market forces
• pressing or helping businesses to change their
  operational practices, such as hiring and
  procurement, in ways that benefit low-income
  people, or establishing alternative commercial
  enterprises to serve the poor.
• Developing public policies
• persuading government bodies to revise, adopt,
  and implement laws, regulations, investments, or
  services.
• Changing power relations
• mobilizing low-income people and communities to
  secure representation and voice in public,
  private, civic, and cultural decision-making
  processes that affect their lives.
• Social learning
• using educational processes to provide large
  numbers of individuals with information that
  influences their personal behaviors.

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Pathways to Scale