If Businesses Can’t BOGO and NGOs Are Crushing Entrepreneurship, Where Does That Leave Us?

If you caught my poll earlier this week asking what areas you find meaningful in the cosmos of business and social responsibility, you know that I’ve been thinking hard about how to make the biggest impact.  On one hand, there’s the CSR approach, which I’ll generalize as reaching more people but having less direct impact on the recipient individual or cause; on the other hand, there’s the direct aid approach, which (hopefully) improves an individual’s life more than a cause marketing campaign, but affects and influences fewer people.

In my worldview, social enterprise lies somewhere in between. But there’s a lot of ‘in between’ to suss out, understand and test.  Not only do we work with fickle terminology, there’s also a dearth of insight into what works in the long-term.

R. Todd Johnson’s excellent piece, “Is Philanthropy Killing Africa” opens up gaping questions. Do we prioritize immediate solutions (which, in international development means saving lives) or long-term self-reliance for Africans?  Johnson questions whether NGO efforts and buy-one-give-one products like shoes, flashlights and computers, are killing the African economy and entrepreneur. He ratchets up the complexity level by bringing tax- and donor -subsidized products (such as water pumps) into question. The negative result of this approach (which isn’t even a pure charity as it still requires an individual to purchase the pump) is “killing the market for future indigenous entrepreneurs attempting to sell water pumps at a profit and locking a potentially valuable distribution channel in a non-profit, making it difficult for other for-profits to use,” in his view.

Johnson’s depiction is Escher-like. It’s hard to grab a hold of one sure thing and follow it to a solution. But with four billion people living without basic services…and consumers and companies who want to engage (yes, that’s a jump, but I feel strongly that it’s true and part of the solution)…we have to try.

Image credit: Jake Lyell Photography

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  1. Jeff Mowatt July 23, 2010 at 3:28 pm #

    That philanthropy is harmful to Africa should by now be a given for anyone who’s heard the Hippos vs Cheetahs pitch from George Ayittey:


    Cause driven business is what we both advocate and for me that’s about creating self sustain revenue flows within impoverished communities. Solicited recently for a suggestion as to how we might deploy $120 billion of savings looking for social investment opportunity, I offered this: