In recent posts we have written about malnutrition and children’s stunting rates in India, social enterprises in England and a business executive fighting modern day slavery. This post attempts to demonstrate the interrelatedness of these and many of the world’s most serious challenges.
In the Nagada village within the Jajpur district of India, 12 children died over a 4 month period this year. The cause was malnutrition. Recently, Aspire conducted a health survey in the village and determined one-third of its 83 children were malnourished. This figure is similar to India’s overall prevalence rate of 38% for children suffering from stunting, where India ranks 114 out of 132 countries for this condition. At Hurduu, we are dedicated to increasing awareness of the challenges children face each and every day.
Nagada Village is home to one of the world’s richest deposits of iron, chromium and manganese. All our leather goods (purses and handbags) are tanned using chromium. The chrome on our cars was plated with chromium. Manganese has many uses including use as a leading component in cellphone batteries. The village population of Nagada is 275 people. Nagada does not have a school or health facility. Schools are a leading source of nutritional meals. So why the immediate adjacency of extreme wealth and severe poverty?
In addition to humanitarian groups, villages like Nagada need “social enterprises.” Social enterprises are companies that aspire to make positive impacts in people’s lives and/or the environment. Investors who fund these enterprises are involved in “impact investing.” Husk Power Systems is one such social enterprise that brings electricity to India’s remote villages. Using solar energy by day and biomass processes (rice husks) by night, Husk Power Systems provides 24/7 electricity via micro grids to 500 people at a time. While the obvious beneficiaries are homes with school age children who can now study at night, the unintended market has been the rise of new businesses that cater to their local clientele, both night and day. This reduces the need for humanitarian aid and provides villagers the pride and fruits of their labors. The impact that Husk Power Systems produces also includes employee livelihoods and technical training, as well as cleaner energy, eliminating the need for kerosene burning lamps. As business and civil society grows, poverty is lessened and health & human rights metrics improve.
At the Miller Center for Social Entrepreneurshipon the Santa Clara University campus, we help accelerate the development and impact of companies founded by social entrepreneurs. We have accelerated the effectiveness of over 500 social enterprises. Our newest efforts include working directly with impact investors.
My goals within impact investing are threefold:
Actively place capital directly in social enterprises and help investors improve lives and increase the number of participants in the global economy.
Making measurable financial, social and environmental impacts, targeted towards underserved individuals and communities.
Providing complementary and integrated forms of investment capital (grants, equity, debt, working capital) aimed at solving high-impact social and environmental challenges.
With this “participant capital,” social enterprises can replicate and scale, increasing the number of individuals participating in the global economy. All because investors became participants themselves.