The Daily Star: Create framework for social business
Nobel laureate Muhammad Yunus, left, speaks at a workshop on social business in Dhaka yesterday. Photo: STAR
Grameen Bank founder Professor Muhammad Yunus yesterday highlighted the need for a set of new institutions and regulations, including a separate stock market, to fit his social business concept.
“There should be a new stock market for social business ventures in future when the number of such business rises,” Nobel laureate Yunus said at a workshop in Dhaka.
Social business is a concept of doing business without owners taking out any dividend, but investors get back their initial investment. The company’s profits are retained for expansion and improvement of the country unless the beneficiaries are the poor.
He explained the role of over 30 companies, set up by Grameen initiatives, whose main objective is maximising benefits for the poor and not that of profit maximisation.
At the workshop, he talked about new regulations, separate rating agencies and academic courses to regulate and train people on social business, which he believes could help alleviate poverty.
A US university will begin academic courses on social business to involve and train people, said Yunus at the workshop organised by Bangladesh Enterprise Institute (BEI) under the Bangladesh Social Enterprise Project in cooperation with Australia-based Foundation for Development Cooperation (FDC) and UK-based Libra Advisory Group.
Yunus was speaking as chief guest and keynote speaker on the first day of the workshop, which aims to utilise the key strengths of the private sector, to address some poverty-related issues in the country.
He said rating agencies would rate a social business venture’s contribution to poverty alleviation and catch profit maximising ventures disguised as social business.
Advocating social business, he said, “When you invest $ 1 in charity it never comes back but when the money is invested in social business, it comes back and creates new money.”
“That is why investing in social business is more powerful,” he said.
He said Grameen is now consulting various overseas and multinational companies to initiate new social business ventures.
Some areas where the Grameen family has social business projects include nutrition, healthcare, pure drinking water and eye care.
Yunus said since July, Grameen Veolia Water Ltd has been providing pure drinking water to inhabitants of the arsenic contaminated Goalmari village in Daudkandi, Comilla, by selling three litres of drinking water at only Tk 1.
BEI President Farooq Sobhan, who chaired the function, said after pioneering microcredit, Bangladesh would also be able to pioneer social entrepreneurship.
Lamiya Morshed, executive director of Yunus Centre, said Social MBA courses, Social Stock Exchange, Social Impact Indicators, SB Ratings and Journals and SB Regulations will be required in future for smooth running of such business.
Peter Wilson, senior adviser of Libra Advisory Group, and Craig Wilson, executive director of FDC, were also present at the function.30 july, 2009