ACCOUNTANCY AND BUSINESS MANAGEMENT:

A SITUATION ANALYSIS ON POVERTY IN THE PHILIPPINES

A Partial Requiirement in
Business Ethics and
Social Responsibility

Sunny Hillside School of Bataan Incorporated

By
Group 2
Lopez, Mhicaella Maureen
Maquidato, Mhikyla
Caña, Lianne Claire
Ricardo, Rycel
 S.Y 2023-2024
I. Social Issue

Ever since money was introduced centuries ago, it had controlled our lives
ceaselessly. Because of this, people are blessed to have enough money to sustain themselves
and their families however, there are also people who are not. Poverty is the state or
condition in which a person or community lacks the financial resources and essentials for a
minimum standard of living (Chen,2023). It is often due to the high prices of food, and
disasters that have exacerbated poverty in the Philippines as well as corruption. The poverty
incidence among families, as reported by the Philippine Statistics Authority(PSA), declined
to 16.4 percent in the first semester of 2023 from 18.0 percent in the same period of 2021,
equivalent to 230,000 households escaping poverty. In terms of population, poverty incidence
decreased from 23.7 percent to 22.4 percent, or 895,260 less poor Filipinos. Across the
country, poverty incidence decreased in 15 out of the 17 regions from 2021 to 2023,
declining significantly in NCR, CAR, Cagayan Valley, Central Luzon, SOCCSKSARGEN,
and Caraga. Thus, suggests potential advancement in addressing the root causes.

In addition, among the provinces of Central Luzon as of 2015, Bataan province has
the lowest poverty rate of 2.0 as stated by the PSA. However, certain areas in Bataan
continue to suffer from substantial poverty rates. Brgy. St. Francis II in Limay registered the
most number of identified poor households with 427. Brgy. Kapunitan in Orion, which
placed 2nd among the poorest barangays in the province, was the third most populous
barangay in the municipality of Orion in year 2015. On the other hand, the largest share of
the poorest barangays comes from the municipalities of Morong and Mariveles with five
barangays each.

Furthermore, in the municipality of Mariveles, there are reportedly 4.90% poverty

incidents as PSA releases the 2018 Municipal and City Level Poverty Estimates and with the
total of 39410 households in population. Although, there are job opportunities within the
locality and numerous of companies that can help people to earn and make a living. In some
areas, there are people who sustain their living through fishing with limited access and tools.
It is also may be concerned with lack of education that limits their capability to work in some
companies and earn money.

Poverty in the Philippines dated back to the Spanish colonial era, where social and
economic progress was centered in strategic cities like Manila. During the Spanish
colonization, economic exploitation and land concentration contributed to widespread
poverty among the indigenous population. The American period brought changes in
governance but also economic disparities. Furthermore, Philippines faced economic
challenges after the World War II, with reconstruction efforts and issues like land
distribution. Political instability and authoritarian rule in the latter half of the 20 th century
further influenced economic policies and development. The country experienced periods of
economic growth, but wealth distribution remained uneven, contributing to persistent
poverty. In addition, according to Philip Gerson, it is due to the past economic policies that
hindered growth, and the resistance of powerful elites to much-needed reforms, were largely
responsible for the high incidence and persistence of poverty in the Philippines.

The significance of business ethics play a crucial role in addressing poverty by

promoting fair practices, responsible decision-making, and sustainable development. Ethical
business behavior can contribute to economic growth, job creation, and community well-
being, ultimately helping to alleviate poverty. Ethical considerations influence policies,
resource distribution, and social structures, helping to ensure that efforts to alleviate poverty
are just and inclusive. By applying Corporate Social Responsibility(CSR), businesses can
help address poverty by engaging in socially responsible practices which include fair labor
practices, supporting local communities, and investing in education and healthcare. By
promoting ethical business behavior, CSR contributes to sustainable development, creating
positive impacts on both society and the economy, which can ultimately help alleviate
poverty. By prioritizing ethical principles, societies can work towards creating sustainable
solutions that uphold human dignity and reduce disparities.
 II. Social Impacts

Poverty is a state or situation in which a person or a group of people don’t have

enough money or the basic things they need to live such as food, clothing, and shelter.
However, poverty is more, much more than just not having enough money (Brunswick,
2009). According to an article of United Nations, poverty entails more than the lack of
income and productive resources to ensure sustainable livelihoods. Its manifestations include
hunger and malnutrition, lack of access to education and other basic services. Below are the
social impacts of poverty:

1.Famine

One of the many impacts of poverty is famine. It happens when people do not have
enough food to eat. The main cause of famine is not a collective shortage of food but rather
access to food – especially nutritious food. In recent years, due to inflation, the prices of foods
has risen and it would continue to do so. High agricultural costs, rising food prices, and an over-
reliance on imports are pushing farmers toward poverty thus leaving people hungry in the
Philippines.

