It was the day after Gandhi Jayanti that I got on to a train to Deoghar, in Jharkhand. My friends at Pradan (Delhi-headquartered NGO, active in seven states) had been nice enough to help me plan this trip.
Deoghar district, like neighboring Godda & Dumka, figures in the ‘Most Backward 100 districts’ list, published by India Today few years ago.
So, it was a fascinating coincidence that, as the CII-sponsored ‘India @ 60′ celebrations got underway in New York – the epicenter of the globalized economy- here we were, in Jharkhand, about to witness an experiment in home-grown Gandhian model of economic development.
Without sounding hopelessly romantic or impractical, I must say I came away reasonably convinced that Pradan’s Gandhian-style economic model, juxtaposed with the western-style market economy, can actually be a recipe for inclusive growth. I got a glimpse of how Pradan has organized 100,000 families into 5300 Self-Help Groups (SHGs), to enhance their livelihood options, and escape poverty.
Although most families in Jharkhand own 1-2 acres of land, but they are constrained by the uneven terrain, quality of land, and lack of irrigation. In such a situation, Pradan identifies and develops enterprises suitable for local needs, provides resource persons, and creates linkages with government and financing agencies. So you have Tasar plantations, poultry, dairy, horticulture, and vegetable farming becoming available as options. Also, through better ‘watershed development’, farmers can improve the yield from their land holdings.

In Titariya village (Banka district, Bihar), Pradan’s Pranjal Saikia (a veterinary scientist from Assam) introduced us to the Village Watershed Committee (VWC). He has been working with the VWC to bring in a set of revolutionary innovations that are transforming waste land. Whether upland, mid-land, or low-lands, these districts have a lot of land rendered waste due to their inability to retain water for cultivation. In such a situation, innovations like ‘5% Method’, ’30 ft by 40 ft’, ‘Staggered trench’, and ‘Drip Dams’ now enable farmers to prevent soil erosion and retain water. The outcomes are unbelievable – a 2nd paddy crop; mango, lemon and papaya cultivation.

Birma Devi animatedly described her ambitions for her two sons who have studied upto Inter and Matriculation respectively. She wants one of them to become a teacher, and the other a politician. Listening to her, it’s hard to believe that, just ten years ago, hers was a family where they had hardly enough food for even six months in a year. But, for 10,000 families in Jharkhand, and many more in neighboring states of Central India, the silent Tasar revolution has offered new hope.
The efforts of NGO Pradan (along with its sister organization, Masuta) now account for as much as 15% of India’s Tasar yarn production. Their vertically-integrated Tasar strategy covers everything from rearing (of tasar cocoons), to reeling (producing yarn from tasar cocoons), and finally, weaving.
Hari is one of the 12 farmers in Sadalpur village who took the step towards Tasar rearing after hearing from Pradan and others that he could earn upto Rs 15,000/- additional income. It was exhilarating to walk through the 70 acres of ‘netted’ greenery in this village where 65,000 ‘Arjuna’ plants host the Tasar cocoons. (The nets prevent damage to plants, and protect from birds of prey).

We next drove to nearby Raksha village where a group of 30 women have formed a ‘Mutual Benefit Trust’ (MBT) to produce tasar yarn, from the cocoons. This is where Birma Devi works. While she and other women are at work, their small children are looked after at an on-premise crèche. The kids even sang and danced for our benefit!
There are almost 2000 such yarn producers in all.

Madhabananda Ray, the Chief Executive of Masuta points out that this Pradan/Masuta model allows 53% of added-value to be retained by the actual producers, unlike the traditional model where only 25% was possible, after cocoon and finished-goods traders had taken away the lion’s share. Also, apart from the sheer quantity of jobs created, there is also the qualitative, social dimension – tasar offers a dignified job opportunity for marginalized groups like women and landless farmers without being exploitative.
The Tasar revolution can only be the beginning of something much bigger. If everyone has to earn a livelihood, NGOs like Pradan need to keep innovating. In Madhab’s words, “we need a Bell Labs of livelihood innovation”

Satyabrata Acharya has one of the most important jobs in India. As Programme Director, Jharkhand for NGO Pradan, he leads 12 teams who are responsible for guiding over 100,000 families out of poverty.
Dhrubaa Mukhopadhyaya heads one of these teams. When, after graduating with an M.Phil from Jadavpur University, she joined Pradan in 1995, her teachers and classmates thought she was nuts! Today, she and her team of Executives, Subject Matter Specialists (SMS), and Development Apprentices work with 250 villages in two districts of Jharkhand and Bihar- helping them improve their land condition, increase agricultural productivity, and explore additional livelihood options.

