By Christopher Frey
This article was originally published in February 2009.
On the sweltering shores of Lake Turkana in Kenya, there is a frozen fish plant that never shipped a single fillet. In the early 1970s, a Norwegian aid agency noticed that the lake was flush with perch and tilapia, and local anglers made brisk trade of the fish they caught. For the area’s Turkana – nomadic cattle herders perpetually beset by drought, loss of grassland and an inattentive government – the aid agency contrived a solution: The Turkana could become fishermen.
Kids in the village of Bongo hanging out at the communal water cooler.
The Norwegians, a fishing culture, were smitten with the idea. Technical advisers were hired, research trips enjoined, studies commissioned, boats donated. The Norwegians enticed some 20,000 Turkana to settle at the lake’s shorelines and trained them to fish. The imported expertise further decided that processing frozen fillets – what today is called value-added – would be the most profitable cornerstone for this new enterprise.
Over the next 10 years, the Norwegians invested more than $20 million in the project, a price that included construction of ice fabrication and cold storage facilities and a highway to Nairobi. But when the plant finally opened in 1981, a sharp truth quickly became apparent: the cost of fuelling the diesel-powered cooling equipment in the scorching Sahelian heat made the frozen fish plant unprofitable.
The plant was only open for a few days, then it closed for good. Drought soon diminished prime fishing spots to dry lakebed, and because such large numbers of Turkana had moved to shoreline, much of the surrounding grassland was ruinously overgrazed by their herds. Many Turkana became dependent on food aid. An elaborate, expensive and well-intentioned scheme had made them poorer and disconnected from their traditional way of life.
I was reminded of the fish plant story while driving around the northern reaches of Ghana with Rex Asanga, a local agriculture adviser and project co-ordinator. This train of thought was momentarily disrupted by the sight of a dead pig strapped to the back of a motorbike that was still evacuating its bladder. But then Asanga lifted his hands from the steering wheel to gesture towards another seemingly deserted dirt road that led to another abandoned development project.
From Tamale to Bolgatanga, Bongo to Bawku, I had seen the signs: placards at roadsides bearing the iconic logos of non-governmental organizations (NGOs) and various foreign development agencies. After a while these signs, paint peeling, almost illegible, begin to look like tomb markers in a sprawling graveyard of good intentions.
Since the late 1970s, Asanga had seen all manner of projects arrive ballyhooed then shuffle off with hardly a handshake goodbye. Each had different goals, and boasted a different technological intervention and modus operandi. Some were modest, say, a rainwater retention pool to improve irrigation; others were almost as ambitious as the Lake Turkana fish plant. Some even began to show returns, according to Asanga, but often the donor country or organization’s priorities changed, or it was decided prematurely to pull staff and replicate the initiative’s success elsewhere.
“When I think of how much has been done, how much money spent and how little there is to show for it,” Asanga said. “In the end, food production yields are no higher, and food security is not much better.”
Asanga had learned there was always another bright new idea around the corner. Now a movement of self-described doers in Great Britain and North America had arrived on the Third World development scene. Going by the handle of social entrepreneurs, they claim to have learned from the failures of the past, and profess to be unbound by convention or bureaucracy. As former eBay president-turned-social entrepreneur Jeffrey Skoll put it in 2007 at his annual Skoll World Forum, social entrepreneurs use many of the tools and techniques of business. “Their work,” said the Montreal-born philanthropist, “is characterized by innovation, leverage, empowerment and lasting change.” Social entrepreneurship will, its supporters believe, rewrite the rules of foreign aid, helping to foster economic opportunity and material progress instead of simply providing handouts. Or, at least, this is its promise.
Calgary-native Mike Quinn travelled many of these same Ghanaian roads five years before me. A self-described “disgruntled engineering student,” Quinn had just graduated from the University of British Columbia but felt little enthusiasm for the career that awaited him.
Eager to start fresh but put his degree to some use, he accepted a one-year placement in Ghana financed by the Canadian International Development Agency (CIDA), and signed on to an Engineers Without Borders-supported project that hoped to improve access to electricity in rural communities. The initiative was conceived to promote and implement a simple but dexterous technology – the Multifunctional Platform (MFP), a small diesel engine that can simultaneously power a roster of agricultural processing equipment, including a rice dehusker, a corn mill and an oil press. Around 80 per cent of people in rural Ghana lack a stable energy supply; the machine would hopefully increase incomes by diversifying agricultural production and reducing the time women spend on manual labour.
Quinn was emotionally invested in the project. But, after a year abroad, he was critical of aid programs and the pitfalls of designing interventions for Third World communities in faraway donor countries. When we crossed paths again a few years later, I was struck by how much his experience in the development field, and the evolution of his thinking on it, encapsulated the major trends and debates happening in the aid sector, including the emergence of social entrepreneurship.
