Using Business Wisdom For Social Compassion

This weblog has written posts on change-agent organizations or non-profits using fundamental business practices to increase their economic viability. When it does, it very often gets its ideas from The Entrepreneurial Mind, which wrote another article in this vein on 6/4/08, Business Turns Profits into Charity.

MyBusiness magazine (from NFIB) has a feature written by Emily McMackin on a for profit social venture called Giving Tree ....

... which sells the GiveCard---a prepaid Visa or MasterCard that allows recipients to donate 10 percent of their gift to the charity of their choice---Nicholas and cofounder Jeff Jacobs discovered that consumers were eager to give back.

McMackin interview me (Jeff Cornwall) for the story and was curious about the growing trend of more for profit social ventures.

Young entrepreneurs today are taking this tradition a step further by forming businesses to tackle specific problems in society, says Jeff Cornwall, director of the Belmont University Center for Entrepreneurship in Nashville, Tenn.

Without the IRS constraints that nonprofits have or the need to beg donors for money, these social entrepreneurs are finding more freedom to bring about change. Rather than trusting in these large institutions they don't think are effective, they're going out and solving problems at a grassroots level, Cornwall says. Given the interest we are seeing in students wanting to learn about social entrepreneurship, this is a trend that is likely to continue.

The New York Times ran a story on the same subject, social-entrepreneurship. This time though the focus was on Internet technology. When Tech Innovation Has a Social Mission - New York Times April 13, 2008.

diigo tags: innovation, web2.0, technology

Now a new style of “hybrid” technology organization is emerging that is trying to define a path between the nonprofit world and traditional for-profit ventures.They're often referred to as “social enterprises” because they pursue social missions instead of profits. But unlike most nonprofit groups, these organizations generate a sustainable source of revenue and do not rely on philanthropy.

Revenue is life blood for an economically viable entity, whether it is a corporate business, a entrepreneurial artisan or a social-entrepreneur. Revenue usually derives from some form of value added or productivity enhancement, though who provides the revenue and who benefits from the value-added may not always be the same.

Brewster Kahle, who has founded a number of successful Internet companies, as well as the nonprofit Internet Archive, said: “If we do this right, I think there is momentum here. The next major operating systems company might be a nonprofit.”

Mr. Kahle says he is developing a set of principles that he hopes will help formalize his idea that there is a middle ground between the technologists and the capitalists. He ticks off operating guidelines like transparency, staying out of debt, giving away information and refusing to hoard.

TechSoup distributes products from 32 commercial companies, including Cisco Systems, Microsoft and Symantec, to roughly 50,000 organizations annually, for a small administrative fee.

“We were just trying to meet the needs of nonprofits,” said Rebecca Masisak, co-chief executive of TechSoup.

“Computer technology and the Internet are lowering the cost of doing business,” said John Lilly, the chief executive of Mozilla, the Web browser developer that is being subsidized by advertising revenue from the search engine business.

The Killing Of Africa Through Good Intentions Or Not So Good Intentions?

One of the broadest and most devastating economic issues currently is the food crisis. Not losing sight of the seriousness of the topic, it is still a source of debate between economic philosophies. Capitalist-oriented publications such as the Economist or the Financial Times weigh in on their perspective. FT.com The Economists’ Forum Food crisis is a chance to reform global agriculture. I will confess to basically following this philosophical perspective with perhaps a more liberal take on the issues. Liberal though can be a negative label from both ends of the economic/political continuum.

diigo tags: economics, poverty

Of the two crises disturbing the world economy – financial disarray and soaring food prices – the latter is the more disturbing. In many developing countries, the poorest quartile of consumers spends close to three-quarters of its income on food. Inevitably, high prices threaten unrest at best and mass starvation at worst.

