Weekly Roundup 6-26-15 : Financial inclusion beyond gender currency, public health and e-cigs, and what you can learn from 12 years of scaling up
Editor’s note: Beginning this week, we will be doing a little remix of the weekly roundup. To start, we’re going to be publishing it on Fridays instead of Saturdays. Secondly, each week the entire NB team will be providing articles and mini-analyses from the world of social enterprise from a variety of angles – financial innovation, health and business development, to just name a few. This is a bit of a change; in recent years we’ve had one editor generally focus on a single sector each week. We realized this practice sometimes limited us in providing a complete picture of what you needed to know during the past seven days. We hope you enjoy the new format. And if you don’t, let us know.
It’s great that we’re putting historic women on our money – but will today’s women have anywhere to deposit it?
As you may have heard (it has become a bit of a thing on the Internet), the U.S. is planning to redesign the $10 bill, removing the face of Founding Father Alexander Hamilton, and replacing it with the face of a historic woman to be determined. It will be the first time in over a century that a woman will be featured on a U.S. bill, and the redesign will be released by 2020, in time for the 100th anniversary of the 19th amendment, which extended the right to vote to women.
The decision has inspired plenty of suggestions on which woman should be selected. (The current front-runner seems to be former slave, prominent abolitionist and Underground Railroad conductor Harriet Tubman – though Donald Trump’s mother may be a dark-horse contender.) This being America, it has also sparked furious criticism, with a campaign emerging to convince the government to reconsider and push the far less sympathetic Andrew Jackson off the $20 bill instead.
The debate has been entertaining, but when it comes to women and money, perhaps there’s a better focus for all this public interest: how to bring more women into the global financial system.
Over 1.1 billion women worldwide remain excluded from the formal financial system, with less than 8 percent in low-income countries having a loan – and less than one-third having a savings account – in formal institutions. The problem varies by region: In Africa, four out of five women lack access to a formal account, compared to one out of every four men. But even taking individual characteristics like income, education, employment and age into account, a financial inclusion gender gap persists in practically all the world’s economies.
While informal savings and lending approaches can (and do) help greatly, this exclusion from formal services takes a toll. For instance, though women own one third of small and medium enterprises (SMEs) – the top drivers of job creation in emerging markets – they receive just 6 percent of SME loans. And globally, women face a credit gap of $260-$320 billion in emerging markets. A parallel problem even threatens to prevent women from reaping the benefits of the mobile finance revolution: women are 21 percent less likely to own a mobile phone
than men – a number that increases to 23 percent in Africa, and 37 percent in South Asia, and that amounts to a 300 million-person global gender gap.
Closing this gap wouldn’t just empower women, it would benefit their families and communities. With studies showing that women invest up to 90 percent of their income in their families and communities, imagine the impact that access to finance could have.
On the plus side, the financial inclusion community is doing more than just imagining, as shown by several recent developments. This week, Innovations for Poverty Action announced a new $7.4 million Gates Foundation grant to support research on product design innovations that increase financial inclusion, with women being a primary focus. Next month, the Alliance of Financial Inclusion is organizing a conference with the theme of “Financial Inclusion Policy Solutions for Women in Africa.” And women’s use of financial services will be one theme of CGAP’s recently announced annual photo contest.
With the issue so clearly on the agenda of major players like the Gates Foundation, the World Bank and the Omidyar Network, it seems likely that by the time Alexander Hamilton cedes his place to a female luminary in 2020, a lot more women around the world will have access to a lot more $10 bills. That development would likely make Harriet Tubman – or even Donald Trump’s mother – smile.
Are they selling out or saving lives?
A rash of mergers and acquisitions in the pharmaceutical industry left many researchers looking for work. A lot of them ended up working for tobacco companies making e-cigarettes.
The jury’s still out on e-cigarettes: the World Health Organization dubious; some countries have banned them; there’s a lively debate about whether they can can help people stop smoking, as manufacturers claim.
But there’s no denying that non-communicable diseases like cancer disproportionately affect low- and middle-income countries, where smoking rates are increasing and where, according to the World Health Organization, “tobacco accounts for around 6 million deaths every year (including from the effects of exposure to secondhand smoke), and is projected to increase to 8 million by 2030.”
Reuters reported that more than 400 scientists and technical staff have joined Philip Morris International Inc. in Neuchatel, Switzerland, to help the refine the company’s e-cigarette offerings.
The stakes are high. If e-cigarettes are proven to be safe, manufacturers might escape the taxes and regulations imposed on real cigarettes, and reap a windfall.
The stakes are high, too, for scientists who don’t want to be remembered as Big Tobacco enablers.
Gizelle Baker, a biostatistician for Philip Morris in Neuchatel who previously worked at the cancer drug developer Poniard Pharmaceuticals, described the upside for Reuters: “We were looking at drugs that make people very ill and maybe extend their life by 12 to 14 weeks. If you have a product that prevents cancer in the first place you can have a much bigger impact on public health.”
Victor DeNoble, an experimental psychologist and former Philip Morris employee, described the downside: “The tobacco industry now says ’We made mistakes and we want to correct them, and that’s why we want you to join us.’ The lure is still public health. But I’m older and wiser and I can’t trust an industry that has repeatedly broken its promises.”
There’s plenty of risk to go around, with those who choose to smoke cigarettes – “e” or otherwise – at the epicenter.
The GBSI Method
Yes, there are a lot of white papers and research report about what you should be doing to run or work for a social enterprise success story in the making. But rarely do those white papers reflect on 360-plus businesses over the span of a decade.
Santa Clara University’s Miller Center for Social Entrepreneurship this week published just such a paper, “The GSBI(R) Methodology for Social Entrepreneurship.” The whitepaper is informed by 12 years of work by the Global Social Benefit Institute, whose mission is to get early stage enterprises ready for investments and reach or deal with the challenges of scale. There have been many successes, and several failures, in that time. Depending on where they are in their business maturation, business leaders in the cohort attend three days intensive training, participate in a six-month online-only program for early-stage developing ventures; or join the 10-month GSBI Accelerator.
“We have applied this stage-appropriate methodology in over 60 countries,” said Pamela Roussos, senior director of GSBI. “What sets us apart is our 80-plus Silicon Valley executive mentors who accompany the social entrepreneurs on their journey through weekly meetings for entire duration of their program.
“More than 85 percent of our last cohort received funding. Our methodology contributes to this success record and we would like others to benefit from it.”
The paper is also in response to the proliferation of incubators and accelerators and assembles tips on avoiding common entrepreneurial pitfalls, like failing to prep for a pre-investment due diligence process.
Links of interest from the NB Team this week:
Impact investment must not become the tail that wags the dog by Pioneer’s Post