Empowering Women through Social Business

by Md Robayt Khondoker

The idea of social business introduced by Nobel Laureate Professor Muhammad Yunus has already drawn attention from all sections of people across the globe. Today, social businesses exist in developing and developed countries alike. From big to small size corporations have come forward to set up social business companies to combat pressing global issues such as poverty, public health, environment, sustainable energy, quality education and natural disaster management issues. Universities are opening social business centers to study, research, and promote social business all over the world. So far 31 universities from twelve different countries have opened Yunus Social Business Center (YSBC) (Yunus Centre, personal communication, 23 November 2016).

Investments into six social businesses were announced at the 329th Social Business Design Lab. Six young entrepreneurs, children of Grameen Bank borrowers are seen in the photo with Nobel Laureate Professor Muhammad Yunus. Photo: Yunus Centre

One of the famous sayings of Nobel Peace Laureate Muhammad Yunus is that

“I love to deal with the problems and bring solutions to it”.

For more than four decades, Grameen Bank, which Professor Yunus founded in 1976, has been pioneering programs to alleviate poverty, particularly among women, through micro credit programs. Later, by establishing a series of Grameen companies, he has effectively addressed specific social development needs or particular social situations.

By definition, the main objective of social business is solving a social problem by producing some socially-oriented products or services and help people climb out of poverty. It is neither a not-profit business initiative nor a profit maximizing one. As Yunus, Moingeon and Lehmann-Ortega (2010) clearly wrote,

“[S]ocial businesses need to recover their full costs so they can be self-sustainable. Their owners never intend to make profits for themselves (there are no dividends), but they are entitled to get their money back if they wish ”.

Each social business is designed to address a different problem affecting people at the bottom of the economic pyramid. It is providing a solution to a lot of societal problems, including providing better health care facilities to rural people (Grameen GC Eye Care Hospitals- giving low-cost eye care to the patients at a significantly reduced, or even negligible, price), nutrition to children (Grameen-Danone- selling yoghurt door-to-door at a very low cost in the rural areas of Bangladesh), and providing access to solar energy (Grameen Shakti) to the unreached communities living far from today’s existing grid system.

One of the main features of social business is that it usually puts women at the center of all economic and social activity. The idea is to empower women as well as invest them with the responsibility to oversee the affairs of an organization designed to serve the needs of a particular community.

In January 2013, Yunus Centre (Office of Professor Muhammad Yunus) launched a platform called Social Business Design Lab to bring the Nobin Udyakta in Bangla (New Entrepreneurs or “NU”) and potential investors face to face. The idea is to “[B]ring the entrepreneurs to present their social business designs in front of a group of experienced business executives and social activists, to seek their advice”.

While explaining the need for NU program, Professor Yunus wrote that:

“The need for the New Entrepreneurs initiative grew out of the frustration of millions of young people, including the educated youth from Grameen families, who’d completed their college training through education loans from Grameen Bank — but were unable to find jobs. We tried giving them loans to set up businesses. It did not take off”

He further mentioned:

“The New Entrepreneurs initiative offers an innovative, replicable model for tackling the problem of youth unemployment that promises to be more direct and effective than traditional approaches. Rather than creating jobs as the uncertain by-product of a corporate project or a government program, it helps young people create their own jobs by launching businesses with equity funding from investors. The investors are also providing additional support in form of advice, training, and guidance”

In February 2017, 481th Design Lab took place at the Grameen Bank Auditorium. More than 14,000 projects have been presented in the Lab programs so far, of which 13,000 projects have been approved for equity funding investments ranging from taka one lakh to five lakh (USD) for Nobin Udyokta project. Each business plan was presented by the young entrepreneurs, including all the details of the project plan, investment needed, monthly and annual profits, marketing plan, break-even point for the business, and payback period of their investment and sustainability plan. The projects were then discussed in detail in plenary and in-depth group discussions

Twenty years old Ms Afsana Jahan who just completed her BBA presented her business plan on rearing and selling pigeon at the 25th Social Business Design Lab. Her mother is a Grameen Bank borrower. Courtesy: Nasir Ali Mamun.

The most noteworthy part of the design lab programs is that they provide the conditions for participants to engage in a dramatic reversal of roles, from powerless to the empowered. For example, at the 71st Lab, six new Nobin Udyokta presented their business plans. Many of the projects presented innovative solutions to extreme poverty and show great potential for further replication and expansion in the global market. Four of these six entrepreneurs were young women, heads of households, and some of them illiterate, asset-less, destitute.

The social business projects are already having some positive impact in the rural society, particularly on women. Their access to income-earning opportunities helping them to challenge everyday realties that they had to confront due to power relations existing within their families, as well as in the greater society. Traditionally regarded as financial liabilities by the family, now their entrepreneur quality and earning capacity has had the effect of transforming this view. With each passing day, more and more women entrepreneurs are joining in the social business club, working hard to bring change to their lives as well as to their community

Though there are some good accomplishments but the business model is not without criticism in the development community. Some argue that it is truly challenging to bring a right balance between a social mission, environmental sustainability, and commercial viability. Critics ask the question whether social business is appropriate to address all kinds of social issues — as it envisions. For ethical reasons, some problems in the society should not be tackled in a business way, even if they are socially-oriented. There is also a question on the monitoring and evaluation of the social business projects. It is largely unclear how to measure the performance of a social business company in achieving the social objectives. Finally, there is a question of sustainability since statistical evidence for the contribution of social businesses to the social sector’s overall performance is not sufficient till now. Therefore, as a business model it still has to prove its long-term sustainability.

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