‘Social business cities’ could ease urban growing pains, Nobel laureate says

Cities are under pressure to bring their infrastructure up to speed.

Cities around the world should tap ethical entrepreneurs to help ease their growing pains, ranging from homelessness to unemployment, Nobel laureate Muhammad Yunus said on Thursday.

The founder of the microcredit movement said “social business cities”, which have sprung up from Germany to Japan, could help to solve social issues in a rapidly urbanising world.

“(We can) activate the creativity of individuals and corporates together to solve the problems of cities,” Yunus told the Thomson Reuters Foundation on the sidelines of the Philanthropy for Better Cities Forum in Hong Kong.

About 55 per cent of the world’s population lives in urban areas today, according to the United Nations. It is projected to jump to 68 per cent - with another 2.5 billion people - by 2050.

If you can convert some of these (welfare) programmes into social business, then the money comes back to you, it becomes very powerful.

Muhammad Yunus, Nobel Peace prize winner 2006

Cities are under pressure to bring their infrastructure up to speed, while also tackling a host of challenges, from preventing disasters to providing clean water and energy.

Yunus said inviting social businesses - which aim to solve social problems while turning a profit - to invest in areas like health and housing could free up money for cash-strapped cities to spend on development.

“If you can convert some of these (welfare) programmes into social business, then the money comes back to you, it becomes very powerful,” the Bangladeshi economist said.

Yunus revolutionised finance for the poorest when he started providing tiny loans to Bangladeshi villagers at market interest rates without requiring collateral.

Since winning the Nobel Peace Prize in 2006 jointly with Grameen Bank, the microcredit organisation he founded, he has committed his portion of the $1 million prize money to developing social businesses.

He set up the Yunus Centre a decade ago to promote social businesses as a way to fight poverty and to help academic institutions develop programmes focusing on the sector.

The Nobel Peace Prize winner said learning about social businesses should become part of “normal growing up” through education in schools.

The two-day conference is hosted by the Hong Kong Jockey Club Charities Trust with an aim to create more liveable cities.

This story was published with permission from Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, women’s rights, trafficking, property rights, climate change and resilience. Visit http://news.trust.org)

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