There is immediately though an undeniable point where the philosophical debates have to cease and we are dealing with real people. That point is exemplified by Africa and how the world will assist in its development. How effective we are going to be though will depend in large part on which philosophy we follow. This weblog has featured a number of articles from TED, MIT and other organizations on their efforts in Africa and other developing third world countries through social-entrepreneurship, again following a free enterprise approach to these issues.

Here are two views of what is wrong with what we are doing in Africa, but they come from two very different perspectives. One is European and supposedly neo-liberal and other African and anti-colonial. My initial reaction is that I am not comfortable with either one of them but see valid points with both. Further education in this topic might move me one way or the other, but it will have to be in the opposite direction of one of them or it will have to be a middle path of some type.

Opinion: Developmental Aid Workers Are Killing Africa - International - SPIEGEL ONLINE - News

diigo tags: spiegel, economics

If you follow the reasoning of the United Nation's World Food Program, then Kenya is a unique region when it comes to hunger catastrophes. In this east African country, a popular vacation destination with 32 million inhabitants, UN workers hand out more food on an annual basis than they do in southern Sudan, which civil wars have ravaged for decades. But is Kenya really dying of hunger?

How Europe underdevelops Africa and how some fight back from Pambazuka News

From above, many African elites have succumbed to what Olukoshi terms trade-balkanisation, following the lead set by colonial pigs in the 1884-85 Berlin conference that so irrationally carved up the continent. Since 2002, the EPAs have supplanted the agenda of the gridlocked World Trade Organisation, just as bilateral trade deals with the US, China and Brazil are also now commonplace.

A united Europe deals with individual African countries in an especially pernicious way, because aside from free trade in goods, Mandelson last October hinted at other invasive EPA conditions that will decimate national sovereignty: “Our objective remains to conclude comprehensive, full economic partnership agreements. These agreements have a WTO-compatible goods agreement at their core, but also cover other issues.”

Those other “Singapore” issues (named after the site of a 1996 WTO summit) include investment protection (so future policies don’t hamper corporate profits), competition policy (to break local large firms up) and government procurement (to end programmes like South Africa’s affirmative action). These were removed from the WTO by African negotiators during the Cancun summit in 2003, but have re-emerged through EPA bilaterals.

Now LA Times Recognizes That Africa's Anti-malaria Campaign Is Showing Results

Africa's anti-malaria campaign showing results
--------------------

Infection rates drop as nations take action against the disease. In Tanzania, Bush announces a venture to provide enough mosquito nets to protect every child between the ages of 1 and 5.

By James Gerstenzang
Los Angeles Times Staff Writer February 19 2008

BWEFUM, ZANZIBAR;-- Like clockwork, particularly on Mondays after his office had been closed for the weekend, the patients would line the concrete benches outside Mininyi Othman's tiny health center 10 miles from the nearest paved road.

It is good to read in the Los Angeles Times that malaria is finally diminishing its deadly impact in Africa and hearing that our President is committed to providing "mosquito nets to protect every child between the ages of 1 and 5", is inspiring, but the article does very little to tell us how we got to this stage. Not to be overly skeptical, but are we to believe that George W. Bush is a significant savior of Africa?

The Los Angeles Times article "Unintended Victims of Gates Foundation", which was the primary focus of the Best Intentions Unintended Consequences post, was the second most popular item link of this weblog so far. What are the key health dangers for children?, has been the most popular. The previous LA Times article provided an indepth analysis of failure. An equally indepth analysis of success would be appreciated.

Best Intentions Unintended Consequences

The Los Angeles Times had an article that called into question whether the Gates Foundation was having a net positive impact on healthcare in Africa.

Unintended victims of Gates Foundation generosity - Los Angeles Times

The Gates Foundation, endowed by the personal fortunes of the Microsoft Corp. chairman, his wife and Berkshire Hathaway Inc. Chairman Warren E. Buffett, has given $650 million to the Global Fund. But the oxygen valve fell outside the priorities of the fund's grants to Lesotho. Every day, nurses say, one or two babies at the hospital die as Mankuebe did -- bypassed in a place where AIDS overshadows other concerns.

