The corporate do-gooder

During a lecture at the London School of Economics this year, the celebrated Muhammad Yunus spelt out what it meant to reconcile social objectives with survival in the capitalist world. The dominant economic order is hard to fight, but perhaps there is no need.

Social work need not be incompatible with generating profit – “as long as you can have a system that will preserve your goodness.”

The Grameen model of social business is non-loss and non-dividend and is directed towards a specific problem. Investors get their money back, while profits are retained by the company for expansion and improvement purposes.

Professor Yunus’ approach was to think big and liaise with international partners to tackle grand challenges. “Nobody in the world should go without shoes,” he told Adidas.

Shoes are not merely an accessory, they play an important role in community health. There is a reason why malnourished children with bloated bodies are so often barefoot. Parasitic worms enter their bodies through their feet and stay there until a public health intervention can boast of success.

Adidas blanched: it was a dramatic ultimatum and there were many practical cost considerations to take into account. Professor Yunus was sent on a tour of the factory while the corporate authorities took stock of the situation.

At the end they agreed to send a research team to find out how to produce suitable, cost-effective shoes that could be accessible for the poorest families earning in Bangladeshi taka.

The company is scheduled to set up a factory in Bangladesh within this year.

This designing and marketing of a specific product for a specific objective would be an example of a Type I social business. Type II is exemplified by the Grameen Bank model, which invests profits generated by community shareholders back into the community in the form of schools, clinics, and so on.

Both are examples of innovative, self-sustained social entrepreneurships which are not reliant on external support.

The Pakistani context

There are few parallels of the social business system here, but there is certainly scope for the support of social entrepreneurship. Perhaps some embodiments are already visible in the form of deals for the construction of houses for the dispossessed victims of the floods. However, there is a real space for the Type II genre of projects, which can facilitate an ongoing process of building social capital.

It has already been established that paradoxical and strange though it may seem, there is much money to be made in the local development sector today.

Moreover, there is no guarantee that the foreign donors and clients will still be here after five years, let alone 10. It is important to think of ways by which processes of change can be stimulated, incubated and then set free.

One interesting investment that is currently being made by development outfits in Pakistan is in the form of community-based activists. All major Rural Support Programmes have included social mobilisation as part of their mandate and are willing to invest in training community-based representatives to engage the local people in development processes.

Pakistan Poverty Alleviation Fund (PPAF), the largest apex development agency in the country, has recently commissioned its partner organisations to develop “sparkplugs”, trained to motivate entrepreneurs for local economic development.

While the target groups for these sparkplugs have been identified as the impoverished and vulnerable, the knowledge of how to conduct enterprise will be shared within the community.

The objective of such a capacity-building initiative is to turn the open palm upside down, converting the hand that takes into the hand that gives. If talent is identified and nurtured in the right way, there is hope that it will spawn organic, creative ideas from entrepreneurs who know the local issues best.

Values have evolved over the years and the public, private, for-profit and non-profit development organisations in Pakistan have all adapted themselves for survival in the capitalist world order.

Still, the likes of Muhammad Yunus stand as reminders that capitalism need not be constructed on selfishness alone. The seventh principle of social business can work as a charm against such cynicism, across the development sector and beyond.

“... Do it with joy,” says Professor Yunus, and the essence of doing good will not be lost.

The writer  works for a development consultancy.

Published in The Express Tribune, November 15^th, 2010.