A welcome break from the news of investment scandals and political escapades came on March 26th at the Robert H. Smith School of Business, as the University of Maryland held a Social Enterprise Symposium. The interest in social enterprise was apparent since the event attracted hundreds of students, faculty, guests, and alumni. A keynote speech by GE’s Steve Fludder, VP of Ecoimagnination and Corporate Officer, addressed big business’s interest in the concepts underlying sound corporate citizenship – emphasizing that a company can grow while doing good. Perhaps most pertinent topic to our current economic times were the details on cost savings realized by companies that invested in waste, energy, and water reduction.
In a follow up session on socially responsible investing Lisa Hall of the Calvert Foundation presented an interesting investment tool, called the Calvert Community Investment Note, that provides low interest capital investments to communities in need. Although returns are not large – capped at 3% – this particular asset class has been attracting more attention as a relatively safe investment offering higher returns than Treasuries at the moment.
Throughout all of the discussion about all the good that business was doing in communities around the world there seemed to be an 800 pound gorilla in the room everyone failed to recognize – the lack of institutional capacity in the majority of emerging markets. While microfinance, social investment, and entrepreneurship programs have undoubtedly allowed millions to help themselves out of poverty there seems to be no plan on how to address the underlying reasons for poverty.
What will happen when the woman who started a small fruit stand with a micro loan would like to expand her business? Register her property? Use the business as collateral for a larger loan to expand? These questions are not easily answered. Providing capital to micro-businesses and reducing company waste are good first steps, but there is a long road a head for the further elaboration of what corporate citizenship really means.
Published Date: March 30, 2009