“I am proposing to create a new kind of business. One based on the selflessness that is in all of us,” says Professor Muhammad Yunus, Co-Founder and Chairman of Yunus Social Business (YSB) and the 2006 recipient of the Nobel Peace Prize.
Yunus firmly believes that the possibilities are endless for changemakers trying to address the most pressing social issues of our time by using the powerful and efficient motor of business.
In 2015, the United Nations introduced the Sustainable Development Goals (SDGs), global commitments covering everything from extreme poverty and hunger to climate change and income inequality. The SDGs have begun to inspire leaders in the public and private sector alike.
“All 17 difficulties we have today were created by the system, by focusing on the maximization of profit,” says Yunus. “You can’t solve these problems by following the same path. You have to go back and build a set of new roads. Social business is one road.”
The YPO Entrepreneurship and Innovation, Leadership Development, Global Diplomacy and Social Engagement Networks held, “Harnessing Social Business to Change the World,” an online event with Yunus. He shared his personal experiences as a social entrepreneur as well as his insights on how influential CEOs and social entrepreneurs can create and support social businesses to achieve global goals.
The sheer magnitude of these social issues can easily swallow an individual’s, a company’s and even a corporation’s ambition. But the truth is, each of us has the power to make an impact. “As a spur-of-the-moment action,” Yunus began lending money to impoverished Bangladeshi villagers to protect them from loan sharks. He had no idea a few loans in one village would grow into Grameen Bank (GB), the beginning of a micro-finance revolution and a critical resource for women around the world. “If an idea is sustainable, it can grow from a tiny start to mega,” says Yunus.
Today, GB has more 9 million borrowers, 97 percent of whom are women, in more than 80,000 villages in Bangladesh. In the United Staates alone, GB has 21 branches that have changed the lives of 100,000 women. “Each branch of the bank is a sustainable branch,” says Yunus. “It can grow and create as many branches as you want.”
Yunus began to see more opportunities to make money and do good by fixing seemingly insurmountable problems from health to sanitation through simple, scalable, social business solutions. To address the issue of sanitation, for example, he created a company to produce affordable toilets, which could be purchased with a loan from GB. As a result, 9 million families now have access to a toilet. He has created programs to provide health insurance, health care and solar energy to villagers with similar impactful results.
Leveraging the power of business
“The conventional theory of economics gives us glasses with a dollar sign only,” says Yanus. “I’m trying to give you bifocal glasses where you see the dollar sign and the people sign.”
Business leaders can run a profit-making business while simultaneously creating a social business to solve a problem closely linked to the mission of the business. In 2005, YSB partnered with Emmanuel Faber, CEO of Danone, on the social business joint venture Grameen-Danone Foods to address malnutrition in Bangladesh. Danone began producing yogurt with all the micronutrients that children were missing. The objective: to make it affordable to the poorest family.
“If you are a social business, you see there is a lot of room to reduce the cost of things because you don’t need any thrills, any gimmicks, any advertisements,” says Yanus. “We cut out all of this and the cost of production came down.”
The success of that initial partnership led to the creation of Danone Communities, a EUR90 million fund that invests in social businesses in 12 countries with 1 million beneficiaries. Not only did Danone create a social business to complement its profit-making business but the company is also empowering social entrepreneurs targeting nutrition and safe drinking water to achieve sustainable social impact around the world. More than half of Danone’s French employees also contribute to the fund.
Social change within for-profit businesses starts at the top says Yanus. The head of a company wants to find a way to use the core competencies of the business to not only make money but actually solve problems, too. A CEO like Faber opens up the potential for exponential growth in reach and impact. “It grows with its own speed, its own momentum,” says Yanus. “And Danone did reap business benefits while they created and brought innovation to other parts of the company.”
While the desire to solve a problem may start with one person, the idea does not have to come from that individual. “You challenge others,” says Yanus. “The moment you open it up, people come up with amazing solutions that may not be the final. But once you start with one, the next person will come up with another that is much better than the previous version.”
Another way to challenge others to develop solutions is to invest in local entrepreneurs so they can grow and scale their social impact. For example, YPO member Bharat Doshi, Director at Dunhill Consulting, Thika Road Mall, Treadsetters and Imaging Solutions, helped launch and became a Country Partner at YSB Kenya, a new fund dedicated to harnessing the power of social business to end poverty. By 2020, YSB Kenya aims to fund 30 social businesses, creating more than 30,000 jobs and impacting more than 2 million people in Kenya.
“For me, making money is a happiness but making other people happy is a super happiness,” says Yanus. “I’m chasing that super happiness because I want to make sure I have enough. Feeling excited about your capacity, your own role in society and in the broader world itself is an intoxicating experience.”