NextBillion - A WDI Publication

Small-scale Business Funding

Corporate social responsibility and NGO engagement comes in many shapes and sizes, but very few companies are still able to see the potential for profit in poverty. The traditional philanthropic model involves the allocation of grants through charitable foundations. And thank goodness it does, as these corporate grants make possible much of the work carried out by NGOs around the world to tackle poverty. However some companies are beginning to go one step further and to con...

Source

Ethical Corporation (link opens in a new window)

It’s Good Business, But a Strategy That Saves Lives As Well

’Corporate social responsibility often means leveraging the concern (or guilt) of the affluent on behalf of those less fortunate: Sell to First World consumers and redistribute some of the profits to address Third World problems. But a case has been made for a different strategy that involves selling to the poor themselves. In a speech last month, for instance, Harish Manwani, the chairman of Hindustan Lever Limited, pointed to his firm’s marketing Lifebuoy soap to India...

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The Boston Globe (link opens in a new window)

Microfinance Misses Its Mark

To understand why creating jobs, not offering microcredit, is the better solution to alleviating poverty, consider these two alternative scenarios: (1) A microfinancier lends $200 to each of 500 women so that each can buy a sewing machine and set up her own sewing microenterprise, or (2) a traditional financier lends $100,000 to one savvy entrepreneur and helps her set up a garment manufacturing business that employs 500 people. In the first case, the women must make enough money to pay o...

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Stanford Social Innovation Review (link opens in a new window)

Flaws in Measuring the World’s Poor May Hinder Solutions

But to some economists, the World Bank’s definition of poverty is flawed, arbitrary and tends toward suppressing the numbers. Sanjay Reddy, a Columbia University economist and longtime critic of the bank’s counts, says, If their dream is a world free of poverty, they ought to know how to measure it. Our dream is a world free of poverty is a slogan at the World Bank. One challenge facing Paul Wolfowitz’s replacement at the bank’s helm is how to count the wo...

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Wall Street Journal (link opens in a new window)

Big Corporations Try to Tap a Market They Have Ignored

The world’s biggest corporations are scrambling to tap a market they have largely ignored for decades - the world’s four billion poor people. From South Africa to Brazil, companies like Danone and Unilever sell individual packets of yogurt and soap in rural villages and urban open-air markets. In the telecommunications sector, the biggest growth area is among the poor, who are snapping up cellphones. Some 60 percent of the world’s population exists on less than ...

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Reuters (link opens in a new window)

Categories

Investing

Tags

corporations, global development, poverty alleviation

MFIs must increase range, volume of services

Micro Finance Institutions (MFIs) can play a vital role in bridging the gap between demand and supply of financial services if the critical challenges confronting them are addressed. The first challenge relates to sustainability. It has been reported that the MFI model is comparatively costlier in terms of delivery of financial services. An analysis of 36 leading MFIs by Jindal and Sharma shows that 89% of the MFIs sample were subsidy dependent and only 9% were able to cover more than...

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The Financial Express (link opens in a new window)

Micro-finance firms turn into delivery boys

India?s microfinance, which is perhaps the ruling flavour of private equity players, is actually turning out to be a distribution highway for a variety of goods and services given the huge outreach of over one million customers each that large entities like Share, SKS, Basix and Spandana have managed to create. Fuelled by private equity investment and expansion, many of these entities are looking at reaching as ma...

Source

The Economic Times (link opens in a new window)

Region

South Asia

Who in the world is entrepreneurial?

So what are the best countries for entrepreneurs now? Where might American entrepreneurs think about setting up overseas? And where should they keep an eye out for global competitors? Some of the stars - such as Iceland and Denmark - might surprise you. Laggards include India. When Rodrigo Veleso launched ONE World Enterprises in Los Angeles last year, he quickly grasped why entrepreneurship was surging in the U.S. Within a week I had formed an LLC, incorporated in Delawar...

Source

CNN Money (link opens in a new window)