DURHAM — Nobel Prize laureate Muhammad Yunus has been traveling the country to promote the idea of social business — companies designed to tackle a social problem — and his success in microfinance as a model for the future.
He also encourages students, community members and social entrepreneurs to find innovative, market-based solutions to pressing social and environmental issues at the state, national or global levels through social business innovation challenges.
On Sept. 30, Yunus will visit the University of New Hampshire to help judge the state competition and participate in the first New Hampshire Social Business and Microfinance Forum.
Social businesses aim to be market-based and fund operations and growth through earned revenues rather than donations. But like nonprofits, they have a primary social, rather than financial, objective.
“I think whether it’s New Hampshire or around the world, society is largely coming to the conclusion that the traditional models of charity and aid are not sufficient alone,” said Fiona Wilson, assistant professor of strategy, sustainability and social entrepreneurship at UNH and director of the social business innovation challenge. “They have a very important role to play, but they are not sufficient alone to address the burgeoning scale of environmental and social problems that affect us today.”
Wilson said Yunus, now in his 70s, created the challenge as he began thinking about his legacy and how to share his ideas on social business and microfinance with a broader audience, particularly the younger generation.
“He is trying to spread understanding about what a social business is and why he believes it is a highly effective way of addressing the myriad social and environmental problems in the world,” Wilson said.
She said the traditional model of dealing with issues like hunger, poverty and climate change has been to leave it to the government and nonprofits.
Yunus’ idea is that programs to address the issues often do not address the underlying wound and that social businesses can serve as a more permanent solution to problems.
A global example is Grameen Danone, a collaboration between the largest maker of yogurt in the world and Yunus’ microfinance company, which aims to fight malnutrition among rural poor in Bangladesh.
Wilson said this is accomplished by selling fortified yogurt at a normal price in wealthier, urban areas of the country and selling it for just a little above cost in poorer, rural areas.
“So for the first time populations have access to healthy food with nutrients they are missing at a price they can afford to pay,” Wilson said.
The goal of the business is to be financially self-sufficient, and that’s it. If it does make a profit, it will be reinvested into growing the organization or making products to benefit the poor, she said.
Local social entrepreneur
In New Hampshire, an example of a successful social business is Concord-based ROC USA. The CEO of the company will be honored as the social entrepreneur of the year at the Sept. 30 event.
ROC USA helps create resident-owned communities by helping people living in manufactured housing parks to buy the land they live on, providing them more housing security.
Wilson said she hopes the competition will inspire other college students and community members to come up with their own innovative social business ideas.
“We are hoping it will really excite people about sharing the idea that they or others might want to implement,” Wilson said.
Cash prizes will be awarded to the top three community competition winners and top three college student winners with the goal of helping provide investment to social businesses to help fund establishment and/or growth.
The first-place community team will also receive 100 hours of consulting from Portsmouth-based Web strategy, design and development firm PixelMedia and six months of complimentary participation in the New Hampshire Innovation Commercialization Center’s accelerator program.
A group of alumni and community business leaders are crowd-funding additional prize money and pledged the initial $2,300 toward the $5,000 goal.
Local entrepreneur Tom Elliott is helping to lead that effort. He said it seemed like a great way for UNH to try crowd funding, for the local business community to help make the event a success, and to encourage people to get involved even if they cannot compete.
Moving forward, Elliott said every entrepreneur is going to have to think in terms of a social context.
“I think it’s very clear that customers and consumers are more and more attaching their purchases to their values,” Elliott said. “It will be very hard to be in business in 50 years without having a legitimate social value attached to how you do business.”
The public is invited to the final round of the New Hampshire Social Business Innovation Challenge on Sept. 30 in the Piscataqua and Squamscott rooms at UNH’s Holloway Commons beginning at 8 a.m. Yunus will give a keynote address and present awards beginning at 10 a.m. in the Granite State Room of the Memorial Union Building.
The event is being co-hosted and organized by the Peter T. Paul College of Business and Economics and the Carsey Institute, both located at UNH.