Sericulture expert, Prabhati, and Development Apprentices, Meena (Patna University,’07) & Bhavna (BHU,’07) are three young ladies roughing it out in the villages. Working as part of Dhrubaa’s tight-knit team, they display a passion that is hard to find in urban centers today. I witnessed Prabhati and Meena training villagers to produce Tasar cocoon, while Bhavna sang & danced with tribal kids at a mobile crèche being run by Pradan at village Raksha( while the mothers were busy at the Tasar reeling centre).

Having been a spectator to the HR mayhem in metros and mini-metros, where youngsters driven purely by material gains, accept and leave jobs every six months, it was something else to see this young Pradan brigade in action.
Pradan carefully hires and nurtures this young talent. Sujata Nath, the talented HR Executive who traveled with me on my field visit, filled me in on the details of the intensive 12-month apprenticeship that all Pradan hires go through. But, as Pradan scales up its operations to meet its Vision 2017(of working with 1.5 mn poor families), it needs as many as 100 teams(= 800 people) across the country. For Pradan’s HR Director, Nivedita Narain, this is the real HR challenge. On the one hand, Pradan needs to hire such large numbers; on the other hand, retaining this trained and committed team is an equally big challenge. As these executives reach their late-20s or early-30s, and have families, they feel the need to move to an urban centre, in order to get better housing and education.
One way to overcome this hiring challenge is for Corporates to collaborate with large NGOs like Pradan. 4 to 6 years of Pradan training produces some of the best managers who understand rural markets; for corporates addressing mass markets, this could be a boon. By working together with corporates, Pradan could continue to hire the best youngsters, while offering them a road-map (to a corporate career) after 4-6 years.
Are companies like ICICI, Unilever, Asian Paints, and Mahindra’s ready?

When my friend, Anita Lobo, whom I caught up with after several years, told me that she was now working on social development projects using Sport as a medium of change, I didn’t quite believe her. I almost dismissed it as a PR spiel.

After all, apart from a few corporates like TATAs, who’re supporting athletes from weaker sections of the society, the “sports-based social inclusion” model is not used in India. (In Africa, on the other hand, the sports based inclusion model is gaining acceptance, with football and athletics being the chosen mediums).
But, as we continued chatting, and she gave me more details, it was intriguing. Spring Sport & Sustainability (a JV between Spring Worldwide & Perfect Relations Limited) is purely focused on community development, via Sport. In doing so, they involve corporate partners, who step in with time, effort and resources.

The first such experiment, titled ‘GOAL’, was rolled out in the relatively-underprivileged communities of Govindpuri, Aligaon and Sanjay Gandhi Camp, in Delhi. Multiple stakeholders collaborated in this project- NGOs (Naz, Deepalaya, Prerna and FXB); Netball Federation of India; schools and colleges; and Standard Chartered Bank.

70 girls were enrolled in the program, which entailed a 45-hour modular training course covering 3 broad areas of communication, wellness and entrepreneurship, including financial literacy. The girls also received professionally coached Netball sessions once a week. There were scholarships for meritious girls. What however, acted as a major impetus was the fact that the budding Netball team had a chance to qualify & become part of the national team.

38 Standard Chartered executives contributed their time and skills to the success of GOAL by designing the modules on Environment, Communication and Financial Literacy. 

Anjali Gopalan of Naz Foundation is excited about the program’s success. “We wanted the girls to have fun as they learnt. Our focus was to get them out of their shell & make them independent, confident individuals.  When the girls first came in they wouldn’t even lift their heads & now they play as if the world outside doesn’t exist.  They now conduct conversations with confidence”
 
An important indicator of success is the retention rate. An 80% retention was achieved, a very difficult proposition in any sustainable community development.  It has obviously struck a deep chord somewhere. A community elder and father of a girl who plays in the Aligaon netball team admits, “My daughter has changed for the better. When this program started, I wasn’t sure if it will actually work. Now I am sure that her life will be much better than I thought.” [Uska jeevan aur bhi sukhi hoga]

Standard Chartered Bank is committed to supporting this initiative, and plans to extend to Mumbai and Chennai by end of this year. 

Anita is passionate about this whole tri-partite approach involving poor communities, Sport, and companies. I completely agree with her, and eagerly look forward to integrate her ideas into the Growth-for-All movement.

Economic Times has recently recognized Dr S.S Badrinath, the founder of Sankara Nethralaya as its ‘Corporate Citizen of the Year’. While the achievements of this wonderful institution are truly creditable, what struck me most in the ET feature( ” The Modest Doctor with a Great Vision“) was the ‘business model’ that was described.