Another example of famine due to poverty are the people who resort to eating pagpag.
The act of eating pagpag arose from the challenges of hunger that resulted from extreme poverty
in the Philippines. It is the leftover of meat and bones from restaurants, scavenged from garbage
sites or dumps. Just to fill their stomachs and earn money from these recycled foods. However, it
is obvious that it is unhealthy.

2.The impoverished society

The picture above is a photo of a homeless family. It is a reality that poverty

impacts people in many possible ways. One of which is the lack of proper house. Some
people who suffer from extreme poverty sleep on roadsides or wander around the street
begging for money in order to survive. The Philippines has the largest homeless population in
South East Asia towering at around 4.5 million according to the National Statistics Office
which is already a cause of great alarm.

Homelessness in the Philippines is caused by a variety of reasons, including lost

jobs, insufficient income or lack of a stable job, domestic violence and loss of home due to
natural disasters. Although the unemployment rate in the Philippines is low (5.08% in 2024),
16.4% of Filipinos’ wages remained below the country’s poverty line in 2023. Low income
can make it difficult for many families in the Philippines, especially those living in
apartments, to pay rent.
3. Lack of education

Poverty not only affects adults but also children. The effects of poverty on children are
wide-reaching and can lead to lifelong struggles, especially when young people don’t receive full
educations. A large number of children in poverty faces many obstacles about quality education.
These barriers include subpar school rooms, lack of school supplies, and transportation issues.
Other students are also unable to go to school because they do not have “baon” whether it is
money or food, some think that their fares and fees at school are quite expensive or they just do
not have their uniforms. Thus, many of them cannot enroll in schools which could help them
achieve a better future. In addition to that, many children from disadvantaged backgrounds are
forced to abandon their education due to health problems related to malnutrition or in order to
work and provide support for the family.

4. Child Labour

Families living in poverty often have no choice but to rely on their children’s labour to
make ends meet. Especially if the parents are low wage earners as they struggle to provide basic
necessities, such as food, shelter, and clothing while some parents see child labour as a means of
economic survival. Moreover, some children work in farms and plantations, in dangerous mines,
on streets, in factories, and in private homes as child domestic workers. This situation is
exacerbated if one or both parents is absent, has fallen ill or has passed away.

According to the Special Release on Working Children Situation for 2019 to 2021
published by the Philippine Statistics Authority (PSA) posted on March 3 2023, there were 1.37
million(4.3 %) working children, 935,000 of whom were engaged in child labor. It also identified
the agriculture sector as the top industry with the most child laborers and tagged Northern
Mindanao as the region with the highest child labor incidence.

In 2022 however, according to PSA, the number of working children in the Philippines
continues to rise, with an estimated 1.48 million children aged 5 to 17 working. According to the
data, among 31.71 million children aged 5 to 17 in the country, 4.7 percent were working
children, compared with 4.3 percent in 2021, or 1.37 million working children. Among them,
49.5 percent worked in the service sector, while 43.2 percent in the agriculture sector, 7.3 percent
in the industry sector, the data showed. The number of working children considered engaged in
child labor, including those doing hazardous work or working more than 40 hours per week, was
estimated at 828,000 in 2022, decreasing from 935,000 in 2021.

5. Limited Access to Health Care

Despite significant health gains around the world, many people are still just one illness
away from poverty. While people are living longer than ever, the number of people living with
one or more diseases that require complex care over many years is on the rise (Weiler, 2018). 60
million Filipinos experience healthcare poverty. Millions live a considerable distance from the
nearest clinic, lack sufficient health literacy, and cannot afford the cost of healthcare. According
to World Health Organization, the poorest Filipinos spend around 60 percent of their family’s
income on food. With over half of health care costs paid out-of-pocket, they simply cannot afford
to fall ill: money that is meant for food will be diverted to health.

Moreover ,based on the 2013 National Demographic and Health Survey Report, the two
major obstacles preventing households from visiting healthcare facilities are (i) a lack of
financial resources and (ii) the geographic remoteness of facilities, especially in poor regions. An
example of these are the Indigents or persons who have no visible source of income, or whose
income is insufficient for the subsistence of the household, as identified by the Department of
Social Welfare and Development.
 III. Solution

1.Famine

According to Philippine Business for Social Progress (PBSP) with their project, The
Hunger Project (THP) aims to address the underlying problem of hunger and malnutrition by
supporting programs, projects, and organizations responding to the urgent need to help the
hungry, while seeking to introduce frameworks and approaches that address systemic and
persistent hunger and malnutrition plaguing the Philippines. Not only this but the government is
also addressing this issue resulting to hunger rate decreasing. An example of this is the National
Feeding Program for children as well as Action Against Hunger that works to eliminate hunger in
the Philippines. However, focusing on improving agricultural practices, investing in
infrastructures, promoting sustainable farming, and ensuring fair distribution of resources could
also be a solution. Additionally, addressing underlying issues like poverty, and political
instability is important for long-term solutions.

