Grameen Intel Social Business Ltd.

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Grameen Intel

Information technology solutions for rural entrepreneurs providing services in their local communities.
During a visit to Bangladesh in 2007, Intel Chairman Craig Barrett met with Nobel Peace Laureate Muhammad Yunus and decided creating a social business with a focus on technology.



Software Products


In AGRICULTURE, individuals or organizations providing soil testing services can use their eAgro products like ankur and mrittikā to help increase crop yields.

 

mrittikā is a soil nutrient analysis and recommendation software. Rural entrepreneurs providing soil testing services to the farmers use mrittikā to analyze and recommend fertilizers. This helps reduce input costs and achieve optimal yields.

ankur is a seed selection and recommendation application. This application analyses the season and farmer's land  condition and prescribes the best seed.

 

 
In HEALTHCARE, health clinics can use products like dolnā and shumātā to improve mother and child health outcomes.
 
 
shumātā is an ante-natal care monitoring and tracking software for pregnant women. Mobile health workers, doctors at rural clinics and health administrators can use this software to identify high risk pregnancies early on.This ensures appropriate follow up and regular ante-natal care.

dolnā is a vaccine scheduling and tracking software for newborns and infants using SMS. Mobile health workers, doctors at rural clinics and health administrators can use this software to ensure that infants are given all their required vaccinations on time.


 
 
Our vision is to create technology solutions to connect and improve people's lives around the world. For more information visit us at www.grameen-intel.com.

Grameen Danone

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Grameen and Group Danone went into a joint venture to create a yogurt fortified with micro-nutrients to decrease malnutrition for the children of Bangladesh. The yogurt is produced with solar and bio gas energy and is served in environmentally friendly packaging. The first plant started production in Late 2006. The 10-year plan is to establish 50+ plants, create several hundred distribution jobs and self-degradable packaging.


Update on Grameen Danone

Grameen Veolia Water Ltd

Background

Nature has bestowed the blessing of abundant fresh water on Bangladesh, in the form of numerous groundwater resources that are not too deep and are therefore easy to exploit. Nearly 8 million wells were bored during the 1970s and 80s, which now give almost 90% of the population access to water. However, for essentially geological reasons, almost all of the groundwater has been found to be contaminated with arsenic, very often at levels that make it a heath hazard. At the beginning of the 1990s, hospitals in Bangladesh started reporting an alarming increase in the number of cases of arsenicosis. Today, more than 30 million Bangladeshis have fallen victim to chronic arsenic poisoning and some have even died.
 
Against this background, Grameen and Veolia Water have decided to join forces and combine their complementary skills to make clean and safe water accessible to villagers in the poorest parts of Bangladesh.

Joint Venture

A new company was formed and registered in Bangladesh under the name of Grameen-Veolia Water Ltd. It is jointly owned at parity by Grameen Healthcare Services (a Grameen subsidiary for health and hygiene) and Veolia Water AMI (Veolia Water's subsidiary for Africa, the Middle East and the Indian subcontinent) and its task will be to build and operate several water production and treatment plants in some of the poorest villages in the center and south of Bangladesh. All in all, 100,000 people in around 5 villages are forecast to be served by this initiative, for a total investment of USD 800 000.
 
Veolia will provide the technical know how and the transfer of technology while Grameen will provide its local knowledge and networks in rural Bangladesh for the success of this project.
 
Grameen Veolia Water Ltd is a 50-50 joint venture. The new company has been established based according to the social business philosophy of Professor Muhammad Yunus.
 

Social Business

The aim of a social business is to have a social goal that the company can pursue on behalf of its investors. At the same time a social business is aimed at being self sustainable meaning it must attempt to avert losses just as any other normal company.
 
When profits are accumulated only the amount of invested shall be returned to the investors. Thereby not giving back dividends beyond the amount invested. Profits are reinvested for expansion and further social benefit by providing a good or service at the best price to help the people. To sum it all a social business is company aimed at providing a good or service to help the people while operating with the motto of No Loss, No dividends.


