Archive for the ‘Business’ Category

Secretary Clinton reveals international development goals: focus on investment

January 8, 2010

Secretary Clinton focused on investment in international development as the U.S. administration’s 2010 mantra.

The approach is country-led investment with a focus on results. This isn’t a new idea, of course. Millenium Challenge Corporation has taken this successful approach for the past five years. 

Discussions between defense, diplomacy and development departments as well as development organizations led to decisions about approach to development. Or at least, the beginning stages of changes. Clinton’s speech on definitive changes, incidentally, evoked an encouraging  roar of applause from both the development agencies and heads of state departments present at for her speech at the Peterson Institute for International Economics  on January 6th.

“But through investment, we seek to break the cycle of dependence that aid can create by helping countries build their own institutions and their own capacity to deliver essential services. Aid chases need; investment chases opportunity,” said Secretary Clinton.

With a focus on results, international development programs will look to achieve five goals:

1. Partnership

Countries must demonstrate a commitment to development by practicing good governance, rooting out corruption, making financial contributions to development. Strong economic policies are also a prerequiste. Secretary Clinton cited two examples: levying taxes on those who can afford them and managing  natural resources sustainably and devoting some of the profits to people’s development.

Partnerships with other organizations also play an important role in international development. Some foundations are also combining philanthropy and capitalism through entrepreunerial programming such as Acumen Foundation. Private companies also play a valuable role in sustainable development, according to Secretary Clinton.

“A company like…Unilever/Hindustan, which has created soap and hygiene products that the very poor – long-overlooked by private business –can afford,” said Secretary Clinton.

2. Integrate development more closely with defense and diplomacy efforts

Intregated efforts between the three Ds of forien policy, (defense, diplomacy and development) is essential for success abroad, according to Secretary Clinton. The U.S. government can ” leverage the expertise of our diplomats and our military on behalf of (international) development (workers),” said Secretary Clinton.

3. Coordinate development across Washington,D.C.

A growing problem is the number of agencies broaden their scope internationally, adding  important expertise and capacity, and working the same developing issues from different angles. This creates overlap and contradiction between development efforts. 

As attracting investment and expanding trade are critical to development, the U.S. administration encourages coordination between development programs  (USAID, MCC, and other agencies) with the trade and investment initiatives (USTR, the U.S. Export-Import Bank, and the Overseas Private Investment Corporation).

Regional efforts are also being supported and recognized as examples of regional coordination like the Africa Growth and Opportunity Act.

Also, there is also an effort underway to bring contractor workers  back to work for government agencies. 

 “It is not financially sustainable, said Secretary Clinton. “We cannot continue to send so many dollars out the door with no monitoring, no evaluation, no accountability.”

By bringing contract workers back into government organizations, the return on the investment in human capital will be greater, according to Secretary Clinton.

4. Sectoral work

In the past, the U.S. worked in all areas possible for international development. The U.S. administration is taking a new approach. Investment and technical expertise of U.S. development agencieswill be focused on a few key sectors: health, agriculture, security, education, energy, and local governance.

“Rather than helping fewer people one project at a time, we can help countries activate broad, sustainable change,” said Secretary Clinton.

5. Technology

Through technology rural neighborhoods in developing nations can move decades ahead with just access to the internet and mobile phones.

Secretary Clinton cited farmers learning the latest local market prices and know in advance when a drought or a flood is on its way through mobile phones. Mobile banking gained access to savings accounts or money sent from overseas  through cell phones as well, according to Secretary Clinton. Activists used blogs and social networking sites to hold governments accountable for how they use resources and treat their citizens: an opportunity to raise transparency on corruption and repression in developing countries, said Secretary Clinton.

Secretary Clinton also mentioned that the sees expanding development programming coming State department, USAID, multi-lateral institutions such as World Bank and even stimulus money. She pointed out that the administration would “very much like to see (American technology) used” and supporting development programs is one way to creatively development American economy and help developing countries at once. The details of how this would work is still being considered. Clinton says  that as the Geneva Accord will be the subject of meetings throughout the year. She is hopeful that ideas such as American technologies use in developing countries might be a consideration.

6.  Investment on women and girls

Women and girls are critical to advancing a country’s social, economic, and political stance globally. Future development programs  with a focus on improve women’s health, income, and access to education and food.

Programming is in progress which focuses on women farmers, or women health educators to improve outreach to women and girls. Also, there is more discussion with partner countries to play a more central role in development work. Senator Clinton mentioned new scholarships  for female agricultural scientists in Kenya.

These goals mentioned above might be altered or adjusted according to the results of the inaugural Quadrennial Diplomacy and Development Review  (due to be completed in earl spring) and  The Presidential Study Directive on U.S. Global Development Policy.