Left: Bolgatanga’s market. Middle: After school, girls sow groundnuts and sing worksongs. Many songs, the writer was told, boast a similar message – men are lazy, drink too much and are not good for much at all. Right: Fertilizer spray packs for distribution at an “input fair” in the town of Sandema. Villagers from the surrounding area arrive on tractors or on foot to get free agricultural tools, often donated by CARE International.
While his tenure in Ghana was part of a more traditional development model, it introduced him to the man he considers his mentor, Abeeku Brew-Hammond, a Ghanaian energy expert charged with rolling out the MFP program. “You meet a lot of cynical people in the aid sector, but Abeeku was unique,” Quinn said. “He taught me about the perils of dependency and how strongly the market could motivate people. He taught me to think like an entrepreneur.”
What Quinn learned from Brew-Hammond pushed him closer to the burgeoning notion of social enterprise: market-oriented businesses intended to meet broader social and environmental needs. These were businesses concerned as much with social and environmental as with fiscal dividends, but run as prudently as any profit-making enterprise.
It didn’t take long for Quinn to head back into the field after his Ghana placement. An internship at an engineering firm in Vancouver was fruitless (he developed a habit of not showing up at a work), and so, again under the auspices of Engineers Without Borders, he lighted out for Africa, this time to Zambia. There he would lead a sorghum commercialization project for small-scale farmers.
Sorghum, a drought-tolerant cereal grain, wasn’t grown much in Zambia, but it was perfect for the country’s arid environment. Crucially, SABMiller, one of the world’s largest brewers, had signed an agreement with the federal government to garner tax benefits if it bought sorghum locally. With a major buyer guaranteed, Quinn spent 10 months riding around Zambia on a motorbike, working with farmers to produce more sorghum and organizing the two co-ops that consolidated the crop and trucked it to the SAB plant in Lusaka.
“I had seen the traditional NGO model, which was to work with farmers directly, get them to grow stuff, then figure out how to market it afterward,” Quinn said. A big company like SABMiller, though, could make an enormous impact. “They weren’t even directly involved; they were just a purchaser. But they created a stable market opportunity and earning incentive that the aid agencies weren’t able to.”
Still, he witnessed how conventional aid models operating in the same environment could undermine long-term viability. “Distributing food aid created a perverse incentive that discouraged farmers from changing their behaviour to adopt more sustainable livelihoods,” Quinn recalled. “My project was market-led and aimed at getting farmers to diversify away from maize – the dominant crop that is becoming much less viable in southern Africa because of climate change. But, at the same time, one organization was distributing food aid, including maize, to these same farmers. It discouraged many farmers from doing anything different. They would continue to plant their maize in the same way and, if it failed, they would sign up for food aid.”
Despite the challenges, the sorghum project brought in a small profit.
“It was suddenly a pretty exciting time in what could be destitute places. The price was good and the farmers were convinced that this was a real market opportunity,” says Quinn.
Then a common problem afflicting NGOs started to happen to the sorghum project. “As soon as something does appear to go well, NGOs want to replicate it somewhere else. Resources end up getting shifted away from the original success,” Quinn said. “But you forget it’s only been one year. When I went back later to my project area, they were still planting sorghum and selling it, but all the excitement was gone. The project had topped off. I wonder how different it could’ve been if there was a social entrepreneur still there, someone with a vested interest that could’ve built on the business.”
While social entrepreneurship isn’t new – the term has been around since the 1960s – the popularity it now enjoys is recent. Leaders hold up Florence Nightingale, Margaret Sanger, Mahatma Gandhi and Helen Keller as icons. Today’s movement is very much a product of globalization and the whirligig of money that made so many millionaires and billionaires in the 1990s and early 2000s – especially the ones who made their hay in the bubbling financial, real estate development, high-tech and media sectors.
With unprecedented wealth, newly minted “philanthro-capitalists” are seeking to use their social and financial capital to leverage change in the developing world. (Given their business backgrounds, leverage has become a buzzword in the movement.) Moguls like CNN founder Ted Turner, Microsoft’s Bill Gates and Jeffrey Skoll (who established the Skoll Centre for Social Entrepreneurship at Oxford University) ushered in a new era in fundraising and social action, raising an estimated $30 billion.
Gary McPherson at the Centre for Social Entrepreneurship points to the professions that should lead the way in social entrepreneurship.01. Accounting
02. Business (especially the oil and gas sector)
03. Engineering
04. Law
05. Politics
By professing to be market-oriented, and therefore demand-driven, people like Skoll argue that social entrepreneurship sidesteps the chronic problem of donor accountability, in which aid recipients are given too little say in the projects designed for their benefit. As entrepreneurs, the philanthro-capitalists insist that their projects are more immediately responsive and less burdened by government or organizational bureaucracies. Constantly measuring their impact, they strive to be as results-oriented as any business. If something doesn’t work, they can adapt quickly to local realities and changing times. They are also, they say, more willing to experiment with untried approaches and new technologies – from mobile phones to vaccines to biotech crops.
Former management consultant Bill Drayton is one of the field’s intellectual progenitors. Drayton, who founded the Ashoka Foundation, funnels money into a diverse array of projects and, until the recent stock market meltdown, was managing a social investment portfolio o f$40 million. Frequently summoned to explain the movement, he talks as though it is largely an effort by social activists to speak the language of Wall Street. “[The word] entrepreneur has nothing to do with government bureaucracies, or any bureaucracies,” Drayton said in an interview on CBC Radio One. “The [traditional] business entrepreneur and the social entrepreneur have so much more in common with one another than they do within the routine structures of their own industry or sector.”
Drayton would maintain, of course, that it’s about far more than nomenclature, that social entrepreneurs are able to achieve more than government, and that government and transnational institutions like the United Nations should limit themselves to supporting roles.
This is already happening. Money pouring into the aid sector from private groups like the Bill and Melinda Gates Foundation is redrawing the power dynamic among the leading players. With yearly disbursements of more than $2 billion, the Gates Foundation’s resources alone outstrip those of the World Health Organization, whose total annual operating budget (including admin costs) tops out at just less than $1 billion. When the Gates Foundation commits to a project, it tends to draw public money in its wake. Is accountability resolved though, especially when a few moneyed individuals garner more power to make policy decisions with global impact?
Quinn returned from Zambia a full convert to social entrepreneurship; he just hadn’t heard the term yet. Only when a friend mentioned a new MBA program in social entrepreneurship at Oxford University’s Saïd Business School did Quinn realize he was part of something larger. He applied for a Skoll Scholarship and soon found himself at Oxford.
One of the thinkers who featured most prominently in Quinn’s studies was the controversial American economist William Easterly, best known for his criticism of Jeffrey Sachs and celebrity-fronted campaigns such as Make Poverty History. Easterly says too much of what passes for development, like the Lake Turkana fish plant, are futile top-down exercises driven not by local demand but by donors; they come with political strings attached, require too much capital and rely too heavily on foreign expertise, inputs and technology.
Most importantly, the model fails to recognize how economic growth and poverty reduction are best enabled. Easterly pointed to Asian countries that have benefitted from tremendous growth in the past 50 years, mainly as a result of homegrown economic policies and innovations. He’s not the first economist to contrast the trajectories of Ghana and South Korea: in 1957, when Ghana was on the verge of becoming the first independent sub-Saharan African country, they had almost equal per-capita incomes; 50 years later, South Koreans had 10 times the purchasing power of Ghanaians, despite being significantly less endowed with natural resources.
In The White Man’s Burden, an ironic nod to Rudyard Kipling’s Eurocentric poem of the same name, Easterly differentiates between Planners and Searchers. The Planners conceive and implement expensive, largely technocratic solutions from abroad. Such solutions typically have inadequate local consultation, and little accountability. Easterly doesn’t disguise whom he’s talking about – by Planners he means the policy wonks that populate the major international aid agencies and NGOs.
Then there are the Searchers: flexible, innovative, market-friendly folks, free from the inertia of bureaucracies, who are intent on piecemeal solutions that breed noticeable results and not grand, utopian designs.
Social entrepreneurs surely like to think of themselves as Searchers. But from his office at New York University, the genial and soft-spoken Easterly warned against taking their claims at face value, saying, “Just because someone uses a fashionable new label doesn’t mean they’re necessarily doing anything useful, constructive or even novel.”
“The question with social entrepreneurship is whether there is a bottom line. Is someone applying a market test or voter test to what social enterprises are doing? Some clearly pass the test, like Nobel Prize winner Muhammad Yunus and Grameen Bank’s micro-credit financing. He invented something poor people seem to find very useful because we can see there’s a demand for it,” Easterly said.
Left: After a raga of singing and dancing, a Konkwa elder gives the writer a what for. Middle: Left-over food aid in a Bolgatanga storeroom. Right: Kids lugging water back from the communal well through a tall thicket of early millet.“Development can’t be about whether a project or aid agency attains its objective, but whether we assist the poor in meeting theirs.”
Now that Quinn is at the hub of the social entrepreneurship scene, he is beginning to question these same things. How different is it really from traditional aid agencies, which have long tried to quantify their effectiveness? True development, he has learned, eludes easy measurement.