General scope

Grameen Veolia Water Ltd will develop projects in 5 different villages. For each of them, the company will invest in a production / distribution unit of drinking water, and operate it.
 
Every plant will produce water according to WHO standards by treating surface waters. Drinking water will be, in each village, distributed via stand-pipes, through a dedicated network. At this stage, no domestic connection is forecast.
 
Main usage for water will be for drinking and cooking. Daily consumption for a 6 person family is estimated to be 30 Litres/day.
 
According to the social business model, drinking water will sold at factory gate for 1 Bangladeshi taka per 10 litres (1 euro cent per 10 litres).


First project: Goalmari Union

The first project will take place in Goalmari, a village located 50 km east of Dhaka.
 
Goalmari's population is about 25 000 inhabitants. The local population use groundwater for cooking and drinking but 83% of the deeptuble are naturaly contaminated in arsenic (>10µg/L). As the surface water is not contaminated in arsenic, the plant will use river water and provide it via a pipeline network, to tap point located in clusters.

Goalmari network will reach first the poorest part of the population of Goalmari living on the bend of the river (impacted by monsoon high water level). To provide the water to farer isolated area, some other distributing systems are being studied, like rickshaw water transportation.

The water will be further distributed by stand pipes where Grameen ladies can dispense the water at certain times during the day when people bring there pitchers or jars. These points will be located at key areas of the villages.
 
The water will also be transport at a slightly higher cost by an Auto rickshaw fitted with a water tank to people who prefer to travel the least to collect there and have a higher disposable income.


Other Projects

Projects on 4 other villages will be implemented as soon as possible after Goalmari:
  • Start up of village no. 2 (Padua Union) is scheduled in 2010.
  • Start ups of villages no. 3 and 4 are scheduled in 2011 and village 5 in 2012.

Grameen BASF

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Grameen and BASF went into a joint venture because there are area's in Bangladesh where there is a high risk of catching Malaria (58K newly infected in 2007). The product created is a mosquito net to protect against malaria, which that families would sleep under. Half a million nets have already been produced. The idea of the joint venture was to develop affordable products for the poor that could protect them from deadly diseases. Grameen BASF have also started the production of micronutrient sachets to sprinkle on food, which provides essential nutrients that are missing from the poors daily diets.

Grameen GC Eye Care Hospital

In 2001, GB established the Prevention of Cataract Blindness Project, which has now become the Grameen GC Eye Care Hospital in Bogra as a social business. A second Eye Care Hospital has now been built in Barisal, in southern Bangladesh, which began operating in April 2009.

Professor Muhammad Yunus and The Green Children opened First Grameen Eye Hospital in Bangladesh on May 12, 2008 Structured as a Social Business Enterprise, Facility Can Potentially Grow To Perform 50,000 Examinations, 10,000 Cataract Operations Annually

[At the inauguration of the Grameen GC Eye Care Hospital]

The first Grameen Green Children Eye Hospital, projected to perform 50,000 eye examinations and 10,000 cataract operations annually, will be opened by 2006 Nobel Peace Prize laureate Professor Muhammad Yunus and the Minister of Health of Bangladesh at 4:00 PM on Monday, May 12.

The international pop music duo Milla Sunde and Tom Bevan of The Green Children raised $500,000 from donations and CD/DVD sales for the first eye hospital in Bangladesh. The two highly talented musicians are committed to working to raise funds for a second eye hospital that will require a total of about $1 million to complete.

The Grameen Green Children Eye Hospitals, modeled after the highly successful Aravind eye hospitals in India, will be structured as social business enterprises described in the new book by Professor Yunus, Creating a World Without Poverty: Social Business and the Future of Capitalism. The Aravind system in India currently does 1.7 million examinations and 250,000 operations a year.

Once the first eye hospital physicians, surgeons and other staff have been trained and fully operational, it will work to become self-sustaining and perform a projected 50,000 eye examinations and 10,000 cataract operations per year.
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Both hospitals will charge patients based on their ability to pay, with wealthier clients charged at a slightly higher rate and the poor a little less. Everyone will receive the same high-quality treatment. While all patients will be expected to pay something, no one will be denied care. Those with no funds will be asked to pay later, when they can.

