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Posts Tagged ‘social business’

On October 10th 2017, David Bornstein wrote a piece for the New York Times FIXES section which looks at solutions to social problems and why they work. David Bornstein is the author of “How to Change the World,” which has been published in 20 languages, and “The Price of a Dream: The Story of the Grameen Bank,” and is a co-author of “Social Entrepreneurship: What Everyone Needs to Know.” He is a co-founder of the Solutions Journalism Network, which supports rigorous reporting about responses to social problems.

His piece for the NYT, Giving Capitalism a Social Conscience, is an interview with the amazing Professor Muhammad Yunus. the Bangladeshi founder of the Grameen Bank and recipient of the 2006 Nobel Peace Prize. They discussed, amongst other things, his new book, “A World of Three Zeros: The New Economics of Zero Poverty, Zero Unemployment, and Zero Net Carbon Emissions”. Below are some statements from Professor Yunus that I found particularly interesting.

  • The most powerful way to eradicate poverty is to unleash the untapped entrepreneurial capacity of people everywhere.
  • Poverty is not created by poor people. It’s created by the system we built. Poor people are like a bonsai tree. You take the best seed from the tallest tree in the forest, but if you put it in a flower pot to grow, it grows only a meter high. There’s nothing wrong with the seed. The problem is the size of the pot. Society doesn’t give poor people the space to grow as tall as everybody else. This is the crux of the matter.
  • Capitalism is in crisis and remains moored in a flawed conception of human motivation. A far more robust role in the economy for social businesses, “non-dividend” companies “dedicated to solving human problems.”
  • We need to abandon our unquestioning faith in the power of personal-profit-centered markets to solve all problems and confess that the problems of inequality are not going to be solved by the natural working of the economy as it is currently structured
  • In capitalist theory, it is assumed that man is entirely driven by self-interest. That’s definitely not the description of a real human being. Human beings are selfish, and at the same time they are equally selfless, if not more. They want to help others.
  • Capitalism is all about options. But in the economic system, there is only one kind of business: business to make money — and it’s made more extreme by saying it produces best results when one maximizes profit.
  • When we introduce the selflessness of people in the business world we get another option. Alongside conventional business, we add another type of business that will allow us to express our selflessness through business. The exclusive goal of this business, which I call social business, is to solve people’s problems.
  • Canadian company McCain Foods wanted to create a social business jointly with us. They have 60 percent of the French fry market in the world. Jointly we are doing a social business in Colombia. Many Colombian farmers struggle to make a living, like in many other countries. Campo Vivo, our social business, helps farmers grow potatoes and vegetables with high yields. Once McCain put on social business glasses, they started seeing new possibilities. They created Bon et Biento buy up these potatoes and produce potato soup. They hire youth who have been unemployed. They could make money from this, but they decided not to — to make the soup and vegetables good and cheap.
  • If you remove the personal profit motive and think only about solving problems, you will suddenly see lots of possibilities that you didn’t see before.
  • If selflessness becomes the driving force behind development of technology instead of personal profit, suddenly technology transforms into an enormously powerful force to change the world very rapidly. Then artificial intelligence will be developed to solve health care problems of people instead of taking away jobs. If you focus on the selfless part of human beings, the whole economy changes.
  • By the end of next year, Grameen America will have lent almost $1 billion to 100,000 borrowers, with repayment remaining nearly 100 percent. Over the next 10 years, Grameen America would like to double from 20 to 40 branches. Even with that modest growth, it can reach 500,000 borrowers by 2028. If more generous funding were available, it could reach a million borrowers. If it had a limited banking license, it could take deposits like we do in the Grameen Bank and its expansion will not be limited by availability of funds.
  • Schools can bring into the curriculum the idea that business doesn’t have to be profit maximizing. You can design it to solve people’s problems while you recover your costs and recycle your money. They can have assignments to design businesses to solve problems: how to bring clean water to a village; how to bring education, literacy, housing or health care to a remote community; how to make a crowded slum a decent place where there is health care, education, good roads. There are many universities setting up social business centers and teaching this. Every business school should be offering both conventional M.B.A.s and social M.B.A.s.

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Muhammad Yunus Credit Andreas Solaro/Agence France-Presse — Getty Images

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