2. The impoverished society

Collaboration between government, nonprofit organizations, and communities is

important to create comprehensive solutions. One of the approach could be providing affordable
housing. Increasing the availability of affordable housing options through subsidies, low-income
housing initiatives, and partnerships with private developers. This can help individuals and
families transition out of homelessness. Secondly, offering vocational training programs and
employment assistance to help individuals acquire the skills needed for sustainable employment.
This empowers the people to regain financial stability. Thirdly, providing legal assistance to
individuals facing housing-related issues, preventing unfair evictions and ensuring access to
housing rights. Lastly, expanding and improving emergency shelter services could be of help for
the people who are a victim of natural disasters.

3. Lack of access to Education

Lack of education could be addressed by continuing to prioritize education reforms,

investing in the education system, and ensuring equal access to education, the Philippines can
work towards addressing the lack of education in the country. In addition, the government and
organizations must invest in building schools in underserved areas, providing scholarships and
financial aid to disadvantaged students. Also, schools providing free meals and uniforms so that
poor families do not have to go without necessary things in order to send their children to school.

4. Child Labour

Creating a law that makes it illegal for children to work until they reach a certain age so
that it is easy to counter. Secondly, reducing poverty as this is the key reason for the existence of
child labour especially when both parents’ wage are not enough to support the family. Thirdly,
ethical consumerism because by spending their money wisely or inadvisedly, consumers can help
to halt or can (often inadvertently) support child labor. By investigating the companies that you
buy from and refusing to hand over your cash to companies that deploy child labor, you can stop
funding sweatshops and other unethical businesses that are taking away the childhoods of young
people.

5. Limited access to healthcare

Addressing limited access to healthcare requires a multifaceted approach. Implementing

affordable healthcare programs, expanding insurance coverage, and investing in community
clinics can help bridge the gap. Additionally, promoting education on preventive healthcare and
addressing social determinants of health, such as housing and nutrition, can contribute to a more
comprehensive solution. Furthermore, free check ups sponsored by NGOs and the government
could also help. Lastly, providing enhanced access to better healthcare services by building
medical clinics and hospitals.

Summary

Addressing the social impacts of the social issue require a multifaceted approach. Firstly
addressing famine by; focusing on improving agricultural practices, investing in infrastructures,
promoting sustainable farming, and ensuring fair distribution of resources. Secondly, solving the
problems regarding the impoverished society by providing affordable housing, job training and
opportunities, providing legal assistance for the victims of unfair evictions, as well as expanding
emergency shelters for the victims of natural disasters. Thirdly, to address the education
challenges in the Philippines, focusing on reforms, investing in schools, provide scholarships,
and offering free meals/uniforms for disadvantaged students, to ease the burden on poor families.
Then, to combat child labor includes enacting age-restriction laws, and promoting ethical
consumerism to prevent investing businesses get involve in child labor or unethical practices.
Lastly, to address limited healthcare access: implement affordable programs, expand insurance
coverage, invest in community clinics, promote preventive healthcare education, tackle social
determinants, sponsor free check-ups, and enhance access through building medical facilities. In
summary, the social impacts of poverty require the cooperation of the Philippine Government,
businesses, and the community.

Conclusion

In conclusion, the relationship between poverty and its social impacts in the Philippines
reflects a complex narrative shaped by historical, economic, and political factors. While strides
have been made, as seen by the decline in poverty incidence, challenges persist in specific
regions and vulnerable communities.

The social impacts of poverty, including famine, homelessness, lack of education, child
labor, and limited access to healthcare, underscore the urgent need for comprehensive solutions.
Initiatives such as affordable housing programs, educational reforms, and legal interventions
show promise in addressing these multifaceted issues.

Furthermore, the historical roots of poverty dating back to colonial eras and economic
policies, emphasizes the importance of systemic reforms. The role of business ethics and
Corporate Social Responsibility (CSR) is significant in promoting fair practices and sustainable
development, contributing to poverty alleviation.

Finally, the analysis emphasizes the need for sustained efforts from various sectors,
including government, nonprofits and for profit businesses, and communities, to address the
complex challenges caused by poverty. The proposed solutions, if implemented effectively, can
contribute to creating positive change and improving the overall well-being of individuals and
communities impacted by poverty.