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Investing in social businesses could put an end to poverty says Yunus
Corporates can help end global poverty by investing in "social business", Professor Muhammed Yunus, who in 2006 won the Nobel Peace Prize for pioneering microcredit that changed the lives of 7.5 million Bangladeshis, said yesterday.
- By Saifur Rahman, Business Editor
- Published: 14:05 April 13, 2008
- "A lot of companies throw their money in sponsoring matches or PR gimmicks as part of Corporate Social Responsibility," says Professor Mohammad Younus.
- Image Credit: Arshad Ali/Gulf News
Dubai: Corporates can help end global poverty by investing in "social business", Professor Muhammed Yunus, who in 2006 won the Nobel Peace Prize for pioneering microcredit that changed the lives of 7.5 million Bangladeshis, said yesterday.
"Instead of spending money in sponsoring football and cricket matches and concerts, public relations activities or charities in the name of corporate social responsibilities, companies can actually help change the world in freeing it up from poverty by investing in social businesses that will run like proper businesses with a social cause," Yunus told delegates at the International Islamic Finance Forum in Dubai yesterday.
"By simply putting away part of the proceeds, the large corporates could provide social services to the people that won't harm their growth. In turn, it will help the societies to move ahead."
The United Nation has targeted reducing poverty by half by 2015, which a recent World Bank report said might be difficult to achieve as rising global food prices and inflationary pressures are derailing some countries from the goal.
Dr Yunus, an economist, who defied conventional banking methods to help millions of Bangladeshi women living in extreme poverty, started a microcredit scheme in 1976 with just $27 spread among 42 women at a remote village in Chittagong that led to the establishment of the Grameen Bank - which now funds 7.5 million families through 27,000 staffs.
"We want to create a world free of poverty and exploitation. Poverty does not have to exist," he said. "It could disappear if businesses take up social responsibilities seriously."
A few years ago, Professor Yunus launched a beggar rehabilitation programme in Bangladesh, handing out as low as $15 per beggar to sell merchandise while begging door to door, with a hope that they would eventually give up begging. Today, this popular scheme has removed 11,000 from begging, out of a 100,000 beggar-borrowers, who are expected to become small-time traders.
He denounced spending money by charity, saying it does not serve the purpose.
"Charity takes away the initiative. Social business and microcredit create an enabling environment for people," he said.
He gave examples of Grameen Bank's recent joint ventures with European firms Dannon and Viola in providing food products and pure drinking water, helping millions of Bangladeshis recover from malnutrition and arsenic pollution.
Grameen Bank is creating a 100 million euro social business fund with Credit Agricole that will help entrepreneurs to develop social businesses, he said.
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