Social exclusion is a process as well as a state that can affect individuals, families and whole communities, leading to an inability or difficulty in engaging in society and its institutions. It is context dependent, multifaceted and consists of mutually reinforcing factors which affect people differently, going beyond just economic factors to include concerns such as self esteem, social networks, and access to resources. Therefore fostering social inclusion requires nuanced, sensitive and context specific responses.
Potential risk factors of exclusion include:
● Long-term health problems, or disability
● Mental health conditions
● Criminal record
● Substance misuse
● Educational status and skill level
● Homelessness, poor or unstable living conditions
● Caring responsibilities
● Lack of access to public and private services
● Chronic or long term unemployment
● Culture, ethnicity, traditions, religious belief
● Sexual orientation
● Indigenous communities
● Refugee and/or migrant status
● Social class
● Geographic region, e.g. rural or economically deprived
Social exclusion has a negative impact on individuals and society, as well as business. However, businesses can play an important role in mitigating social exclusion, and benefit from its reduction in many ways. For example:
● Access to more talent in the employment pool
● Identifying potential markets and customers
● Raising the profile and reputation of the company
● Building a more thriving community in which to conduct business
● Building employee and customer loyalty (amongst affected groups and more widely)
● Improved productivity through increased skills and motivation.
This can be achieved by both removing the barriers to social inclusion and focusing on prevention.
Business has a large impact through providing employment, which not only provides an income but can also improve social inclusion through conferring social identity, improving confidence, increasing skills and developing social ties and networks. Unemployment is viewed as one of the primary contributing factors to social exclusion, reinforcing other factors such as low quality housing, fuel poverty, and poor health.
Recruitment practices can remove some barriers, for through example specifically targeting excluded groups, such as ex-offenders or the homeless, especially those who maybe more difficult to reach, or are who face multiple exclusion factors. For example, Timpsons have are running programs with prisons to train inmates during their sentence and provide experience of working in their shops during day release. This has provided jobs and reduced reoffending rates. Additionally, recruitment criteria may be artificially excluding potential employees. For example, those from lower economic background/deprived or excluded background are less likely to get to top tier universities, or attend higher education at all, so recruitment efforts focused solely on these institutions for recruitment will exclude entire groups and reinforce exclusion. By providing training to new hires, businesses can remove some of the barriers to entering the workforce.
However, employment alone may not be the answer for every individual. In the UK, of those in poverty, 55% are in working families. It is important therefore for jobs to offer quality employment, continual skills development and working conditions that promote social exclusion and target working poverty. This can range from paying the living wage to providing childcare facilities to providing training opportunities across the organisation. Additionally, insecure or informal work, which is more prevalent in more frequently vulnerable groups such as women, young people and ethnic minorities, is less likely to reduce social exclusion, and, since it is more difficult to transfer to formal or permanent work, can deepen it.
Where a business locates its activities can also have a huge impact on individuals and communities, both positively and negatively. For instance, when moving into a new area, a business could hire trained staff from other businesses in the area, or could train low-skilled individuals, thereby boosting the local skilled talent pool. Similarly, when closing plants of branches, individuals can be supported to find new jobs in the area or to re-skill.
New construction or operations of any kind can have significant impacts on a community, such as large scale developments such as mining and commercial farming. This can be particularly acute in countries where there are issues around governance, regulation and human or minority rights or where there is ambiguity about customary property rights. Consulting local communities and leaders can help in reaching solutions that support those excluded and prevent further exclusion as a result of these projects.
A business can use its position to influence others in several ways. Harmful business practices include cancelling orders after production, undercutting local independent competitors, or negotiating with local councils to reduce the amount of social housing in new developments. On the other hand, businesses can commit to paying suppliers a fair price and compensating them for cancelled orders, or consider social exclusion in investment or procurement decisions. So by focusing on how they do business with other organisations, a business can influence whether it has a positive or negative impact on exclusion.
Charitable or philanthropic activities can also support social inclusion and can take many forms. A business can support local charities, organisations and communities through:
● Donating time, resources, expertise or money
● Work experience opportunities for school children or potentially excluded groups, e.g. recent migrants
● Training or educational opportunities, such as digital literacy workshops, scholarships for higher education
● Financial resources, such as grants for local businesses and start-ups
● Sponsoring sports teams, day trips for clubs etc.
More broadly, the products and services businesses provide can have a wider impact. For example, accessibility can be built in to products. Developers can build houses that can be adapted to changing needs, such as age or disability, and transport providers ensuring rural areas or adequately served to allow residents to access services easily. Alternatively, a business can perpetuate deprivation and exclusion. For example, companies like rent-to-own specialist BrightHouse has come under fire for selling household goods to socially excluded customers which have ended up costing three times more than a regular purchase once interest is factored in. These repayment arrangements predominantly target low income customers who do not have the option to shop around for a better deal. Companies in these markets frequently respond to accusations that they exploit vulnerable people by claiming that they are serving market segments which other businesses ignore.
In developed countries making sure goods and services are accessible to lower income groups can also be an issue. In the UK and USA the issue of “food deserts” highlights that supermarkets often avoided low income areas making it harder for local people to access affordable, healthy food. This is an example of the “poverty premium”, where people in poverty pay more for equivalent goods and services than those with higher incomes. For example those on low incomes often lack access to ‘enabling goods’, such as access to the internet which enables them to shop around and find the lowest price. Similarly, they simply end up paying more because they lack the money to buy products outright and instead rely on hire purchase type consumption with monthly repayment plans which, in the long term, make purchases many times more expensive than the recommended retail price.
With technological advances comes the opportunity for digital technology to reduce inequalities and tackle exclusion. However, digitisation is not an automatic solution, and could increase inequalities if not implemented with consideration to customer needs. If a service is only provided online, those who are not digitally literate will not be able to access this service. This can be addressed through increasing digital literacy, or ensuring services can be accessed in more than one way.
It is up to each business, depending on its particular operations and resources, to identify the best way of promoting social inclusion.