Developmental economist Muhammad Yunus, the 2006 Nobel Peace Prize Laureate, last Friday delivered this year's Dean's Lecture titled "Social Business Can Address Pressing Social Problems."
Dean of Academic Affairs for Arts and Sciences James Glaser and University President Anthony Monaco welcomed Yunus to campus during the event held in Cohen Auditorium. Monaco introduced Yunus as the father of microcredit and the world's banker to the poor and showed a clip from the documentary "To Catch a Dollar: Muhammad Yunus Banks on America" by filmmaker Gayle Ferraro.
"[Yunus] founded the Grameen Bank in Bangladesh in 1976 to help clients establish creditworthiness, learn sound financial principles and achieve financial self?sufficiency," Monaco said.
Monaco noted that Yunus was recently named one of Fortune Magazine's "12 Greatest Entrepreneurs of Our Time."
Yunus opened his speech by stating that his success with Grameen Bank and his pioneering of the concept of microcredit was not the result of intelligence because the idea came easily to him.
"I did something which was the product of a terrible situation in Bangladesh at the time. When I did that it was out of desperation. You do something you don't think about, you just jump," he said. "It was easy because I was so close to the people."
"My ambition was very simple," he said. "All I wanted to do was to see if I could make myself useful to at least one person, even for a day."
Yunus said he discovered the existence of loan sharking in Bangladesh and wanted to understand it better. He noted he was shocked that people have to suffer for borrowing small amounts of money. Helping people pay off the loan sharks generated a positive reaction in Bangladesh, according to Yunus.
"The thought came to my mind, if you can make people so happy, why shouldn't you do more of it?" he said. "And that was the beginning of the whole thing."
Over a period of about 10 months, Yunus said he worked with banks to take out loans for other people who needed them. He eventually became a primary guarantor and founded the Grameen Bank with simple rules and procedures for lending money.
"Whatever conventional banks do, I do the opposite. That's why I said it's not a smart thing, I don't think, you just look at it and do the opposite. Anybody can do that," Yunus said. "You know, if you do the opposite things, something happens which never happened before. And that's exactly what happened in my case. Microcredit was born."
Yunus said Grameen Bank trains its staff to find borrowers who are hesitant to take out loans. He said these people are ideal candidates.
"Conventional banks want collateral. We reverse it. The less you have, the more attractive. If you have nothing, we are delighted to find you," Yunus said.
Yunus referred to the bank as a trust?based bank with 8.4 million borrowers today, 97 percent of which are women.
"The bank is owned by the borrowers. It is their bank. They own it," he said. "There is a poor woman who sits on the board of one of the largest banks in the country, so that's a very interesting board and they decide the policy of the bank."
Every branch of the Grameen Bank is self?sufficient, according to Yunus. The bank does not take money from the government, donors or outside organizations. The bank takes deposits and lends the deposit money, which totals around $1.5 billion every year, he said.
According to Yunus, the majority of women customers at his bank are illiterate. He aims to break the cycle of illiteracy for future generations by providing education to all customers' children.
"We want to take them all to school and remain in school," Yunus said. "Getting to school is easy, but keeping them there is difficult. But we wanted to do that, and we did that. As a result we created a whole generation that is going through the school system."
Yunus explained that he hopes to give people a chance to change their own life. He added his belief that poverty is not created by poor people, but is rather imposed on them.
"A Bonsai tree doesn't grow because it doesn't have the space to grow," he said. "The poor are Bonsai people; there's nothing wrong with their seed, simply society never gave them the space to grow as tall as everybody else."
Yunus said he is uncomfortable with the economic framework of business. His goal is to bring selflessness to business and create social businesses that solve problems that make people suffer.
"Human beings can make money as a means, but it doesn't make sense to make money as an end," he said. "Human beings are selfish. You built the whole economic theory on the basis of selfishness. You've forgotten that human beings are also selfless beings, equally selfless. But you did not accommodate that selflessness into the economic theory."
Yunus has created more than 50 social businesses, including a solar energy company to bring solar home systems to Bangladesh, where 70 percent of the people live without electricity. He said he also created a special yogurt that incorporates micronutrients to address the problem of malnutrition in children of Bangladesh.
"Whenever I see a problem, my instinctive response is to come up with a business solution," he said. "I'm kind of a serial company maker."
Yunus said he has no intention of making money and does not own a single share in any of his companies. He stressed that people can create what they want and that anyone can start a social business because human beings have unlimited creativity.
"The distance between possible and impossible is shrinking. If it is shrinking, then let's go for the impossible," Yunus said. "The impossible is the exciting thing for the future. Let's go for it and make it happen."
