Achieving Economic Development in Thirdworld Using Nongovernmental Intervention

Almost all of the thirdworld economies heavily rely on nongovernmental intervention to accelarate their developmental pace. But does nongovernmental activity necessarily need to be nonprofit only? Is nonprofit and not-for-profit one and the same thing? Are there exceptions to the general rule? 

We live in a world where the terminology NGO equates to an organization for which earning profit is considered almost a sin. MuhammadAltaf™ challenges this predominant notion.

We believe that one of the most effective approaches to bring economic development in a society through nongovernmental intervention is by NGOs adopting profit oriented commercial activity to achieve their humanitarian and developmental objectives. Yes, if this model is adopted at a massive scale NGOs with weaker corporate governance can lose their charitable stance due to mal-intent of the ones charged with their governance. However, there are ways through which governing bodies of such NGOs and regulatory authorities can instill safegaurds on public money not being utilised to the benefit of a few individuals. How is it possible to do that? 

Eccentric as it may seem, we believe organizations like Aga Khan Fund for Economic Development (AKFED) and Grameen Bank have set the tone for tomorrow's nongovernmental economic development activity as explained below.

AKFED (http://www.akdn.org/akfed_companies.asp) operates as a network of affiliates with more than 90 separate project companies employing over 30,000 people, with annual revenues in excess of US$1.5 billion. The Fund is active in 16 countries in the developing world: Afghanistan, Bangladesh, Burkina Faso, the Democratic Republic of the Congo, India, Ivory Coast, Kenya, Kyrgyz Republic, Mali, Mozambique, Pakistan, Senegal, Syria, Tajikistan, Tanzania and Uganda. For more than 50 years, AKFED has made investments and operated companies in the developing nations of Africa, South Asia and Central Asia. AKFED seeks to create profitable, sustainable enterprises through long-term investments that result in strong equity positions. This in turn allows AKFED to take a “hands-on” approach by providing managerial and technical expertise. Profits generated by the Fund are reinvested in other economic development initiatives under the AKFED umbrella.

Grameen Bank (http://www.grameen-info.org/) and Grameen Foundation (http://www.grameenfoundation.org/) operate in 4 continents of the world in a large number of countries to apply their microfinance based strategy for poverty alleviation to ultimately achieve socioeconomic development at a large scale; a strategy that was so successful over the last three decades that the founder of Grameen family, Dr Yunus, was awarded the 2006 Nobel Peace Prize. However, our focus at this point is not the strength of microfinance as a tool for poverty alleviation but the development model that they have adopted in the form of a group of companies that is poised to instill sustainable development in the areas where they operate. Grameen’s developmental approach stands out as an outstanding one due to a number of aspects such as borrowers of the Bank, who are mostly the ones living on poverty line, own 93% of the Grameen Bank, and they also have access to Grameen subsidiaries, which provide services and products that would otherwise be inaccessible to those destitute people. Grameen can create large-scale poverty alleviation in  thirdworld by employing the poor in viable subsidiary companies and training them in marketable skills. Principal subsidiaries of Grameen Bank include: Grameen Trust; Grameen Motsho (Fisheries) Foundation; Grameen Uddog; Grameen Telecom; GrameenPhone; Grameen Shakti (Energy); Grameen Cybernet Ltd.; Grameen Communications; Grameen Securities Management Company; Grameen Foundation USA; Grameen Shamogree (Products); and Grameen Kalyan (Welfare).

While focus of AKFED and Grameen may be different from those NGOs that are involved in relief, rehabilitation and reconstruction work, who are not supposed to engage any profit oriented activities, the long term impact created by AKFED and Grameen is everlasting and self-sustaining. And this is what we, at MuhammadAltaf™, believe to be the most viable approach to bring economic development into the thirdworld through the deployment of NGOs. 

To establish the modalities and implications of how NGOs can take up profit oriented commercial activity to achieve their humanitarian developmental objective while keeping their charitable stance intact, Muhammad Altaf Hussain, CEO of MuhammadAltaf™, conducted extensive primary and secondary data research to conceive the NonGovernmental Economic Institutions (ENGIn) Development Model. We invite you to give your feedback on it by sending your emails to muhammadaltaf@muhammadaltaf.com or info@muhammadaltaf.com. The Model was placed for public discussion for the first time on 8 December 2003 and can be accessed by clicking on the following link:

http://dtwl.yolasite.com/engin-development-model.php 

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Our Values and Culture at MuhammadAltaf™

Our biggest asset is our people. Our people give direction to our course of action. We have a democratic culture where saying and doing the right thing is above and beyond every heirarchy. As employers we believe in delegating authority before seeking responsibility.

We consider our clients, students, donors and beneficiaries as our lifeblood. We like to put them ahead of ourselves in letter and spirit. Our approach in handling professional affairs heavily envisages development of expectations with our stakeholders before we engage any professional responsibility. For us, the decision to let go is as important as the decision to engage an offer to accept a professional responsibility. This is because we place credibility of our name above and beyond our business needs . We believe in building relationships based on saying and doing only the right thing.

We have an open door policy for all internal and external stakeholders. We respect individuality of every human being connected to what we do. We wish to give them every opportunity to enable them achieve their goals of life. That is because, ultimately, all our thoughts and actions are aimed at one thing only: improving quality of life of people living in the areas wherein we operate, which is our mission.