Weekly Roundup – The Pope Pulls No Punches: Controversial encyclical puts spotlight on BoP and reboots debate
“The BoP Pope” (as we’ll call him) was at it again this week, issuing what pundits are calling the most controversial papal document in a half century.
Long an opponent of capitalism that “rules rather than serves,” the encyclical Pope Francis issued Thursday to his 1.2 billion-member flock offered a call to conscience for those in power.
He believes the reckless pursuit of profits, “power politics” and dependence on technology have imperiled the planet – it’s now an “immense pile of filth,” says the pope – and worsened the plight of the poor.
He touched some nerves, to be sure. Matthew Schmitz said the pope wants to roll back progress. Diana Furchtgott-Roth said his plan will backfire and ultimately be bad for those at the BoP. Paul B. Farrell said the pope’s launching an anti-capitalist revolution.
At the end of the day, what he did was shine a spotlight on economic inequality. And, as the world’s fourth most powerful person, it’s an incredibly bright spotlight.
The planet is in need of solutions. The encyclical might well help speed up the search for those solutions. While the pope is pessimistic that the free market can bring about long-term positive changes, many others believe the free market, while flawed, remains the one best way to make the planet healthier and happier.
Let the debate continue.
Aavishkaar rising – with a big raise
Aavishkaar Venture Management, one of India’s first impact investment funds, announced it has closed its $45 million Aavishkaar Frontier Fund.
As reported in VC Circle, “Aavishkaar said it will invest in 15-18 companies with a ticket size of around $1-5 million each in countries like Indonesia, Bangladesh, Sri Lanka and Pakistan. It will chase investments in affordable healthcare & education, water & sanitation, food & agriculture services, energy, technology for development, technology for development and livelihoods.”
Founder Vineet Rai indicated that the new fund will help give those countries a push toward a more vibrant impact investing market – similar to what India is experiencing today.
“The impact investing ecosystem in all these emerging economies is at a nascent stage similar to India a decade ago, when Aavishkaar started its pioneering work investing in rural enterprises in India. This is an important step for Aavishkaar to take its investment and ecosystem building approach beyond India, to its neighbours,” he told VC Circle.
This brings Aavishkaar’s assets under management to $200 million. It’s taken about 14 years for Rai to get here since founding Aavishkaar, but clearly his ambition is to make the BoP-business backer a regional player – in one of the world’s most populous regions. If there are larger venture funds focused on pro-poor businesses, we’re not aware of them.
Trans fat to go transnational?
The U.S. government ruled Tuesday that the food additive trans fat isn’t safe and gave manufacturers and restaurants three years to stop using it.
Trans fat makes food taste good and last longer, but it’s been found to cause heart disease, so the announcement was a win for health proponents in the U.S.
It could be net loss globally, however, according to Lawrence Gostin, an expert on national and global health law at Georgetown University in Washington, D.C. He thinks the food industry will respond by simply increasing the sale of trans fat-laden foods in developing countries.
“The question … is whether they then dump their unhealthy, trans fatty acid products on to poorer countries around the world with less robust regulatory systems,” he told Voice of America. “And I just think that’s unethical but expected.”
He calls for an international revolution to make the food supply safer and healthier. “This is a silent epidemic,” he says. “It’s no less an epidemic than AIDS, tuberculosis, malaria or any of these major outbreaks.”
An “international revolution” might be hyperbole, but there’s no doubt the global population is getting fatter and the ethics of food manufacturers will play a role in whether that expansion continues.
Popping the charity balloon?
“What the world needs now is not more charities.”
That was the intriguing headline on a Monday story in the Vancouver Sun written by – in an interesting twist – two charity founders, Marc and Craig Kielburger.
The brothers’ point is that the number of nonprofits in North America is ballooning to the point that the organizations are becoming far too competitive and inefficient.
They point to Ken Stern’s book, “With Charity for All,” which says that in the early 1950s, there were 50,000 charities in the U.S. Today, according to the Kielburger brothers, more than 50,000 new American charities pop up each year. More than 700 charities in the U.S. specifically target breast cancer alone. Canada has 88,000 registered charities, or one for every 375 Canadians.
Rather than starting your own charity, the Kielburgers suggest, why not see if an organization is already working on your favorite cause, and support them, or encourage them to start a new branch? Or be like billionaire Warren Buffett, who gives the bulk of his billions to the Bill and Melinda Gates Foundation, and has said he’s satisfied with the compound effect that money has in the world.
The Kielburgers say not enough people and organizations are willing to put their self interest on the sidelines, and that prevents them from working together.
It’s an interesting take, and one that’s supported, at least tangentially, by controversial author Peter Singer and the “effective altruism” movement. Adherents believe it’s effective for smart young people to forego jobs in the relatively low-paying but “people rich” charitable sector, and instead get higher-paying jobs in another sector and contribute money to worthy causes.
It feels a little cold and distant, perhaps, but helps prove the theory that there is no shortage of ways to help the planet for those who have that goal.
Kyle Poplin is the editor of NextBillion Health Care.
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