Mixed effects

The Gates Foundation has targeted AIDS, TB and malaria because of their devastating health and economic effects in sub-Saharan Africa. But a Times investigation has found that programs the foundation has funded, including those of the Global Fund and the GAVI Alliance, which finances vaccines, have had mixed influences on key measures of societal health:

* By pouring most contributions into the fight against such high-profile killers as AIDS, Gates grantees have increased the demand for specially trained, higher-paid clinicians, diverting staff from basic care. The resulting staff shortages have abandoned many children of AIDS survivors to more common killers: birth sepsis, diarrhea and asphyxia.

The article provided the impetus to go back and look again at the Vivian Hoffman paper. The paper raised questions about the real impact of social-entrepreneurs, such as the Acumen Fund, had on helping the poor. The post links to a Marginal Revolution post and from there to a New York Times article that questioned whether direct distribution of the nets of the nets was best or were social entrepreneurial programs. Similar questions of effectiveness arose from the the Fast Company article regarding Grameen Phone Company.

The Bill & Melinda Gates Foundation supported Global Fund seems to see this either as a public relations problem, if we want to be cynical, or as a problem of self-definition, they can't be all things to all people or perhaps something in the middle. There does seem to be some truth to the later proposition that they can't be all things to all people but it is arguably a matter of balance. Because it's Bill Gates cynicism seems far easier than it might otherwise.

The LA Times did do a follow up report on the Global Funds dispute with their article. The Global Fund not only has their own piece criticizing the LA Times article, they also have a letter from the National Aids Control Commission of Rwanda.

I have an issue with attempts to find fault to create a story, which the LA Times article and the Fast Company article seem to lean too much towards in my view. The New York Times article and Vivian Hoffman paper though seemed different. My second reading of the Hoffman paper did provide a better understanding and impressed upon me again the uncomfortable perspective that going in with a decidedly social-entrepreneurial slant as the best intentions to provide assistance without fully understanding the culture could have unintended but detrimental consequences. What I don't know is what course of action, if any, have been taken by the social-entrepreneurs to address these issues. This is not, of course, the same as arguing that traditional government centered policies are automatically better.

Within the LA Times article they make a statement which is apparently in conflict with what I got from the Hoffman article.

According to UNICEF, malaria kills relatively few children. Birth-related problems, pneumonia and diarrhea are the top causes of child mortality. All are treatable but occur at high rates, in part because resources are concentrated on AIDS, TB and malaria, The Times reported.

This is in contrast to the Vivian Hoffman paper,

Malaria kills over one million people annually, 90 percent of them children under the age of five (World Health Organization, 2004).

What I found at the WHO website, which provided more insight, is that the key health dangers for children are:

• From one month to five years of age, the main causes of death are pneumonia, diarrhoea, malaria, measles and HIV. Malnutrition contributes to more than half of deaths.

• Pneumonia is the prime cause of death in children under five years of age. Nearly three-quarters of all cases occur in just 15 countries. Addressing the major risk factors – including malnutrition and air pollution – is essential to preventing pneumonia, as is vaccination. Antibiotics and oxygen are vital tools for effectively managing the illness.

• Diarrhoeal diseases are a leading cause of sickness and death among children in developing countries. Treatment with Oral Rehydration Salts (ORS) combined with zinc supplements is safe, cost-effective, and saves lives.

• One African child dies every 30 seconds from malaria. Insecticide-treated nets prevent transmission and increase child survival.

• Over 90% of children with HIV are infected through mother-to-child transmission, which can be prevented with antiretrovirals, as well as safer delivery and feeding practices.

• About 20 million children under five worldwide are severely malnourished, which leaves them more vulnerable to illness and early death.

  About two-thirds of child deaths are preventable through practical, low-cost interventions. WHO is improving child health by helping countries to deliver integrated, effective care in a continuum - starting with a healthy pregnancy for the mother, through birth and care up to five years of age. Investing in strong health systems is key to delivering this preventive care.

This does argue for taking a more comprehensive approach to children's healthcare in developing countries but it does not argue that it is being caused by “in part because resources are concentrated on AIDS, TB and malaria, The Times reported.” Amy Smith of MIT, who is recognized for finding low tech solutions for global problems informed us that smoke from indoor cooking was the number one killer of young children.

Meanwhile, Acumen Fund has been recognized by Fast Company as one of its top 45 Social Capitalists: Acumen Fund.

The increasing gap between rich and poor is one of the greatest challenges of our generation. Half the world lives on less than three dollars a day while 250 individuals hold more wealth than the bottom two billion. Creating a sustainable world means reducing that gap.

Aid alone will not end poverty. Traditional charity often meets immediate needs but is not designed to enable people to solve problems over the long term. Poor people seek dignity, not dependence.

Acumen Fund identifies and supports enterprises that provide health, water, housing and energy to the poor. We bring capital, knowledge and talent to accelerate markets for the poor, having seen their power as customers who are willing to pay for affordable, quality services that can change their lives. We have seen this working with our portfolio enterprise in South Asia and Eastern Africa.

While Iqbal Quadir has become the head of the Legatum Center for Development and Entrepreneurship at MIT.

Acumen's founder Jacqueline Novogratz, Iqbal Quadir and others working in this field have also been topics of contemplation in this weblog and have been included within the Pearls of Paradigm Processing Social and Economic Paradigms.

No final conclusion, just an ever increasing realization of the complexity of the issues. As Emily Oster, the University of Chicago economist, pointed out we need to look for root causes in not only understanding poverty and poor health care -- but also other issues such as the price of coffee, and the routes of long-haul truckers.

“In short, there is a lot we don't know; and our assumptions about what we do know may keep us from finding the best way to stop the disease.”

The Bricks For Building Dreams

CoolPeopleCare | There's a Rumbling
"Passion is key for anyone looking to start something new. It's not all you need, but it's a big part of what's necessary when you set out on your own. Finding the right balance of passion and realism is key."

Those are the words of Samuel Davidson, a blogger who appears to be at the cusp of Generation X and Y, and who has provided food for thought for this weblog before. I like him because he combines idealism with pragmatism. This weblog has talked about his 4 step process from dream to reality before.

"That's the thing about passion – it's always there with us. For some of us, we wear it on our sleeves and those who know us know that we're about something..."
"Because when you have a passion, you know it. And there's no way you can't not follow it." But passion is never all we need. It's the first thing you need during the early stages of start up, but it alone won't get you to the finish line. It may not even get you to step 2. As Robert Greenleaf so eloquently pointed out:"

"Not much happens without a dream. And for something great to happen, there must be a great dream. Behind every great achievement is a dreamer of great dreams. Much more than a dreamer is required to bring it to reality; but the dream must be there first."

I am not quite as ready to accept his position on Schumpeter.

"Schumpeter was a very early advocate of entrepreneurship, believing that individual invention was what powered a capitalist economy, and not the role (or non-role) of the government. McCraw points out that while Schumpeter's ideas didn't immediately catch on in the first half of the 20th century, he now looks like a genius." McCraw writes:

"One of the hallmarks of Schumpeter's 1911 book is that he ventured into territory where no economist had gone before - namely, the psychology of entrepreneurs. Entrepreneurs, he insisted, are not propelled solely by a wish to grow rich or by any "motivation of the hedonist kind." Instead, they feel "the will to conquer: the impulse to fight, the prove oneself superior to others, to succeed for the sake, not of the fruits of success, but of success itself...There is the joy of creating, of getting things done, or simply of exercising one's energy and ingenuity.

As someone who identifies with Schumpeter's definition, I believe that the organizations and companies that will succeed in today's economy will be those that embrace entrepreneurship at every level.

