Ecosystem for business

Abed provides an example: “In the 1990s BRAC started investing in maize seed in Bangladesh. The goal was to help smaller, often female poultry farmers with a higher quality animal feed. At the time, the maize market was nearly non-existent: we even had to give smaller poultry farmers a buy-back guarantee to convince them to plant the new seeds. The ultimate goal was to create an ecosystem for business. The maize market in Bangladesh is now up and running, with a large number of private companies – including ours, which is called BRAC Seed – competing for the favour of the farmers. We have thus created our own competition, but in our view, that’s a great success!”

Having an impact

Abed laughs when making that statement. He is familiar with the criticism of BRAC, which in Bangladesh only depends on donations for around 20%, generating the other 80% of income via its own social enterprises and micro-financing. This has become a business model and the development organisation is said to have become too commercial and focused on profit; a concept in line with the image of an out of control aid industry. Abed responds coolly: “All income from our enterprises is returned to our projects. And I personally believe that you must always aim to have an impact, socially and/or financially.”

Blurring boundaries

Chinese walls between pure for profits and NGOs – if they ever existed – are no longer applicable. Abed: “The boundaries between big business and social impact are blurring, partly due to the pressure from corporate shareholders of listed companies to look at sustainability and corporate social responsibility. On the other hand, NGOs and civil society organisations have turned a few pages of the business book themselves, and sometimes function as normal companies with a triple bottom mentality: focus on people, profit and planet.”

It begins with business

“Look, when young people ask me for advice about starting development work, I often say – to their surprise – that they should first work in business for a year or so. It didn’t do me any harm. I was tried and tested as an accountant and employee at Shell, and am still grateful for that today. I learned valuable lessons on how to realise plans in an operationally efficient and large-scale way.”

Income from own activities

The development of various hybrid organisation types, in which business and social impact are linked, is a hopeful one Abed says: “Because you want to generate sustainable impact and not always depend on donors. And let’s be clear: while BRAC is eternally and deeply grateful to its donors, I have always emphasised that we should try to be as self-sufficient as possible. It is no coincidence that the majority of BRAC’s income in Bangladesh comes from our own activities, such as various social enterprises and micro-financing, and companies for textile, seeds and dairy products.”

Revenue models lead to dilemmas

This more entrepreneurial approach also generates intense debates on the course of the organisation within BRAC itself. Revenue models lead to dilemmas, because they often introduce the same perverse stimuli that may easily result in creeping corruption of the initial goals. Abed: “We are currently looking at ways to recover our schooling costs. Our education programmes are self-financed for 35%. Public education in Bangladesh is not especially high-quality and it is mainly the middle class that is willing to contribute to private schooling. Four-fifths of this group is willing to spend a small amount – around 20 dollars a month – on access to our BRAC schools, which have an excellent reputation in the field of primary education. The 20 percent with the lowest income who cannot afford it are admitted for free.”

Dinner with Steve and Laurene Jobs

The success of the BRAC methods developed over the decades and measured independently by prestigious universities in the US and UK. Catching the attention of leaders and businessmen abroad, the UN and World Bank approached Abed with a request to implement the BRAC programmes in Afghanistan after the military invention by the West there. And so he did.
 Abed: “And then I met Apple’s Steve Jobs in 2002 after being on a discussion panel with his wife Laurene. During a dinner at his house, Steve asked me: “How come it took you 30 years to bring BRAC to different countries?” My response: “Bangladesh was my universe for 30 years. I never considered that it could be an export product.” But now I think it might be, partly based on our experiences in Afghanistan. Although we’d obviously have to incorporate changes related to culture and traditions, I believe the basic elements, such as health, nutrition, education, family planning, women’s empowerment and the like are globally applicable.”
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