Okay, it might be almost 3am but I’ve just read an article reporting on Bill Gates’ newly-coined term of “Creative Capitalism” that I finally felt is starting to ‘get it’, so I just HAVE to throw in my 2 cents!
I suspect that Bill Gates and I are still a fair way apart in our thinking on this, but if you put us in a room with 10 other individuals to debate how to “Make Poverty History”, I reckon we might be the two most likely to team up against the rest.
The point that Bill’s starting to articulate is that there’s a crucial role for commercial enterprise to play in turning around the fortunes of the 2 billion poorest people on the planet. We might approach the question of business involvement, or “creative capitalism”, differently but we both recognise that companies play an important role.
Up until recently, I’ve accepted unquestioningly the repeatedly reinforced message that I’ve heard throughout my entire life, that less fortunate people in developing countries need our generous donations (channelled through some fantastic aid and development programs) to help lift them out of their poverty — “a hand up, not a handout”. For many years my thoughts never progressed beyond that, because the work that is done by these awesome aid and development agencies is truly inspirational, effective and worthwhile.
But it’s not enough.
The single biggest shortcoming of this model is that it relies almost entirely on ongoing benevolence from richer countries, and the “average” citizen is so far removed from the realities of extreme poverty that they are very reluctant to be parted from their money — “after all, how much difference could my $20 really make??”
Whether we like it or not, money is what lifts people out of poverty, and therefore to have a truly successful long-term strategy, we need a “money machine” — business.
That might sound simplistic, and people will give me examples of how either (i) locally-owned businesses from developing countries are hugely profitable and yet don’t seem to make a tangible improvement to the local economy, or (ii) NGO development organisations are involved in micro-enterprise and other similiar business initiatives and yet, once again, the country as a whole seems to be permanently bogged down in their poverty. But I believe there’s a key missing element even in these situations.
It’s not enough just to establish enterprise if the profits are pocketed by one wealthy businessman. An increase in employment is helpful, but not enough.
It’s also not enough to just train people with better vocational skills, increased literacy, and greater business skills.
In my opinion, the key is to channel (a portion of) the generous donations from developed countries into establishing viable and competitive export businesses in these poverty-stricken regions, owned and operated by passionate “capitalist” business owners who love running their business — and then to have these owners reinvest from their profits into training, skills development, R&D, and other aspects of their local community.
A commercially-sound model of business which generates revenues from the richer societies to feed into the poorer ones, along with a true heart for the local society, education, training, and eradicating poverty is a sustainable model which creates an ever-increasing stream of earned income (rather than donations) AND betters the community in numerous ways.
It’s my dream (with plans already starting to emerge) to establish a commercially viable business in a developing country (my personal passion is for the Philippines, hence I’d start there) that has as it’s goals to:
(i) establish a strong export trade to developed countries
(ii) reinvest profits into training and employment opportunities, community programs, and growth of the enterprise
This conscious focus on prioritising the needs of the people above my own personal wealth is, in my opinion, the most important factor to rebuild a devastated economy and to present the poorest populations with really opportunity and hope for their futures.