On the one hand, India has a third of all blind people in the world, and mostly poor. Coupled with the fact that we also have the largest number of diabetics,  eye care is truly a challenge, which needs the best of talent and equipment. On the other hand, early prescription and use of corrective glasses is often all that is required; around 6-7% of blind people in India are that way because they do not use corrective glasses!

Sankara Nethralaya’s business model is a self-sustaining one. Poor, needy patients get free treatment, while the richer ones pay( an important fact being that treatment is of such high quality that even well-to-do patients aspire to get treated here). So, the rich subsidize the poor. The institution accepts donations for capital investments — especially equipment which is costly and has to be imported.

ET reports that this ‘business model’ has enabled Sankara Nethralaya to today employ over 1,200 people, treat 1,500 patients daily, and perform over 125 surgeries a day. About 50% of the consultations and 40% of the surgeries are done free of cost.

Can other hospitals replicate this unique, self-sustaining model, where the poor get affordable treatment and the rich get quality-care, across all aspects of healthcare? Why just healthcare? What about education? Housing?

CSR at work!

The last one week has seen an unusual amount of public debate, involving leading CEOs and others, about the kind of corporate social responsibility that makes sense for them.

While reporting on the Leadership Summit 2007, HT covered the views of Infosys’ Nandan Nilekani, and Unilever’s Harish Manwani. Nilekani, a leading philanthropist in his personal capacity, believes that corporates have limited ability to spend on CSR given the need to protect shareholder interests. Hence, he asserts that promoters and corporate honchos must do more in their personal capacity. An interesting viewpoint, but one that begs an argument. First, companies will build a foundation for future revenue growth by investing in the economic development, and thereby increasing the purchasing power of a large section of the Indian population. High revenue growths cannot be sustained by focusing on urban and middle-class markets alone. Next, companies need to build bridges with all sections of the Indian population in order to ensure that they don’t face a backlash, as corporate retailers currently are. It is, therefore, in the shareholders’ interests to support CSR investments. If presented correctly, they are likely to reward companies for CSR, as they have done for corporate governance, in the past. And, yes, of course, company promoters( who have a lot of money) and corporate honchos( who may not have as much) must also do their bit.

Harish Manwani’s view is that CSR, to be sustainable, must have a related business benefit also. For instance, Hindustan Unilever’s Project Shakti has enabled over 30,000 underprivileged women to earn Rs 1000/-+ p.m, by becoming sales entrepreneurs. So, while people get livelihoods, HUL expands its rural distribution and sales. Similarly, through its ‘Hand-wash Awareness’ campaign, HUL promotes hygiene, but there is an indirect benefit for brand Lifebuoy. (Similarly, I know that L&T offers vocational training to rural youth, and in the process, ensures that it has a ready workforce for its booming construction business, where talent is in short supply).

This point-of-view is perfectly logical, but it throws up several intriguing issues. For one, where do you draw a line? For instance, should one support a sales promotion where a company promises Rs ‘x’, per unit sold, to a social cause? Or, what about Posco’s sudden espousal of CSR when it faces a huge backlash on land acquisition? So, while companies like HUL may commit to CSR with all sincerity, there may be a nagging suspicion in some quarters, on account of the perceived business benefits. For instance, during my recent visit to Jharkand, an NGO told me that they had turned down an offer to be an alliance partner for Project Shakti, for precisely these reasons.

Unfortunately, there are no easy answers.

While we are groping for answers, there comes along an interesting newsitem in today’s Economic Times, about Nachiket Mor moving from ICICI Bank, to ICICI Foundation. The important part of the story was the likely commitment from ICICI Bank, to spend 1% of net profits on issues relating to inclusive growth. Now, that is an interesting development!

I have been debating the “right amount of spend” issue with several people, including at a corporate panel discussion that I was part of, yesterday. I think 1% is absolutely perfect: it is a figure that shareholders will support, and will make an impact. The important thing about this spend is the multiplier effect it has, on actual economic activity. During my recent trip to Jharkand, with Pradan, I was astounded to find that a Rs 1/- spend enables villagers to raise Rs 10/- from government grants or loans; and each rupee they raise generates economic activity worth Rs 10/-. So, the overall multiplier effect is 1:100 !

A final observation on how corporates execute CSR. Some, like Dr Reddy’s Foundation and Bharti Foundation, have set up their own, large teams, whereas others work with existing NGOs.  The former is not scaleable, and will raise questions about overheads, headcount, etc. Whereas, working with existing NGOs represents a long-term, low-cost option. There are literally a million NGOS in India, and many of them are extremely sincere, but desperately need financial support. This could be a win-win relationship for both. ( See an interesting article ‘The Silent Army’ in Economics Times)