The key to the success of the model is a system that delivers very high quality at an affordable cost by using high volume and having highly trained technicians doing most of the examination and preparation work so that ophthalmologists can focus on the operations. The model has been so successful in India that representatives of some of the leading medical schools in the United States have visited Aravind to bring some of the lessons learned back home.

A rising international band, The Green Children recently signed to the world's largest music label, Universal Music Group. The duo comprises Milla Sunde from Norway and Tom Bevan from England. Their debut record with Universal Records will be launched later this year. In addition to their flourishing music career, Tom and Milla have been working for several years with the foundation they jointly established.

The Green Children Foundation supports microcredit, education and healthcare and is focused on engaging young people in supporting positive and effective solutions to conquer world poverty.

In 2006, The Green Children made their second trip to Bangladesh to film a music video for their song "Hear Me Now", which tells the story of a successful women borrower of Grameen Bank. This video has been used in fundraising for the eye hospitals and will receive a world wide release later this year.
Grameen Bank, and the concept and methodology of micro-credit that it has elaborated through its 30 years of work, have contributed to enhancing the chances of peace by reducing poverty. Grameen Bank Project was founded by Professor Yunus in the village of Jobra, Bangladesh, in 1976. In 1983 it was transformed into a formal bank under a special law passed for its creation. It is owned by the poor borrowers of the bank who are mostly women. It works exclusively for them. Borrowers of Grameen Bank at present own 94 per cent of the total equity of the bank. Remaining 6 percent is owned by the government. Dr. Yunus and the Grameen Bank jointly received the Nobel Peace Prize in Oslo, Norway, in December 2006.  

Seven Principles of Social Business

 

 

  • Business objective will be to overcome poverty, or one or more problems (such as education, health, technology access, and environment) which threaten people and society; not profit maximization

  • Financial and economic sustainability

  • Investors get back their investment amount only. No dividend is given beyond investment money

  • When investment amount is paid back, company profit stays with the company for expansion and improvement

  • Environmentally conscious

  • Workforce gets market wage with better working conditions

  • ...do it with joy

Grameen Healthcare

japExtending the Success of the Principles of Microcredit to Health Care Delivery

Mission and Overview

The Grameen Bank and other microcredit programs have proven that bottoms-up business models can enable the poor to lift themselves from poverty and are sustainable. The 2006 Nobel Peace Prize recognized the impact microcredit has had--and will continue to have--in enabling millions of families around the world to break the cycle of poverty once and for all. Many of the families of Grameen borrowers have gone from illiterate and poor to educated professionals in a single generation.

In establishing Grameen Healthcare (GH), Grameen aims to extend the success microcredit to health care. The mission of GH is to establish sustainable best practices in a broad range of health care services for a broad market for the entire population but focusing on the poor and poorest.

GH will enable the poor to be self sufficient in addressing their health care needs such that they can accept but not require outside assistance. This mission will be developed in a number of ways that complement one another:

  • GH will design and develop a bottoms up health care infrastructure that can take lessons from successful efforts around the world and improve upon them to deliver the highest quality health care, in an efficient and sustainable manner, primarily to the poorest of the poor.
  • To achieve these goals, GH will build on the network of existing Grameen Clinics which are already providing primary healthcare at the village level in various locations of Bangladesh.

What Grameen does now: Grameen Kalyan, Grameen Healthcare Services, Grameen Healthcare Trust

GB began a health program in 1993 to provide care for Grameen borrowers and the rural poor in Bangladesh. The goal is to provide quality health services with qualified medical personnel at an affordable cost.

An infrastructure was established that has grown to 51 Grameen Clinics (GCs) that include a pathological laboratory and pharmacy, and satellite camps along with community health outreach, and emergency services. Grameen Kalyan is implementing these health clinics.

The GCs are led and managed by a licensed physician, who is assisted by one or two paramedics, a laboratory technician and six community health assistants. This network currently operates with 93% cost recovery.

The GCs typically serve a population of 50,000 persons living within 8-10 kilometers of the clinic.