The distinctions between one brand of development or another are often lost on the people that aid is directed toward. During my travels in the developing world, I’ve often felt like a one-man complaints department, recording the frustration of communities that, while grateful for assistance, still speak of many of the same shortcomings in aid delivery they always have.
In Ghana, I looked up Quinn’s mentor, Abeeku Brew-Hammond, now dean of mechanical and agricultural engineering at Kwame Nkrumah University of Science and Technology (KNUST) in Kumasi. The pragmatic, 52-year-old Brew-Hammond didn’t conceal his conflicted attitude toward the developing sector’s changing regime.
He welcomed more engagement with the private sector, the kind that social entrepreneurship embodies, especially when it came to priorities like the provision of accessible electricity – the lack of which has long-hindered Africa’s development.
Yet he’s seen this push for private involvement taken to ideological extremes. Before joining KNUST, Brew-Hammond was a director at the NGO-backed Global Village Energy Partnerships (GVEP), where he worked with governments in Africa and the Americas to develop national energy access plans. After only a year on the job, some countries had submitted their strategies while others were in the pipeline. Then one day a new chairman arrived, a chairman who, according to Brew-Hammond, “believed everything public was a waste of time.” The work was scrapped. “I hate it whenever we just start to get our act together, the donor’s ideas change and we’re forced to move on to something else,” he told me.
Attention Deficit Disorder seems to particularly afflict the newer models of entrepreneur-led development. Social enterprises tend to fetishize technological innovation and novelty. “Donor ideas now have a short lifespan,” Brew-Hammond said. “But a lot of societies and institutions in the developing world take time to soak in new ideas, build capacity and operate effectively.”
There can also be bizarre, wholesale changes that spread resources too thin and cut short promising work. I have seen groups in Guyana and Guatemala pulled away from their main expertise or mandate to work in another area simply because that’s where the money is at the moment. Maybe five years ago the money was there for AIDS/HIV prevention, last year it was poverty reduction and this year it’s for climate change.
Not only that, but supposedly cutting-edge projects often distort local priorities. Some agronomists in Ghana put it to me this way: They have a list of 10 key projects, all designed to improve agricultural output and food security, but ranked in order of importance and potential impact. Their thinking is backed by experience on the ground. Potential donors, however, might request proposals to finance what are only the Ghanaians’ fifth or sixth priorities. The agronomists go after that money anyway because they’re already underfunded; they’ll take what they can get.
Brew-Hammond believes local grassroots organizations in developing countries could best generate the kind of anarchic, piecemeal bottom-up economic activity that produces sustained results. “You know, some old ideas aren’t bad ideas, they just need time to work,” Brew-Hammond said. “You’ll go to a conference, make a suggestion and someone will say back at you, ‘Oh, that’s nothing new.’ So what? I didn’t come here to say something new; I came here to say what I think will work in my country.”
The last time Quinn and I spoke, we discussed how the current economic crisis was affecting social entrepreneurship, especially considering how much of the money at its disposal was made in a financial system that is now imploding. A director at one prominent foundation estimates that U.S. foundations have slashed their budgets by an average of 30 to 40 per cent; Google.org, the company’s philanthropic arm, has cut its annual disbursements by almost 50 per cent.
For better or worse, Quinn has committed himself to social enterprise. While finishing his studies at Oxford, he hatched a small business incubator called African Enterprise Partners. A U.K.-based fund has already hired him to find and manage investment opportunities in Zambia (for which he will retain an equity share).
What’s most encouraging about the emergence of social entrepreneurship is the debate it has fostered on development strategies and how we allocate our resources for aid. Expertise garnered in the private sector or at business school can bring fresh thinking to an old topic. Quinn doubts, however, that social entrepreneurship will usher in the kind of transformative change it promises. “It is in danger of passing itself off as the whole solution,” he says. Technologic and programmatic schemes, from micro-loans to hybrid seeds, will not alone end unfair land distribution policies, income disparity, social conflict and ethnic discrimination that are often the source of poverty.
Social entrepreneurship is a surprisingly apolitical animal at times, and its lack of regard for the role civil society organizations have historically played in fomenting social change is an odd blind spot for a movement that lionizes icons like Gandhi and Martin Luther King.
The phenomenon may be more a symptom of economic inequalities than a cure. It exists because of the vast fortunes made in an era of high CEO remittances, the widening income disparity between employees and executives and the inflated value of big corporations. “People on the social entrepreneurship side are often guilty of thinking they have the answer,” Quinn said, “as opposed to improving on a defunct system. They’re sometimes guilty of not partnering with civil society or trying to improve on what’s been done before.” U
Christopher Frey wrote this article with the support of the Government of Canada through the Canadian International Development Agency.
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Lake turkana kenya.