For access to Clinton’s entire speech visit: http://www.state.gov/secretary/rm/2010/01/134838.htm

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TED:where think tank leaders become video stars

January 4, 2010

If a physicist, a venture capitalist and an anthropologist enter a bar, the TED conference is probably somewhere nearby and now the conferences are traveling beyond America.

Over the years, The Technology, Entertainment and Design (TED) conferences included speakers such as: Bill Gates, Frank Gehry, Jane Goodall, Al Gore, Billy Graham, Peter Gabriel, Quincy Jones, and Bono. The annual event brings together industry leaders from various sectors to celebrate innovations, learn from each other, and inspire even great ideas. Referred to as a four-day “brain spa”, the TED promotes innovative leaders and supports future ones. Yet, TED’s most inspirational stars are  often unexpected participants: Li Lu, a key organizer of the Tiananmen Square student protest and Aimee Mullins, a Paralympics competitor who tried out a new pair of artificial legs onstage.

“Robots will come with lifelike faces that convey human emotion”, said David Lawsky of Reuters. “That was just a sampling of the technology envisioned for the future at TED, the annual gathering of corporate, Hollywood and scientific glitterati touted as a caldron of ideas and innovation.”

Yet, TED Web site refutes claims that the conference is “elitest”.  The TED conference, which began in Long Beach, California circa 1984, already inspired sister events called TEDGlobal. The conferences are hosted in a different country every year. India, Tanzania and London have hosted recent conferences.

The regional conferences have also inspired new contests. TEDIndia ran a contest for the TEDIndia conference last November in partnership with flux.net. Participants submitted short films, music videos and commercials, lasting 30 seconds to 3 minutes. The purpose was to encourage film generation with high-impact and innovative filming techniques. The collection is available to the public on the TEDIndia website.

Despite the active participation in the annual conferences, (there were 1,450 participants in the annual conference in Long Beach, California) and TED prize competition, TED boasts of even stronger online participation. (Incidentally, the movement may be indicative of the long application process and $6,000 annual conference price tag.) There are  more than 50 million viewers from 150 countries alone watching TEDTalk as of June 2008. TEDTalk is catalogue of past conference videos, partners’ conferences, and other public talks  by innovative leaders in technology, entertainment or design. Yet, one of the goals of TED is to encourage future innovators. Anyone can subscribe and watch past videos online free of charge in 50 different languages. There is also a growing translation movement to continue to develop the number of languages and events available with subtitles. There is also an active online community of 5,600 members where members can share information, ideas and participate in online forums. 

There have been many amazing innovations highlighted at TED global events. TEDIndia gave Pranav Mistry, winner of the Popular Science Invention of the Year award and MIT staffer, a chance to show off his new technological invention. (His invention is a projection of a computer screen which can be manipulated through touch.) Yet, what the results of TED’s influence globally still remains to be seen; there have only been three non-U.S. conference events since 2005.

Will Social Innovation Fund Help Nonprofits Grow?

December 28, 2009

Can an organization that helps struggling mom-and-pop entrepreneurs get loans in today’s economy?

One agency did. Rising Tide Capital helped 250 New Jersey business owners run their businesses and improve their profit margins. In the next few years, 500 to 1,000 business might also benefit, suggested President Obama in a speech about a new funding initiative.

The Social Innovation Fund, a new initiative led by the Corporation for National Community and Service scheduled to begin in the summer of 2010, will support organizations like Rising Tide Capital and reward them for their success.

Social Innovation Fund  is a U.S. government program created to decrease spending and increase nonprofit efficiency through building capitol. The program encourages foundations to identify successful nonprofits who will provide measurable results. The nonprofits will then graduate from private funding to government funding. Foundations are rewarded by being released from fudning the nonprofit and the nonprofit is rewarded with continued funding. Community organizations who can prove that their organization works efficiently and achieves measurable results  within the SIF’s guidelines receive no less than $100,000 per year for three to five years.

 And SIF isn’t  looking just “at the usual suspects in the usual places”, according to President Obama. The program is seeking to fund “those hidden gems that haven’t yet gotten the attention they deserve.. in all sorts of communities — rural, urban, and suburban,” he said.

Yet, several experts in nonprofit management have voiced concern over whether U.S. government funding and managed programming will succeed in making nonprofits become more sustainable rather than reliant on federal funding.

Yet, the intended goal of SIF is to encourage nonprofits’ sustainability.  Instead of nonprofits depending purely on foundation funds, government and foundations will work together to improve existing nonprofits through longer term funding and providing the tools and incentives for better program managment. Successful nonprofits will present a record of  program development and match their sponsoring foundations’ funding on a 1 to 1 ratio. Public foundations and social venture funds are responsible for identifying worthy recipients and distributing SIF funds.

