BANGKOK (Thomson Reuters Foundation) - Social enterprises run by women and young people can fix the world’s most pressing problems - from climate change to wealth inequality - because they are often closest to such issues, Nobel laureate Muhammad Yunus said on Thursday.
Bangladesh’s Yunus won the Nobel prize in 2006 jointly with Grameen Bank, the microfinance organization he founded. He has since turned his attention to social businesses that he said are better equipped to solve some of the world’s biggest challenges.
Social businesses – which are set up specifically to tackle social and environmental problems through commercial means – are mushrooming across the world, with even large companies wanting to show they care about people and the planet.
But it’s women and young people who can have the most impact, Yunus told the Thomson Reuters Foundation ahead of a social business event in Bangkok.
“Social businesses are growing because people are frustrated with the conventional economy, the old way of doing business, which is not delivering results in areas like sanitation, waste management, green energy, and affordable healthcare,” he said.
“Women and young people perhaps understand these problems better because they are most affected by them. Social business can fix any problem, and anyone can just jump in and get started without waiting for the government or big donors.”
Nicknamed “banker to the poor”, Yunus started his movement 40 years ago with loans worth just $27 to women in Chittagong, Bangladesh, to help them escape what he described as a relationship of “slavery” with loan sharks.
Grameen Bank has since delivered millions of tiny loans to poor people who do not have access to mainstream banking.
Yunus’s first foray into social enterprises was with French food giant Danone in Bangladesh to develop a local option to expensive imported baby food.
Grameen Danone now makes an affordable and nutritious yogurt for malnourished children. Grameen Bank has also tied up with apparel maker Uniqlo, technology company Intel, and waste management firm Veolia for other social business ventures.
“Businesses are interested because they want to be seen as caring, and fixing problems they themselves may have helped create,” Yunus said.
“But not everyone has to work for a big business - that’s the traditional approach. Instead, we should all be entrepreneurs and use technology, and our creativity and energy to solve problems,” he added.
This will also help narrow the widening wealth gap - which Yunus said is a “ticking time bomb” that can cause greater social and economic unrest if left unaddressed.
Some countries in Asia, including Thailand, Vietnam and the Philippines have passed legislation or revised laws to support social business ventures.
But what’s more important is adapting educational institutions and the financial system to encourage entrepreneurship and social business, Yunus said.
“We need a new economic structure to fix problems,” he said. “If we go down the same old path, we will arrive at the same old destination. To solve today’s problems, we need new paths.”
Reporting by Rina Chandran @rinachandran; Editing by Michael Taylor. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, women's and LGBT+ rights, human trafficking, property rights, and climate change. Visit news.trust.org