Germany proposes Microcredit fund for Africa

Now it's getting interesting: I feel that this story has the potential to bring together my interest areas Microfinance and Social Entrepreneurship with my German background plus my plan to go to Africa at the end of this year! Does anyone have contacts to the right people? :)

The Financial Times writes: "Germany is to press other Group of Eight industrial nations to create a micro-credit fund for African entrepreneurs as part of efforts to promote investment in the continent, according to Germany’s development minister. Heidemarie Wieczorek-Zeul said the fund, which could be managed by the World Bank, would be a 'positive signal' to the poorest people in African countries, who 'often miss out on the effects of investment'."

Read the full Financial Times article.
Another interesting microcredit article: Value change next to money.

Yunus on "Social Business Enterprise"

I have been following closely Nobel Peace Prize winner Muhammad Yunus, "the father of microcredit". He combines business approaches with social goals... therefore I am superinterested in his new idea: it's called "social business enterprise". First step is a yogurt factory in Bangladesh, the Fortune magazine reports...

What if, by raising "social capital" and investing it in sustainable businesses without a profit motive, companies could reach into new markets, expanding their core businesses at the same time they improved lives? That's the world Yunus envisages. " It could be a very big idea," says a fellow Nobel laureate, the economist Joseph Stiglitz, who has been hearing Yunus talk about his new endeavor for years. The question, he says, is how to implement it. Read the Fortune magazine article.

Business and the Global Poor: "The Bottom of the Pyramid"

With interest I have been following the discussion on "the Bottom of the Pyramid" (BOP) which means the 4 billion people poor who live on less than 2-5$ disposable income per day. There is an interesting overlap with Corporate Social Responsibility, Social Entrepreneurship and Microfinance because all these concepts somehow link "business" with "social".

Although the definitions vary the idea behind the BOP discussions is clear: "How the global poor can become producers as well as consumers?" and "how can poverty can be alleviated by business activity?". Ideally, this would be a win-win situation for business (new markets, new customers, growth) and the poor (affordable products, employment, income). Simple examples include shampoo that works best with cold water or soap in very small sizes affordable for the poor - both even improve health by reducing diseases.

Here a good article from the Harvard Business School.
And the BOP "bible": The Fortune at the Bottom of the Pyramid

Social Entrepreneurship

Since I heard Yunus' Nobel lecture proclaiming "social businesses" and an information session of Acumen Fund social entrepreneurship won back my attention.

What's a social entrepreneurship?

"The art of simultaneously pursuing both a financial and a social return on investment (the double bottom line)."
The Institute for Social Entrepreneur

Here a nice example: "In Africa, where children die of diarrhea from bad sanitation, Isaac Durojaiye runs a franchise system for public toilets. He supplies mobile toilets to slum areas, where unemployed young people charge a small fee for their use. The operators keep 60 percent of the income and pass the rest back to Mr. Durojaiye’s company, Dignified Mobile Toilets, which uses the money to buy new toilets." Read the full New York Times article.

I would like to learn more about the crossroads between Corporate Social Responsibility and Social Entrepreneurship because both want to have a positive social impact including poverty alleviation. Any thoughts?

UN report ends doubt that Humans responsible for Climate Change

A brand new UN report found a 90 percent probability that man-made greenhouse gases were responsible for the increase in the Earth's surface temperature over the last half century. Something that most Europeans have believed for a long time but has been still doubted in the USA. Wake up time, Mr. B?!

The report is compiled by the UN International Panel on Climate Change (IPCC), an independent body composed of the world's top climate scientists. It says that "extreme and violent weather will be the norm by 2100", scary... The UN Environment Programme (UNEP) adds: "The pace at which finite natural resources are being lost could mean that the engine of globalisation may stutter and eventually run out of fuel, triggering potential tensions between nations and aggravating, rather than alleviating, poverty".

The Picture shows the disappearing glacier of Mt. Kilimanjaro in Tanzania (courtesy of Spiegel). The top photo shows the peak in February 1993. The bottom picture is from February 2000. People on the bottom of the mountain rely on the water of the glacier, i.e. poor people are going die due to droughts.