While I can readily agree with, "There is the joy of creating, of getting things done, or simply of exercising one's energy and ingenuity" Schumpeter may be getting better press than he deserves because its a quick sell for the ideas people want to get across, but Schumpeter does not philosophically epitomize the ideals being expressed as he may seem on first look.

I do appreciate the concept of creative-destruction but keeping in mind the words of F. Scott Fitzgerald

"The test of a first rate intelligence is the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function."

We need to appreciate the effect of the destruction as well as the creation.

Free Rice and Webslides

FreeRice: Banners

I have been playing around with the bells, whistles and widgets that make up this weblog. That is one of the basic reasons for creating this experiment in the first place. One new item combines a desire to find out if Web 2.0 can really be of any benefit and how. The answer is simple. This is about as simple as you can get and it helps make you smarter as the same time. What's to lose?

Also experimenting with diigo webslides. I like the look, I only wish that one slide projector could load up more than one list so the users could change it they wished to. Both Free Rice and the webslides are at the left-hand column.

Like Trying to Milk a Fish

The Entrepreneurial Mind wrote Like Trying to Milk a Fish on 11/30/07

The concept of social entrepreneurship has also been explored a number of times by this weblog. Jeff Cornwall introduces us to social entrepreneur Sam Davidson has a thoughtful reflection who at his blog tells us about what it is like being an early-stage entrepreneur.

Those who know me know that I never planned on being an entrepreneur, but that I enjoy every single minute of it. There's risk, there's reward, there's freedom, there's excitement, there's disappointment, there's opportunity - and that's just Monday before lunch. And so when people ask me what it's like to start my own company and be a social entrepreneur, I tell them:

"It's like trying to milk a fish."

Sam is a co-founder and President of CoolPeopleCare

Below is a short video from their website on who they are.

Finding Connections In All Directions

Unlike some blogs, this one does not only connect to the immediate and often transitory concerns. It will re-connect to the past and find new pathways forward, revisiting and rethinking previous themes. One of these is the connections found under Shifting to a Better World. These included Kiva.org and the Catalogue for Philanthropy GREATER WASHINGTON 2007-08 that were written about before. Since then my web-wandering found similar sites closer to home, California Community Foundation, Southern California Grant Markers and the San Francisco Homeless Resource - a Wikia wiki are three examples of what can be done combining web 2.0 with philanthropic work. However, it doesn't seem that anyone has done on the west cost what Greater Washington did on the east coast.

Shifting to a Better World also has a link to to the William J. Clinton Foundation and the new YouTube MyCommittment.Org which promotes the Clinton Initiative. Google is also only helping to promote social responsibility through Checkout for non-profits. Other avenues for micro-financing include E-Bay according to BusinessWeek.

"Microlending is just a good fit for eBay," says eBay spokeswoman Catherine England. "It really leverages eBay's areas of expertise to address what we see as an emerging market." Omidyar is also an investor in Kiva, a microlending site run by former TiVo (TIVO) executive Matt Flannery and former PayPal executive Premal Shah.

Finally, in addition to new resources, there is also potential inspiration from How to Save the World and How to Change the World with No Plan, No Capital, No Model...No Problem. New resources will be added as time goes on.

You Can't Talk Your Way Through A Paradigm Shift

Businesspundit: YUM Brands and The World's Largest CSR Project

This caught my eye because it is in direct opposition to another article that I decided to bypass because it wasn't clear to me what was the intention of the article and my general sense was negative. Watch Out for Anti-Social Responsibility Campaigns

Rob, the author of the first blog admits to being, "skeptical of these types of corporate projects, but Yum employees have really supported this effort, donating money and time to help make a difference. Regardless of your philosophical views on CSR, this project is interesting because Yum seems to be walking the walk, not just talking the talk."