In 2001, GB established the Prevention of Cataract Blindness Project, which has now become the Grameen Eye Care Hospital in Bogra as a social business. A second Eye Care Hospital has now been built in Barisal, in southern Bangladesh which will begin operation in April 2009.

A vital component of these health programs is the accompanying micro-health insurance scheme to encourage positive health seeking practices. This serves a dual purpose of enhancing utilization of health services and improving cost-recovery to achieve sustainability. An integral part of the Grameen approach is the 'sixteen decisions' which guide all GB borrowers and their families toward productive living. Indeed, more than half of these 16 decisions directly address the health and well being of borrowers and their families. Thus, the basic principles of learning organizations and an overall vision to support the well-being of the poor have been pillars of the Grameen approach.

While initial evaluations of the GC network and its health impact are positive, continuous improvements in coverage, disease prevention, quality of care and sustainability remain as top priorities. Moreover, it is critical to identify and strengthen processes underpinning the success of this model, and promote the key principles of social entrepreneurship for health to create a sustainable and replicable model that will expand throughout Bangladesh and to other countries.

Grameen Healthcare will continue to expand, strengthen and upgrade the network of Grameen clinics with the aim of transforming them into Grameen Health Management Centers with a focus on awareness, prevention, diagnosis and early detection.

The following key elements form a foundation on which to build:

  • An integrated health network which would include a hospital centre hub including a medical college and a teaching hospital, one or more  nursing colleges, and a network of primary and specialist clinics such as a Mother and Child Clinic. These will provide care in a variety of critical focused areas and, as an extension of the primary and specialist clinics, rural clinics (both locally fixed and mobile) will bring health care to the doorsteps of patients. These clinics will be modular so that they can be built step by step once sustainability has been proven. All tiers of the healthcare system will be linked and facilitated by information and communications technology.
  • Grameen plans to convert the Grameen Clinics into Grameen Health Management Centers which are focused not only on treatment but which become centers which focus on awareness, prevention, diagnosis and early detection rather than just treatment which is inevitably costlier especially for low income families. The Grameen Clinics will target all families in the area not only Grameen members. Its main focus will be children, adolescent girls and mothers. A primary goal of the Grameen Health Management Centers will be to dramatically reduce infant and maternal mortality rates in the catchment areas.
  • Grameen Healthcare is working with world class diagnostic companies to develop simple customized hand held diagnostic equipment designed for easily diagnosis of breast lumps and pregnancy related problems.

Within the Grameen Healthcare system, young women within the villages will be encouraged to become entrepreneurs who will go house-to-house and operate and sell the use of this equipment for the detection of  lumps in the breast, incorrect positioning of foetus and other problems which can be detected with simple imaging device.

These young women will operate a self sustaining business of their own based on this equipment but will be linked closely to the Grameen Health Management Centers for referral purposes, which in turn will be linked to specialist doctors at the city level.

  • An information architecture, including electronic medical records, telemedicine, decision support, and other IT tools for physicians, nurses, technicians, other health professionals, and patients at the point of care. This information architecture will feed into existing public health education programs, including formal health training and informal education opportunities designed like the regular weekly meetings between microfinance banks like Grameen and their borrowers. Several partner organizations are currently working with Grameen to upgrade the capabilities of the Grameen clinics including development of patient data system of Grameen clinics.
  • A bottoms-up focus on understanding and meeting the health care and research needs of the poor as reported by the poor themselves and their local health providers. GH will focus on the needs of the poor, and their needs and solutions will probably be different from those in the developed world. They will, though, be of benefit to the developed world as well. User-generated content from disease-specific and other patient associations will help to gather and prioritize key needs and disseminate best practices.
  • Everyone will pay something for their care at the point of service, but no one will be turned away because of inability to pay. Payment at the point of service is important because it establishes the value and sustainability of the service and affirms the rights and self-respect of patients and providers. Those who are unable to pay will be asked to promise some payment at a future date, but no one will be turned away. There will be tiered pay schemes, for several levels of income.

