Is Social Business a Remedy for a Poverty-Free Society?


It was a dusky evening of November, 2010 when I met Bangladeshi Nobel Laureate Professor Muhammad Yunus in his Grameen tower office. The date and time were fixed before I left Guwahati (a northeast Indian city) for Dhaka and it was my fourth meeting with the revolutionary banker to the poor. So our interaction started with no such preface. And we went into the content straight. It was Ramadan (Ramjan) month and Prof Yunus was fasting. He offered me a cup of tea and some biscuits.

I carried a traditional Assamese towel (Gamocha), which is recognized as the highest honour and love from an Assamese, for him. At the end of our long conversation Prof Yunus gave me a copy of his latest book ‘Building Social Business’ with his signature. And definitely it added more colours to my Dhaka trip. Shockingly, I started getting all disappointing news from the Bangladesh capital there after.

In fact, the end of 2010 and the first half of 2011 brought all bad news related to the economist turned visionary banker. Prof Yunus was finally compelled to leave Grameen Bank of Bangladesh, the institution he formed in 1983 and shared the Nobel Peace Prize with in 2006. Political analysts believe that the self-grown enmity by the Bangladesh Prime Minister Sheikh Hasina resulted in the vindictive behavior towards him. Though Prof Yunus was ousted as the managing director of Grameen Bank arguing him as over-age, the creator of micro-finance banking remains the policy maker of many Grameen sister concerns devoting on various initiatives like drinking water, yogurt for malnourished children, cell phones, solar power for rural homes etc.

Moreover, his spirit was not diminished with the attitude of the Bangladesh authority and continues working for his mission to make the world poverty-free. And the futurist social scientist is now preaching for a different kind of economic enterprise that emphasizes on social development and not the profit for the investors. Prof Yunus terms it as Social Business, a form of business that seeks to solve social problems. And his latest book describes all about ‘the new kind of capitalism that serves humanity’s most pressing needs’.

The book narrates about a new kind of capitalism and enterprise based on the selflessness of people which Prof Yunus calls social business. It’s a kind of business dedicated to solving social, economic and environmental problems that have long plagued humankind- hunger, homelessness, disease, pollution, ignorance, argues Prof Yunus.

Actually the social business is a new category of cause-driven business. In a social business, the investors/owners can gradually recoup the money invested, but cannot take any dividend (profit) beyond that point. Purpose of the investment is purely to achieve one or more social objectives through the operation of the company, and 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, elaborated Prof Yunus.

The man, who has shown the way of a dignified life for millions of Bangladeshi poor women through micro-finance, argues that the present concept of entrepreneurship is one-dimensional-to maximize profits. By defining entrepreneur in a broader way, one can change the character of capitalism radically and solve many of the unresolved social and economic problems within the scope of the free market. He at the same time pointed out, if profit and greed are the sole driving force in modern society then why we should have churches, mosques, temples, schools, art museums, public parks or community healthcare centres and why would there be any charities, foundations, non-profit organizations? 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. Of course, he believes that charity is essential in some cases when the people have to depend on charity, because it is virtually impossible for them to support themselves. “I am thinking of people who suffer from extreme physical or mental disabilities, as well as the very old and the very young. As a society, we simply owe these people our help, and it would be cruel to insist that they should support themselves. So there is room in our world for charity, just as there is room foe social business,” Prof Yunus analyzed in the book. Otherwise, he has some reservation on charity and typical corporate social responsibility initiatives. Arguing that there is nothing wrong with donation, charity and traditional CSR, Prof Yunus claims these have a one-time effect only.

The society or the poor would have to wait to get the same benefit until the donors do the same again, which completely depends on their intention. On the other hand, he analyses, if the people get everything free because donations pours in from the international community, we are not building the economy in the under-developed countries. Moreover, life cannot go on in a charity mode all the time. Explaining about the prediction of a future world, Prof Yunus pointed out that there may be two ways to go about it. One would be to invite the best scientific, technical, and economic analysts in the world to make their smartest twenty year projections. Another would be to ask the world’s most brilliant science-fiction writers to imagine the world of 2030.

“If you ask me who has the best chance of coming closer to the reality of 2030, without posing for a second, I would say that the science-fiction writers would be far closer than the expert analysts. The reason is very simple. Experts are trained to make forecasts on the basis of the past and the present, but events in the real world are driven by the dreams of people,” Prof Yunus narrates adding, “Do our dreams sound impossible? If they do, that means they are likely to come true if we believe in them and work for them… If you are wiling to share these dreams with me- and to join the people around the world who are already beginning to transform their dreams into reality through social business- let’s undertake this exciting journey together.”

Tanveer Jafri is an award-winning journalist and peace activist, based in India, covering communal harmony and social activities.