The title of the second blog post is confusing. "Social responsibility is being embraced by businesses. But as more companies participate in causes, watch out for “anti-social responsibility” activists. If your business has any vulnerabilities to a negative public relations campaign by a passionate activist, participating in a highly-publicized cause may be just the thing that puts your vulnerabilities under a spotlight." So are we being warned about spoilsports who ruin the party or are we being warned that if we we need to walk the walk and not just talk the talk. This weblog has raised concerns before with superficial efforts to address problems that focus more on style than substance and not just with businesses.

S.F. offering healthcare to neediest via Los Angeles Times via kikono.org story:

First the original story, S.F. offering healthcare to neediest - Los Angeles Times - I found this story interesting from the civic side that a local, though larger than most government, was trying to take on such a difficult undertaking. Also found it interesting from the economic side because the article did not go into details how it is being financed. Small businesses are already gearing up against it. Finally, it was interesting because the emphasis is on prevention or early intervention. How many social issues would be alleviated if they could be addressed early?

This was my first post on a new website I found through, once again, serendipity. The site looks interesting and incorporates some of th e same ideas I have been playing around with, minus in my case the technical prowess. It looks like a good place to learn a thing or two. The site also uses del.icio.us tags which I find quite useful.

Here is a link to the story on kikono : http://www.kikono.org/story.php?id=3265

Compassion is Compassion Neither Conservative Nor Liberal

The Entrepreneurial Mind had an inspiring post on Giving in the Entrepreneurial Culture. He cites Dr. Arthur Brooks of Syracuse University and author of Who Really Cares: The Surprising Truth About Compassionate Conservatism.

He (Dr. Brooks) summarized his findings by dispelling the four common myths about giving:

Myth #1: Giving makes us poorer
Giving is not the zero sum that so many assume. Those who give become richer over time.

Myth #2: People are naturally selfish
As mentioned above, we seem to be hard-wired to give. It is not natural for humans to be selfish. Rather, it is natural to give to others.

Myth #3: Giving is a luxury
The working poor give the highest percentage of their income of all income brackets. Second come the rich. The stingiest are the upper middle class.

Myth #4: An entrepreneurial nation can afford to forgo service
In fact service is part of what seems to have built our entrepreneurial culture and economy.

Philanthropy via Web 2.0

Here is another concept found on the web. This one only applies to the general Washington area but it shows what can be done.

The Catalogue for Philanthropy: Greater Washington introduces you to the world of smaller, local charities – with budgets below $2 million. Though they comprise about 85% of all nonprofits, the public rarely hears about them because most cannot afford to make themselves heard. Yet dollar-for-dollar, they offer some of the most cost-effective opportunities for philanthropy. If "making a difference" is one of your goals, then excellent smaller charities may be for you.

Saving the World Next Door

This weblog continues to evolve. The last few posts have dealt with social entrepreneurship and philanthropy. These have now been made part of the permanent structure of this weblog under Pearls of Paradigm Processing Shifting to a Better World.

Sharing the Wealth of Giving

Google contributes a great deal to the efforts undertaken by this weblog. Obviously the blog is Google based as is the to Innovation, Insight, Integrity Reader and the Paradigm Pathway Notebooks. Ask.com provides a good deal of infrastructure to this site and its searches are powered by Google.

More importantly all this is free (yes they do have language stating that they can use my documents in Google Documents but there is either nothing that anybody would want or nothing that I would not willing provide).

This is still an individual effort but the potential for non-profits, for non-governmental agencies (a term which is both unimaginative and limiting) and for other change agents is tremendous. In a supposedly Web 2.0 world moving to Web 3.0 and even 4.0 this seems old hat. Yet I am convinced that there are numerous organizations out there that are still using e-mail like letters or at best telephones and use websites as nothing more than interactive posters.

There are a tremendous amount to be learned from organizations such as TED and MIT ,but I have to wonder to what extent this have been integrated throughout the hundreds of social change organizations that have been arising in the last decade.

The latest from Google offers yet another tool for invoking beneficial Paradigm Shifts.

YouTube and Checkout for the non-profit world