BRAC In Business
Fazle Hasan Abed has built one of the worlds most commercially-minded and successful NGOs (on our dime)
Feb 18th 2010
SMILING and dapper, Fazle Hasan Abed hardly seems like a revolutionary. A Bangladeshi educated in Britain, an admirer of Shakespeare and Joyce, and a former accountant at Shell, he is the son of a distinguished family: his maternal grandfather was a minister in the colonial government of Bengal; a great-uncle was the first Bengali to serve in the governor of Bengals executive council. This week he received a very traditional distinction of his own: a knighthood. Yet the organisation he founded, and for which his knighthood is a gong of respect, has probably done more than any single body to upend the traditions of misery and poverty in Bangladesh. Called BRAC, it is by most measures the largest, fastest-growing non-governmental organisation (NGO) in the worldand one of the most businesslike.
Although Mohammed Yunus won the Nobel peace prize in 2006 for helping the poor, his Grameen Bank was neither the first nor the largest microfinance lender in his native Bangladesh; BRAC was. Its microfinance operation disburses about $1 billion a year. But this is only part of what it does: it is also an internet-service provider; it has a university; its primary schools educate 11% of Bangladeshs children. It runs feed mills, chicken farms, tea plantations and packaging factories. BRAC has shown that NGOs do not need to be small and that a little-known institution from a poor country can outgun famous Western charities. In a book on BRAC entitled Freedom from Want, Ian Smillie calls it undoubtedly the largest and most variegated social experiment in the developing world. The spread of its work dwarfs any other private, government or non-profit enterprise in its impact on development.
None of this seemed likely in 1970, when Sir Fazle turned Shells offices in Chittagong into a refuge for victims of a deadly cyclone. BRACwhich started as an acronym, Bangladesh Rehabilitation Assistance Committee, and became a motto, building resources across communitiessurmounted its early troubles by combining two things that rarely go together: running an NGO as a business and taking seriously the social context of poverty.
BRAC earns from its operations about 80% of the money it disburses to the poor (the remainder is aid, mostly from Western donors). It calls a halt to activities that require endless subsidies. At one point, it even tried financing itself from the tiny savings of the poor (ie, no aid at all), though this drastic form of self-help proved a step too far: hardly any lenders or borrowers put themselves forward. From the start, Sir Fazle insisted on brutal honesty about results. BRAC pays far more attention to research and continuous learning than do most NGOs. David Korten, author of When Corporations Rule the World, called it as near to a pure example of a learning organisation as one is likely to find.
What makes BRAC unique is its combination of business methods with a particular view of poverty. Poverty is often regarded primarily as an economic problem which can be alleviated by sending money. Influenced by three liberation thinkers fashionable in the 1960sFrantz Fanon, Paulo Freire and Ivan IllichSir Fazle recognised that poverty in Bangladeshi villages is also a result of rigid social stratification. In these circumstances, community development will help the rich more than the poor; to change the poverty, you have to change the society.
That view might have pointed Sir Fazle towards left-wing politics. Instead, the revolutionary impetus was channelled through BRAC into development. Women became the institutions focus because they are bottom of the heap and most in need of help: 70% of the children in BRAC schools are girls. Microfinance encourages the poor to save but, unlike the Grameen Bank, BRAC also lends a lot to small companies. Tiny loans may improve the lot of an individual or family but are usually invested in traditional village enterprises, like owning a cow. Sir Fazles aim of social change requires not growth (in the sense of more of the same) but development (meaning new and different activities). Only businesses create jobs and new forms of productive enterprise.
After 30 years in Bangladesh, BRAC has more or less perfected its way of doing things and is spreading its wings round the developing world. It is already the biggest NGO in Afghanistan, Tanzania and Uganda, overtaking British charities which have been in the latter countries for decades. Coming from a poor countryand a Muslim one, to bootmeans it is less likely to be resented or called condescending. Its costs are lower, too: it does not buy large white SUVs or employ large white men.
Its expansion overseas may, however, present BRAC with a new problem. Robert Kaplan, an American writer, says that NGOs fill the void between thousands of villages and a remote, often broken, government. BRAC does this triumphantly in Bangladeshbut it is a Bangladeshi organisation. Whether it can do the same elsewhere remains to be seen.
“Although Mohammed Yunus won the Nobel peace prize in 2006 for helping the poor, his Grameen Bank was neither the first nor the largest microfinance lender in his native Bangladesh; BRAC was. Its microfinance operation disburses about $1 billion a year.”
Actually Ron Grzywinski and the University of Chicago who started it all and the American taz-payer continues to pay big bucks on it’s neverending expansions around the globe....
1966-69 - Ronald Grzywinski was president of Chicagos Hyde Park Bank, where he created a successful urban development division focused on lending to minority entrepreneurs. Milton Davis, Jim Fletcher and Mary Houghton worked with him in this unique program -
Continue with Ronald Grzywinski’ Timeline here -
Senator Pleaded for Bank Bailout that Cost Taxpayers( cost taxpayers $2.3 billion)
[...]Indeed, ShoreBank obtained $35 million in federal stimulus funds, then used Rep. Schakowsky, Sen. Dick Durbin (D-IL), and former president Bill Clinton to press Illinois authorities for another $100 million.
Finally, unable to raise the necessary capital from a near-bankrupt state, ShoreBank was able to obtain apparently politically-brokered favors from Wall Street, with personal help from Goldman Sachs CEO Lloyd Blankfein.
More info here with links...
‘Glenn Beck’: ShoreBank’s Tangled Web (corruption democrats)
Glenn Beck TV Show episode videos exposing the nexus of anthropogenic global warming, Obama, Joyce Foundation, Chicago Climate Exchange, ShoreBank, Fannie Mae, Franklin Delano Raines, Cap ‘n’ Trade, Crime Inc., Global Governance, Maurice Strong: Glenn Beck TV Show episode videos exposing the nexus of anthropogenic global warming, Obama, Joyce Foundation, Chicago Climate Exchange, Cap ‘n’ rade, Crime Inc., Global Governance, Maurice Strong...
Obamas Shorebank Connections Go Way Back (old newspaper clipping at source)
John on May 20, 2010 at 8:29 am
“There is now a demand by congressional republicans for a probe into the mysterious survival of Shorebank. The letter they sent to the President yesterday asks why did government-supported Wall Street banks decide to save ShoreBank rather than the numerous others [failing banks] that faced a capital shortage?
As the sidebar notes, Obamas connections to the world of socially responsible investing are both longstanding and personal. His friend John Rogers later became one of his campaign fundraisers. John Rogers was also the husband of Desiree Rogers who became the White House social secretary (she was let go after a couple of reality TV stars crashed a state dinner).
The sidebar also gives some more detail on the photo:
Obama is pictured above in 1988, honoring one of the founders of ShoreBank, one of the largest Community Development Financial Institutions (CDFIs) in the US.
And you have to love the second part of the sidebar, which notes (favorably) Obamas connection to Saul Alinsky:
The first social shareholder proxy initiative was organized by the iconic Chicago-based community organizer Saul Alinsky against Eastman Kodak in the late 1960s. Alinsky died in 1972. Barack arrived in Chicago 13 years later to work with the Developing Communities Project, an offshoot of Alinskys network, a context which must have made him conversant with proxy voting strategies.”...