One of the most exciting announcements at the Skoll World Forum was revealed during the opening plenary: BRAC and MasterCard Foundation announced a $45 million partnership, created to scale BRAC’s innovative microfinance multiplied model in Uganda (more about the partnership here).
BRAC’s Susan Davis and Rumee Ali were intimately involved in the development of this partnership. Susan Davis is a founder and the current president and CEO of BRAC USA. Her role is to introduce BRAC’s innovative development approach to improving the health, wealth, and well being to the poorest women—and their families—in Africa and Asia. Rumee Ali is the managing director of Enterprises and Investments at BRAC and chairman at BRAC Bank Limited, Dhaka. Rumee is responsible for overseeing the social entrepreneurial activities of BRAC. He gave a fantastic overview of the current state of social entrepreneurship.
When I asked them if they see a potential conflict between financial and social goals, Rumee replied that in creating value within an organization, you have to consider environmental and social objectives and that there is constantly a need to balance social and business goals. In particular, he said, it is essential to ensure that investments and social entrepreneurship begin with interventions and that they are sustainable. He also suggested that it is necessary for social enterprises to generate surplus, create jobs, and sell investments. He contended that microfinance is not the only solution and that education is essential for determining the best activity in any given situation.
I also asked them what they saw as the current state of social entrepreneurship. Rumee argued that the current state of organizations is such that there are philanthropic, altruistic foundations on the one hand and exploitative, selfish companies on the other. In the middle of this spectrum, he suggested, sat CSR organizations. There is increasing pressure for both philanthropic and exploitative organizations to move closer towards the center. Rumee suggested that there was a movement to a point of convergence between these different types of organizations.
Finally, I asked about opportunities for social entrepreneurship in the future. Rumee suggested that BRAC faces the challenge of standardizing their work and giving the opportunity to more social entrepreneurs to gain access to markets. BRAC has a strategy to create jobs, which is both efficient and has a positive social impact. The aim of the BRAC bank is to make investments with a purpose and to facilitate access to capital and the opportunity of incubating social businesses. The bank encourages a democratization of the banking system to allow more people in. Rumee drew a comparison between this process and the current situation in the Middle East where people have begun to say, “I need to be a part of this.” This led to pressure for a system that benefits all, not just a few. Through developing an ecosystem, everyone can have a role.
Check back this Friday to read about my interview with John Marks, president and founder of Search for Common Ground, a nonprofit conflict-resolution organization with offices in 23 countries.