World Video | Defence | Foreign Affairs | Natural Events | Trade | NZ in World News | NZ National News Video | NZ Regional News | Search

 


Evaluating for-profit poverty projects in India

26th March 2013

Fighting poverty and making a profit, Business School to evaluate the results

The University of Sydney Business School is studying the commercial and moral implications of projects in India which aim to turn poverty alleviation for the nation’s poorest people into profit making ventures.

Microfinance projects which charge relatively high interest rates have in recent years targeted thousands of people at the bottom of India’s socioeconomic ladder.

“For a very long time, poverty alleviation through microfinance has been the domain of not-for-profits, governments and huge multilateral organisations like the World Bank,” says Business School Researcher, Dr Ranjit Voola. “Now may be the time for business to also get involved in return for a profit.”

Not-for-profit organisations have traditionally provided credit to people, often women, who are too poor to qualify for traditional bank finance. These small amounts of money are usually invested in small scale by sustainable village level enterprises.

“Unfortunately, these microfinance projects sometimes fail because lending organisations lack the profit incentive to continue with them,” said Dr Voola.

The profit making projects in India to be audited by Dr Voola and his team, have loaned money to about a thousand women wanting to invest in small scale dairying, village level retail businesses, goats, food stalls and range of other ventures.

The goal is to ensure long term income, health and food security for the women and their families.

“While these seem to be an admirable goal, we want to take a step back and look at whether this is the right criteria for success,” Dr Voola said. “We want to know if the profit motive really does have a role in poverty alleviation or are these very poor people simply being exploited.”

“At the end of the day, we may find that profitability holds the key to the grinding poverty that affects nearly half of the world’s population,” he concluded. “Perhaps it is possible to make a profit and go to heaven.” The notion that businesses are important in combating chronic poverty is recognized by Tim Costello, CEO of World Vision.

“We will not succeed in eradicating chronic poverty unless business joins the fight,” says Mr Costello. It has a critical role to play in lifting 2.6 billion people, or 40 per cent of the world's population, out of poverty.”

Dr. Voola is the Director of The Poverty Alleviation and Profitability Research Group which has been formed within the Business School to manage various research projects aimed at understanding the challenges of profitable and poverty alleviation here in Australia and around the world. The Group includes academics with expertise in marketing, human resources, business information systems, accounting, international business, education and social policy

The Group also includes internationally recognised experts in the field of poverty alleviation and business, Jaideep Prabhu, who is the Jawaharlal Nehru Professor of Indian Business & Enterprise at Cambridge University’s Judge Business School and Mushfiq Mobark, Associate Professor of Economics, School of Management, Yale University

ENDS

© Scoop Media

 
 
 
 
 
World Headlines

 

Leaked: UK Counter-Terrorism Training Material

The PREVENT Strategy has permeated all aspects of public life in the UK. It is important that the training provided to public sector workers to implement the strategy is scrutinised for its empiricism. To this end, CAGE has released the most comprehensive leak of PREVENT training material so far. More>>

ALSO:

Weather: Aid Urgently Needed For Drought-Stricken Ethiopia

As the severity of ongoing drought in Ethiopia is exacerbated by the arid effects of ‘super El Nino’, ChildFund New Zealand is appealing to more New Zealanders to contribute to their growing aid response. More>>

'Very Concerned' After Court Ruling: UNHRC On Transfer Of 267 People From Australia To Nauru

Most of these people were reportedly brought to Australia from Nauru to receive medical treatment and are in a fragile physical and mental state. The group includes more than 12 women and at least one child who have allegedly suffered sexual assault or harassment while in Nauru. The group also includes 37 children born in Australia. More>>

ALSO:

Sanctions To Be Lifted: NZ Welcomes Implementation Of Iran Nuclear Deal

Duty Minister Nikki Kaye has welcomed the next stage in the historic nuclear deal between Iran, the Five Permanent (P5) members of the United Nations Security Council, and Germany... “New Zealand has now started the domestic process for removing the UN sanctions." More>>

ALSO:

Pre-Davos Reports: 62 People Own Same Wealth As Half The World

Runaway inequality has created a world where 62 people own as much wealth as the poorest half of the world’s population – a figure that has fallen from 388 just five years ago, according to an Oxfam report published today ahead of the annual gathering of the world’s financial and political elites in Davos.. More>>

ALSO:

Jakarta: UN Secretary-General On Attacks

The Secretary-General condemns the bombings and gun attacks in Jakarta today... there is absolutely no justification for such acts of terrorism. He hopes the perpetrators of today's attacks will be swiftly brought to justice. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
World
Search Scoop  
 
 
Powered by Vodafone
NZ independent news