Social business for a sustainable world

Today's world is looking forward to building new ways towards a common destination for the next 15 years: Sustainable Development Goals (SDGs), leaving no one behind. Millennium Development Goals were an attempt to define an immediate destination over a short period. That was a good beginning. Social business can be one of the new highway signs to lead the world to its sustainable destination: safer, equitable and better world. To achieve our mission on this planet to make it a better place for everyone, microcredit pioneer Prof Muhammad Yunus identifies credit and equity disparity as the most powerful cause of income disparity for an equitable world. He emphasises initiatives for zero poverty, zero unemployment and zero carbon emission, and expansion of social business to meet this “three zero” goals and the post-2015 development agenda, based on four pillars: young people, technology, social business and good governance.

We will have to create new financial institutions if we are worried about income disparity and poverty. Social business can be the answer to the most pressing challenges.

According to Prof Yunus, “social business is selfless business to solve social problems” based on seven principles.

A social business has investors and owners. It is a cause-driven business where the investors/owners can gradually recoup the money invested, but cannot take any dividends beyond the invested amount. The social business must cover all costs and make profit, while at the same time achieving a social objective.

One can start in a small way. The power of social business is imbedded in the idea that private enterprises be driven by a social mission of changing lives for the better in a financially sustainable way rather than by private financial gain.

Financing social business can involve philanthropists, charity, corporate social responsibility (CSR), private investors, companies, foundations, NGOs and even city corporations, local governments and governments. Charities work for social development and welfare and do not have a profit making objective. Hence they are highly dependent on aid and external sources for survival and often do not generate sufficient fund to sustain their operations.

According to Prof Yunus, "A dollar in charity has one life; a dollar in social business can be invested over and over again."  But, yet charity is needed to address some categories of vulnerable issues, like people who suffer from extreme physical or mental disabilities, as well as the very old and the very young, because it is virtually impossible for them to support themselves.

CSR and social businesses can be linked, as a source of funding for creating and promoting self-less business ventures like social business.

Social business is a new category of business. It does not stipulate the end of the familiar profit-maximising business model. Rather, it widens the market by giving a new option to consumers, employees and entrepreneurs. Both the business models -- profit-making business and selfless business -- will coexist. The same person can be engaged in both kinds of business.

The meeting between Franck Riboud, chairman and chief executive officer of Groupe Danone, and Prof Yunus in October 2005 made way for the creation of a social business called Grameen Danone Foods Ltd in Bangladesh, the world's very first consciously designed multinational social business to promote nutrition for kids at an affordable price.

Grameen Green Children Eye Care Hospital is another good example. Tom and Milla, members of the music group Green Children, became so enthralled by the idea of social business that Milla contributed to the full cost of the first eye care hospital under Grameen Healthcare Services Ltd using funds from her own Green Children Foundation. Veolia, Intel, BASF, SK Dream and Uniqlo -- all these multinational corporations have their own stories to tell about Grameen social business.

Local companies such as Grameen Distribution Ltd and Grameen Fabrics and Fashions Ltd have also come a long way in addressing the need for affordable products for the poor by establishing a country-wide distribution and marketing network. Grameen has started touching the lives of the next generation of entrepreneurs and professionals through Grameen Caledonian College of Nursing, Japan Auto Mechanic Ltd, and students studying with Grameen Shikkha scholarships, Nobin Udoykta Program and building seeds under Social Business Learning and Innovation Fund.

Grameen Telecom Trust (GTT) is helping germination and build social business infrastructure in Bangladesh. The key operations are its investments in Grameen Danone Foods Ltd, Grameen Health Care Services Ltd, Grameen Distribution Ltd, Grameen Fabrics and Fashion Ltd and Grameen Poshra.

GTT has also pioneered Social Business Learning and Innovation Fund to encourage social business innovations partnering with NGOs and individual entrepreneurs. Successful and tested models can gradually be scaled up and replicated. GTT is also implementing Nobin Udyokta Program, an innovative scheme based on the theme “We should not be jobseekers, we should be job givers”. GTT's target groups include poor women, female students, physically challenged people, indigenous and marginalised communities. Nobin Udyokta is a new frontier of social business, for solving the problem of youth unemployment. Prof Yunus introduced this concept and implementation started in 2013.

The lesson that has been learnt from the operation of Nobin Udyokta Program with the children of Grameen Bank families in Bangladesh can be applied for other children in Bangladesh and elsewhere to turn the problem of unemployment into entrepreneurship following the same principles and using the same methodology.

Innovations and replications are going on in more than 30 countries and also social business learning centres are in operations in the universities in Bangladesh and abroad. Government-sponsored social business activities are going on in Haiti, Albania and Malaysia. Local governments and city corporations are involved in creating social business cities in Germany, Italy and so on.

Prof Yunus, who was born on June 28, 1940, always inspires people, especially the youth, to create a meaningful life by using their latent talents.

On his birthday, let us hope social business will inspire all to make positive changes for a sustainable world.

The writer is the managing director of Grameen Telecom Trust.