Integrated Health Network

A new Grameen medical college and hospital in Bangladesh will be an important focal point of the project. This medical college and teaching hospital will be developed into one of the most advanced in the country, treating patients from all strata of society with the best methods possible. Additionally, a strong research and training component will be part of the medical and teaching hospital system.

Grameen is in the process of securing a large piece of land to build the medical college and hospital and associated institutes. It is negotiating with several world class hospitals to collaborate on the set up of the Grameen medical college and hospital.

The Mother and Child Health Care Institute will be focussed exclusively on mothers and their children up to the age of 5. Services offered include pre-natal care, maternal and pediatrics. The Institute will also deal with anemia and malnutrition in children and ensure that the children receive the appropriate vaccines within the right period of time. Where home visits are not possible, E-Health and local Grameen Healthcare Management centres will ensure continued care of mother and child. The Grameen Healthcare system as a whole will be focused on the care of children, adolescent girls and mothers.

Nursing Colleges will be another way to train and empower young women in rural areas, especially those who are daughters of Grameen borrower families. Currently Grameen Healthcare is planning on establishing two nursing colleges are being planned, one in Dhaka and one in Chittagong. Grameen Bank will offer education loans to young women to train at the nursing colleges. The colleges will provide both BSc and diploma courses in nursing. Once they are trained and qualified the nurses would enter both local and international market for nursing professionals. With their income they will repay their education loans and contribute to the local and national economy through remittances to their families.

The hospitals and clinics will collaborate closely on relevant areas of research with research institutions worldwide.

A technician college will be established as a part of this project which will maintain medical equipment belonging to the Grameen medical system but also beyond.

Information Technology Architecture

GH will identify and expand best technology practices for sustainable health care delivery in developing countries, including the establishment of biobanks; cell-phone- and Internet-based treatment, decision support, and outcomes reporting; and the introduction of electronic medical records.

Grameen Healthcare plans to build on the country wide mobile phone network to transmit critical medical information from remote locations to the medical centers in the towns and cities and work to fulfill the immense potential of e-healthcare in the country.

By addressing information technology issues now, as the health care network is being established, GH will be able to institute an advanced electronic network that will make it much easier for health care professionals to share information and deliver better care. This health database centre will also greatly accelerate research. GH can and will design and deliver sustainable world-class technical capabilities and education to remote areas and will link to more centralized hospital and lab facilities necessary for the more specialized services to be cost-effective.

Health-related social businessese

Grameen is collaborating with multinational companies like Danone, Veolia and BASF to bring health related social businesses to the poor of Bangladesh.

Grameen Danone and BASF Grameen address malnutrion among the rural population through the production and sale and fortified yogurt in the case of the former, and multiple micronutrient sachets in the case of the latter which address deficiencies in the diet especially among children and pregnant/lactating mothers.

In addition, BASF Grameen will produce and sell long lasting treated mosquito nets to combat mosquito borne diseases such as malaria and dengue in Bangladesh.

Grameen Veolia has developed a social business to bring clean drinking water to rural population in arsenic contaminated areas of Bangladesh. The first water treatment plant is in operation, and many more are planned across Bangladesh.

Many more such social business collaborations which bring health benefits for rural population are being developed.

Structure and Governance

GH will be a social business which will draw upon the experience and advice of an advisory board, a network of subject matter experts, and partners at institutions worldwide.

An important part of the governance will be the advisory board, which will include leaders from Bangladesh as well as other global leaders from highly ethical and patient-oriented organizations to ensure that the social goals are being met and the interests of the patients are respected.

Social Business

Social business is a cause-driven business. In a social business, the investors/owners can gradually recoup the money invested, but cannot take any dividend beyond that point. Purpose of the investment is purely to achieve one or more social objectives through the operation of the company, no personal gain is desired by the investors. The company must cover all costs and make profit, at the same time achieve the social objective, such as, healthcare for the poor, housing for the poor, financial services for the poor, nutrition for malnourished children, providing safe drinking water, introducing renewable energy, etc. in a business way.
 