More Photos on Climate Change: Spiegel
A good summary of the report: UN News Centre
Take action! Here a good blog on Cimate Change Actions!

What is the UN Global Compact?

With over 3000 participants in over 100 countries the Global Compact (GC) is now the largest voluntary Corporate Citizenship initiative in the world. Corporate Citizenship is a more "UN-formal" expression for Corporate Social Responsibility (CSR) and closely related to Sustainable Development. The idea was born by Kofi Annan with the vision of a "more sustainable and inclusive global economy", and recently re-endorsed by Ban Ki-Moon.

"Let us choose to unite the power of markets with the authority of universal ideals. Let us choose to reconcile the creative forces of private entrepreneurship with the needs of the disadvantaged and the requirements of future generations".
Kofi Annan

The GC has two objectives: 1) Make the 10 principles part of business strategy, operations and culture everywhere and 2) Facilitate partnerships toward UN goals such as the MDGs. It is a multi-stakeholder initiative including prticipants from business, civil society (NGOs), governments / UN and labour. At the heart of the GC are 10 universal principles in the areas of:

• Human Rights
• Labour Conditions
• Environment
• Anti-Corruption

The GC participants range from Coca Cola, Microsoft to SME in developing countries, through all sectors and countries. The GC has local networks around the world and is managed out of the Global Compact Office in the UNHQ. Soon I am going to write what I exactly do there...

This PowerPoint file gives a good overview: Global Compact Presentation

Ban Ki-Moon: "The UN and business need each other - UN Global Compact at center."

Last week the new head of the UN Ban Ki-Moon delivered an important speech for the Global Compact where he commited to carry forward the initiative which got started 7 years ago by Kofi Annan.

In his first speech outside of the United Nations as Secretary-General Ban Ki-moon said the global business community and the United Nations share many of the same goals, such as supporting strong economies and giving people the opportunity to make a living. Although the business world tends to focus on profit while the UN aims more for peace, better health and human rights, "the United Nations and business need each other," Ban told the Business Council for the United Nations and the Association for a Better New York.

"At the center of the Organization's engagement with business is the United Nations Global Compact. It brings together government, business, labour and civil society – both globally and locally based on the conviction that business practices rooted in universal values can help bring social and economic gains".
-- UN Secretary-General Ban Ki-Moon, January 2007

Ban stressed that business, trade and investment are "essential pillars of peace and prosperity" , and confirmed that the United Nations must engage more fully with non-state actors in order to bring about a prosperous, more secure and peaceful world.

Link to Official Speech Transcript
Article in the The Guardian (London)

2007 will be the warmest year ever

According to experts, it's likely that 2007 will exceed the current record from 1998 and therefore will be the warmest year ever tracked since temperature is measured since 1851.

The Stern Review on the economics of climate change states that all countries will be affected by climate change, but it is the poorest countries that will suffer earliest and most. Or is it not? According to the Financial Times, Australia is experiencing the effects of global warming more deeply than other parts of the world.

Have a look at Climate Change in depth.

Credits to Max Oliva from Instituto de Empresa Business School.

Quote of Ghandi on Change

After it jumped several times into my eye now, I thought it's worth sharing with you:
"You should be the change that you want to see in the world."
Mahatma Gandhi

The Economist on the United Nations

I read The Economist's for a few years now but the new issue of this week with a cover story about the United Nations is one of the most interesting ever.

That the magazine's editors chose not to tag a question mark at the end of the cover headline, "A Chance for a Safer World," tells you precisely where the package is going. Two of the special report's articles can be accessed for free, but the rest of the content is behind a subscription wall.

"And although the [US] is often the UN's harshest critic, it has come again to see the point of turning to the UN for help with problems - be they keeping the peace in Lebanon or saving lives in Darfur - it finds hard to solve alone." ... "[T]he permanent five could make the world safer and more orderly by showing a greater willingness to work together using the existing structure...All the big powers ought to see the benefit of making better use of the potential for joint, lawful international action that the UN uniquely provides."

Article partly taken from Mark Leon Goldberg from UN Dispatch.