In the realm of economic development, the private sector can contribute to poverty reduction by providing employment and through initiatives to improve the well-being of workers and their families. 

Understanding the living conditions and hardships facing employees and their families is key for making strategic decisions that contribute to closing gaps while positively impacting companies' productivity and competitiveness.

A case in point is Danper, a leading Peruvian company in the global agri-food sector. 

It is the first company in the country—and one of the few in the world—to measure the multidimensional poverty of its staff and their households to strengthen the impact of its management model based on creating Shared Value.

In this way, the company links the economic efficiency of its investments with the progress of its workers, communities, and value chain.

Multidimensional Poverty 

Multidimensional poverty goes beyond the traditional measurement of poverty by income. 

It encompasses various deprivations that people face in their daily lives, including a lack of access to education, healthcare, housing, and essential services. 

The global Multidimensional Poverty Index (MPI), developed by the Oxford Poverty and Human Development Initiative, provides a comprehensive framework for measuring these deprivations. 

With the support of IDB Invest, Danper adapted the MPI to the local reality to measure the multidimensional poverty of its workers and their households. 

Danper's index has four dimensions: education, health, services, and socioeconomic participation. 

For each dimension, the index established indicators such as educational attainment, access to health insurance, housing material, and employment status of household members. 

With this information, Danper seeks to gain a deeper understanding of the daily deprivations faced by its workers and their families, beyond the lack of income, to make informed decisions on where to focus its actions.

Based on a sample of 711 employees, the study revealed that approximately 28% of their households experience multidimensional poverty, meaning they suffer from one-third or more of the deprivations defined in Danper's MPI.

However, multidimensional poverty among Danper workers is almost nine percentage points lower than the 36.8% estimated by one of the few MPI studies in Peru, where there is no official measurement of multidimensional poverty. 

Employment and Health 

The most reported deprivation was "precarious employment." 

For example, 48% of worker households have at least one member without a job contract or with an informal business.

Secondly, 46% of workers have at least one family member without health insurance. 

This highlights both the importance of formal employment generated by Danper and the healthcare provided to its workers and their families.

Gender, Age, and Education 

The study revealed that multidimensional poverty affects the households of female workers (32%) more than their male counterparts (22%). 

Similarly, workers aged 37 to 66 have higher rates of multidimensional poverty (35%) than those aged 18 to 36 (21%).

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The study also analyzes the main determinants of poverty. For example, having a higher educational level decreases the likelihood of being in multidimensional poverty. 

This finding again highlights the value of Danper's social programs, such as the Alternative Basic Education Center, in partnership with the Peruvian state, which offers workers primary and secondary education at the company's facilities.

Private Sector

This experience highlights the possibility of adapting a standardized measurement usually applied in public policies, such as the MPI, to the private sector context. 

Through these efforts, the company hopes to establish a baseline of MPI information for its workers and their families, allowing it to embark on a deeper impact management trajectory.

With this achievement, Danper positions itself as a relevant reference point in Peru and Latin America. We hope it generates interest and incentives for other companies to follow the same steps.

For more information: Multidimensional Poverty in the Agricultural Industry: Towards a Private Sector that Generates Inclusive Economic Development. The Case of Danper in Peru (only in Spanish).