Entrepreneurs Hold the Key to Solving Social Problems

All human beings are born as entrepreneurs, according to Nobel Peace Prize laureate Professor Muhammad Yunus.

Speaking at the fourth NEXUS Australia 2018 Summit in Melbourne on Tuesday, Yunus, the pioneer of modern microfinance and social business, told the audience fostering entrepreneurship was the solution to reversing the one way direction of wealth and solving entrenched social problems.

Yunus talked about how he set up the Grameen Bank in Bangladesh in 1983 with the aim of using microfinance to empower poor people to escape from poverty by building their own businesses.

He criticised capitalist theory as being based on the assumption that human beings were only driven by self-interest.

“That is the killer. We all became people driven by self-interest because that’s what the theory told us,” he said.

“I said no, theory has mislead us.

“Looking back, all of the businesses I have created have been created on the basis of selflessness because we didn’t want to make money for ourselves.”

Since it was established the Grameen Bank has advanced to the forefront of a world movement toward eradicating poverty through microlending.

It now serves more than 7 million poor families with loans, savings, insurance and other services.

Yunus said there was more than one way of doing business.

“Our mind is bound by our understanding of the world and the economic system as it is,” Yunus said.

“Our economic system encourages us, prepares us to do the business we all know, how to make money, maximisation of profit. They don’t talk about the other kind of business, problem solving business.

“It is a funny idea because it is not in the textbook. That’s where we went wrong. So why don’t we edit into our textbook, why don’t we edit into our theory.”

He said he used the term social business before he could explain it.

“To solve each of the problems we notice, we create a business to solve it,” Yunus said.

“The speciality of this business is there is no intention of making personal money out of it. It is a non-dividend company to solve a social problem, that what’s I started calling social business.

“I created the venture capital fund with the same intention as a social business.”

He said the current capitalist system had made the world in such a way that all the wealth goes in one direction.

“All the wealth goes to the top,” he said.

“We don’t realise it, we are very happy doing our daily thing. But today, less than 1 per cent of the entire population of the world earns more than 99 per cent of the wealth of the world.

“This is a mockery of a system.”

Yunus described the current system as a “ticking time bomb”.

“It can explode at any time,” he said.

“All the wealth is going up in one direction only, it is not something where you feel safe, it has to be shared. So how do we slow down that process because it is becoming speedier and speedier?

“The best thing would be to reverse it. Instead of all the wealth going to one little corner, distribute it to the rest of the people. So that is the challenge for all of us.

“We can ignore it, we can debate it, but this is not going to change unless we go back to the fundamentals. The fundamentals are one simple thing, who we are as human beings. Are we all fitted with the glasses given by economic theory, where we see everything in dollars?”

He said a solution would be for everyone to become entrepreneurs.

“If we all become entrepreneurs, there will be no wealth consolidation, because we’ll be keeping wealth ourselves,” he said.

“There is no way this wealth can go up because we are not working for anybody. Because we work for the people who make the money, who make the wealth, we become the mercenary for them, since we don’t work for them, they can’t make the money, it starts reversing.”

He issued a challenge to the young social entrepreneurs and philanthropists in the room to think about what role they wanted to play as individuals.

“Young people, millennials, are the lucky generation because they have all the power in the world in their hands because of technology, no other generation in history was more powerful than the current generation of young people,” he said.

“All I have to say that please be aware that you have the power.

“Then ask yourself a simple question and get the answer. For what purpose should I use this power? Whatever your answer go for it. See what kind of world you can build for yourself. Because this is the world you have to live in.

“You are the genie in Aladdin’s lamp. You can do unbelievable things at unbelievable speed. It is possible to change the world completely in a different way, so that’s your challenge.”

Yunus received a standing ovation at the conclusion of his speech, which brought a close to the summit, which was hosted in partnership with the Foundation for Young Australians (FYA).

More than 200 young philanthropists, social entrepreneurs, and activists aged between 18 and 39 years old, attended over the three days.

Chair of NEXUS and Trustee of the English Foundation, Rachel English said the summit provided a platform for young people to safely express their ideas and collaborate with like-minded individuals.

“Between 2007 and 2061, an estimated $59 trillion will pass from older to younger generations in the USA alone, the biggest transfer of wealth of our time,” English said.

“But the global mechanisms dedicated to creating this wealth far outweigh those dedicated to giving it away. In Australia this means our nation’s significant growth in absolute wealth has not translated into a growth in philanthropic giving.

“We know that young people worldwide have the fresh ideas and innovative thinking needed to build and create solutions to some of our world’s most pressing social challenges. This event is an action-oriented and solutions focused opportunity that connects the financial, intellectual, creative and social capital of this generation.”