 
The impact of the business on people or environment, rather the amount of profit made in a given period measures the success of social business. Sustainability of the company indicates that it is running as a business. The objective of the company is to achieve social goal/s.

 

Clarifications on Social Business

I am not opposed to making profit. Even social businesses are allowed to make profit with the condition that profit stays with the company; the owners will not take profit beyond the amount equivalent to investment. Social business is a new category of business. It does not stipulate the end of the existing type of profit-making business. It widens the market by giving a new option to consumers. It does not intend to monopolise the market and take the existing option away. It adds to the competition. It brings a new dimension to the business world, and a new feeling of social awareness among the business community.
 
 
When we approach the concept of social business from the philanthropy side, it looks very convincing and logical. Why should everything in philanthropy be given away? If some of these goals can be achieved more efficiently and sustainably in a (social) business format, then why not take that route? After all our purpose is to achieve the social goal.
 
 
But when you approach it from the orthodox business side, it tends to look a bit out of tune. Why on earth give up profit? Why should anyone run a business without profit? I understand the surprise perfectly.
 
 
Let me clarify: I am not asking any businessperson to give up any of their businesses. Nor am I asking them to convert some of their businesses into social business. The idea of "giving up" something creates this shock wave. I am not asking anybody to "give up" anything. All I am saying, if you are worrying about a social problem (while totally engaged in your routine business) I have a message for you, you can make a significant contribution in resolving the problem. If you put your mind seriously into it, you may even open the door to eliminate the problem globally. You can do both: conventional business and social business.
 
 
It is all upto you to decide whether you want to do a such thing or not. Nobody will raise an accusing finger at you if you do no such thing. But you may feel happy if you do it. I am suggesting a way which may make you a happier person.
 
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A Learning Process
 
It is a great learning process. You are doing things which you never did before. You are thinking in a way which you never did before. You are surprised to see you are enjoying it a lot. You start digging into your experiences to see what is relevant for the task. You check through the reservoir of technology that you are familiar with, start contacting the pool of experts that you have gotten to know in your business, to achieve your new goal. You start exploring a new world which was totally unknown to you. You realise that you are now wearing "social business glasses" on your eyes, you see things which you never saw before. You start sensing that your eyes were fitted with "profit-maximizing glasses" all along, while you thought these were your natural eyes in your economic world.
 
 
Now when you turn your eyes to your own profit-making businesses you start noticing things which you never noticed before. You bring new-gained experiences from your new business to your old businesses. Slowly you move towards becoming an multi-dimensional person, rather than a robot-like person.
 
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Some people ask me why can't you run businesses with some profit and some social benefit "doing well by doing good", as it is popularly described.
 
 
Of course, it can be done. I am never against it. But I am trying go to the ultimate point where you don't make any profit for yourself at all. This is easy to identify, easy to handle in day to day decision making.
 
 
When you mix profit and social benefit it gets complicated for the CEO. His thinking process gets clouded. He does not see clearly. More often this CEO will take decision in favour of profit, and exaggerate the social benefit. Owners will go along with it. Social business gives a clear unambiguous mandate to the management. There is no balancing act involved. If you can agree to take a "small" profit, you can also persuade yourself to take zero profit. Once you get there you get rid of all old ways of thinking. You prepare yourself to explore a new world, a new way of seeing things, and doing things in a different way. When you were in the world of a "small profit" you were still operating in the old world, with old ways of doing things, only restraining yourself here and there.
 
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Another way to put the same question is: Why can't you allow thee investors in social business to get a small fixed profit say, 1% dividend. My answer is the same. I may describe this situation by saying something like this: you are in a "no smoking" building, you are arguing "Why can't I be allowed to take just one small puff ?" Answer is simple it destroys the attitude. In Ramadan, Muslims are not allowed to eat or drink until the after the sunset. Why not take a sip of water during the day? It destroys the strength of the mental commitment. You lose a lot for a small favour.
 