SIF will change the U.S. government approach to philanthropy: from supporting programs to supporting nonprofit organizations, said  Sean Stannard-Stockton in a blog on Tactical Philanthropy.

” The breakthrough idea here is to move government into the role of catalyst and out of the business of provider, offering real hope for the expansion of solutions-based programs,” said Tom Sheridan, a Washingtonian public policy strategist  in a recent guest blog on change.org. During the 2008 elections, Sheridan was the lead political strategist of a policy initiative to increase innovation, strategic investment, and accountability in public problem solving.

Anticipating great speculation around how funding will curb government spending on nonprofit funding, the Center for questions and comments on the SIF application process are welcomed until January 15, 2010. Yet, growing speculation exists around the intended outcome not the process.

The fund supports social innovation by providing funding as a source for growth capital. Nonprofits are expected to  to show programming development and expansion as a result of funding. A home-visiting initiative of  the Department of Health and Human Services, for example, could connect nurses and other trained professionals with at-risk families and provide the measurable results of more healthy children. President Obama mentioned the home visiting initiative as well as What Works Fund of the Department of Education which will invest in educational programming for school districts and communities. These programs are two potential initiatives of the SIF.

In return, foundations and other grantmakers present their decision making strategies and systems of measuring results of programs.  The fund, which was a maximum budget of $50 Million, carries an extremely competitive standards : no grants of less than $1 million and no more than 50 grantmakers.

 Since it is allow to make grants as large as $10 million, the final list will be between 5 and 50 grantmakers. That’s a list that foundations are going to want to be on. Even those that historically have not focused on providing growth capital, said Sean Stannard-Stockton in a blog on Tactical Philanthropy.

Nonprofits needs a wider range of diversity in financing sources, longer-term project cycles

Yet, this shift from foundations as designers of programs who drive growth capital  of nonprofits to  performance driven nonprofits is a major shift in philanthropy, according to Stannard-Stockton.

One which could potentially reward successful nonprofits overlooked before such as Rising Tide Capitol.

For nonprofits to be sustainable, said Lee Davis and Nicole Etchart of The NonProfit Enterprise and Self-Sustainabilty Team, Profits for Nonprofits, need not only a variety of sources for financing but also a variety of financing sources appropriate for their needs and stages of development. In the past, private companies have access to various sources of funding (banks, private companies, and private equity funds) whereas nonprofits only have foundations. SIF is working to make nonprofit reach financial success. The results of diversifying financial resources could lead to: more steady flow of secured income, increased diversity of  funding sources, decreased donor dependency, wider freedom in how resources are used,  and the ability to think and plan more strategically and long-term, according to The Nonprofit Enterprise Self-Sustainability Team.

“If we empower organizations like these, think about the number of young people..whose lives we can change; the number of families whose livelihoods we can boost; the number of struggling communities we can bring back to life,” said President Obama in the same speech about SIF.

Giving Credit Where it’s Due

November 27, 2008

CEOs of AIG, Citibank and others have much to be thankful for this year. The government has saved their profit margins and secured their savings for their annual sunsoaking trip to Belise in their private jet. Meanwhile, Salvation Army prepares to feed 3,000 people in downtown Detroit this morning alone. I am not a economist but the numbers still leave my eyes burning.

In the last three months, the unemployment rate rose from 6.1 to 6.5 percent with a total increase of unemployed persons now at 10.1 million in the U.S.  Treasury Secretary Henry Paulson syncretic move? He decided to use $200 billion dollars, part of the U.S. government’s 800 B initiative to revive credit markets, to increase credit card limits for the average American.  The idea is certainly to increase spending and jump start the economy, but giving people plastic is the most ridiculous way to help people. There is once again no accountability or forethought given to the great debt this will take the Federal Deficit into! 

When the average weekly earnings of an American working full-time is currently $720 for the third economic quarter, how credit cards turn into anything but lifelong servitude to a laundry list of credit card companies? The Consumer Federation of America and other lobbying agencies are encouraging Congress to include legislation in the bail out package to curb credit card companies from illegally hiking up their interest prices on existing card holders. In the recently passed Emergency Economic Stabilization Act, market transparency and financial oversight of credit card companies will be monitored by the U.S. government.

Will this system work? Will the government be able to help the average American balance their check book? I don’t see how this solution can be anything but a bandaid until the unemployment rate drops and food prices start to decrease.

We need farm aid in order to increase production and lower the prices for basic commodities. Regulation on loans without high interest rates is also needed to generate small business income. And we need an increase in the productivity of projects under the departments of public transportation, water and sanitation which will in turn increase the number of jobs available to Americans. It’s only logical. And that doesn’t an economist to deduct.