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Social business is about making complete sacrifice of financial reward from business. It is about total delinking from the old framework of business. It is not about accommodation of new objectives within the existing framework. Unless this total delinking from personal financial gain can be established you'll never discover the power of real social business. Some times you can set up a technically correct social business with the purpose of making profit through your other companies by selling products or services to this social business company. This will be a clear sabotage of the concept. There may be many other subtle ways by which one can weaken the concept and practice of social business. A genuine social business investor must make all efforts so that he does not walk into this trap unwittingly.
 
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Capitalism has created poverty by focusing exclusively on profit. It built a fairy-tale of prosperity for all. This never happened. That's why Europe decided to entrust the government to take care of poverty, unemployment and health. They were smart enough to figure out the emptiness of capitalism in solving these problems.

Author's Summary on Creating a World Without Poverty

While free market capitalism is thriving globally, almost unopposed now, and bringing unprecedented prosperity to many, half of the world lives on two dollars a day or much less. Eradication of poverty remains the biggest challenge before the world. Colossal social problems and deprivations, mostly poverty-related and very unevenly distributed around the globe, continue to shame us everyday. Obviously the free market has failed much of the world. Many people assume that if free markets can’t solve social problems, then governments can. After all, the government is supposed to represent the interests of society as a whole. But decades and even centuries of experience has shown that while government must do its part to help alleviate our worst problems, it alone can not solve them.
 
 
Fortunately for us there is a keen desire among many to lend a hand through charity, for addressing the problems of poverty and other social problems. Charity is rooted in basic human concern for other humans. These days concern is usually expressed in the shape of non-profits and NGOs which may take various names and forms. Then there are aid organizations sponsored by rich governments' bilateral and multilateral. Nonprofits and aid organizations are trying to keep the problems within some control. But charity is a form of trickle-down economics; if the trickle stops, so does help for the needy. On the other hand multilaterals like World Bank focus only on growth as the means of helping the poor, but can not see that the poor people can be actors themselves. There are serious questions about the type of growth that can help the poor. As another response to the global social problems some businesses are identifying themselves with the movement for Corporate Social Responsibility (CSR), and are trying to do good to the people while conducting their business. But profit-making still remains their main goal, by definition. Though they like to talk about triple bottom lines of financial, social, and environmental benefits, ultimately only one bottom line calls the shot: financial profit.
 
 
I always believed that poverty can be totally conquered in our own lifetimes if the right approach is adopted. I based my belief on the inherent ability of the poor that can be unleashed once they are given the opportunity to help themselves. This I have proved in action through my three decades of experience with Grameen Bank. The concept of microcredit did not exist before I initiated Grameen Bank in Bangladesh, which basically recognized that credit without collateral is a fundamental right of the poor. Our success with this in my own country has been widely replicated all over the world including in some of the richest countries; and the Nobel Peace Prize 2006 for Grameen Bank and myself is one recognition of that success. The story of Grameen Bank has been told in my earlier book: "Banker to the Poor". In this new book I have described the further evolution of Grameen System. But more importantly I have introduced and elaborated here my broadened concept of social business, that the Grameen experience has led me into.
 
 
Grameen allowed the poor to be an actor in the free market and to enjoy some of its fruits to try to come out of poverty. It is fundamentally a business model, pure and simple, but a social business. There can be other social businesses. They are just like any other business; but for social objectives and not for personal gain or dividend. I have tried to show in the book why social business can succeed in addressing social problems where other means mentioned above have failed. social business should not be confused with the term social enterprise which is used in a more encompassing sense and includes NGOs, personal initiatives, charities, etc., and may include social business too.
 
 
Social business introduces a totally revolutionary dimension to the free market economy. It does not interfere with the mechanism through which the normal Profit Making Business (PMB) works and prospers capitalization, expert business management, competitiveness etc., but investors here do not receive any dividend, though they can recover their investment if they want to, to reinvest in other social businesses or PMBs. The satisfaction gained in achieving the stated social goals are the only motive behind the investment, and the business will be evaluated according to that standard. Essentially it is a non-loss, non-dividend business aimed at social objectives education, health, environment, whatever is needed to address the problems faced by society. The profits here remain with the business and help it to grow further. The whole thing is based on the premise that entrepreneurs need not be motivated only by the profits they personally receive, but can also be motivated by social goals and may enjoy success there with equal satisfaction. The important thing is not to mix up a Social Business with a PMB. In fact the inclusion of Social businesses alongside PMBs in the business world will give the free market capitalism a larger, nobler and a more fulfilling purpose. Its advantages over straightforward charity are many efficiencies, continuous use with each turnover, competition with PMBs following the same rules, utilization of business innovations being some of the most important ones.
 
 
There can be two types of social business. Type One focuses on businesses dealing with social objectives only, as has just been mentioned. Type Two can take up any profitable business so long as it is owned by the poor and the disadvantaged, who can gain through receiving direct dividends or by some indirect benefits. There are various ways how the ownership can go to the poor. The two types can be mixed together in the same social business as has happened in the case of Grameen Bank. In a similar mixture of the two types, a socially beneficial rural toll road or bridge can be built by a company as a social business whose ownership will belong to the poor. On the other hand a huge project such as the Deep-Sea Mega Port in Bangladesh, which I have been advocating for, which will be used by several countries in the whole region and can potentially change the economic face of Bangladesh, can be built as a social business owned by the poor women of the country.
 
 
Is this an utopia? Will there be social businesses outside the realm of microcredit? Who will invest in such social businesses? I could answer these questions confidently in my new book, not only because I have faith in my idea and on the ability of the entrepreneurs to have social motives as well as profit making motives; but also because I am seeing this actually to happen at this very moment. I have devoted a good part of the book on the details of the first such social business we have started Grameen Danone Company which went into operation in early 2007. The idea of the company was born over just a casual lunch I had with Franck Riboud, the Chairman and CEO of Groupe Danone, a large French corporation a world leader in diary products. It took just that time for me to convince him that an investment in a social business is a worthwhile thing for Danone shareholders. Even though it will not give any personal dividend to them, he agreed to the proposition even before I fully explained it to him. It took somewhat more time to fix up the modalities, the product (a fortified sweet yogurt for the poor malnourished children of Bangladesh at a price they can afford), the financing, tax and regulatory issues, new yard sticks for evaluating business and many other such details. And I have devoted many pages of the book on these details to show how all these things can be taken care of. The yogurt "Shokti Doi" (Energy Yogurt) is already in the market.
 
 
The Grameen System has invested in a second social business this time an Eye Hospital where the poor can have eye treatment and cataract operations at a very low cost and all others in the small town and the villages around will have an excellent medical facility where there was not any like that before.
 
 
Social business is a new concept and its practice is just beginning. As my book reveals, it has to make a lot more exploration while gaining more experience. There are challenges to be faced and solutions to be developed. For example, we had to invent a totally innovative marketing system to keep the market fragmented so that the low cost "Shokti Doi" is reserved only for the poor children and does not disappear in the urban market for the well to do. I have also touched upon other issues such as how can the ownership of the Type Two social business be transferred to the poor, or how can the wonderful opportunities offered by IT be best deployed for social business.
 
 
One thing is very clear to me that with social business taking off, the world of free market capitalism will never be the same again, and it then will really be able to deliver a deathblow on global poverty. I am sure, many business wizards and successful business personalities will apply their abilities to this new challenge the challenge of creating a poverty-free world within a short time. At the moment we are seeing merely the line of horizon. Soon a good part of business genius, creativity and innovation of the world will devote itself to this new goal of social good. A whole new stock market with its new indices will thrive in the financial capitals of the world motivated by this new incentive. It will accelerate the process of poverty eradication to an unthinkable pace using the same market mechanism which accelerated the global prosperity for the rich in the first place.
 
 
Welcome to the new world of social business.
 
 
Muhammad Yunus
 
25 December 2007

Types of Social Businesses

Type I: focuses on businesses dealing with social objectives only.

Eg. The product produced is for the benefit of the poor.

Type II: can take up any profitable business so long as it is owned by the poor and the disadvantaged, who can gain through receiving direct dividends or by some indirect benefits.

Eg. The product could be produced by the poor but exported to an international market while net profits would go towards workers benefits.
 
Wikipedia: Social Business