Emerging Leaders and Small Business Owners from Latin America visit GP in Seattle
by Nathalia Rodríguez Vega, financial and economic analyst at Global Partnerships (GP)
In June a group of 14 emerging leaders and small business owners from Latin America visited our office in Seattle to discuss how we raise investment capital through strategic philanthropy, and how we use those resources to support and develop sustainable solutions to poverty. Our visitors were nominated as upcoming leaders in their respective fields by their country’s U.S. Embassy office; invited to the U.S. as participants of the State Department’s International Visitors Leadership Program (IVLP); and were brought to Seattle by the World Affairs Council. Our meeting not only gave us the opportunity to share our work but, perhaps more notably, it provided us with a chance to have a dialogue with regional leaders about their views on the role of outcome-oriented philanthropy in solving some of the most pressing social and economic development challenges across Latin America & the Caribbean.
We also chatted about the growing trend in the impact investing field towards emphasizing the importance of measurable outcomes. One highlight from our meeting was when we started discussing Global Partnerships’ (GP) belief in the role that markets should play in creating social impact; at this point, questions and comments flew in from every corner of the conference table. Our brand of impact investing involves utilizing both investment and philanthropic capital to achieve social and financial impact through investments in local microfinance institutions, cooperatives, and social enterprises that understand their clients’ needs. In our experience, the value of using this method for addressing some of the world’s most pressing development challenges is that it creates long-term sustainable and scalable solutions that traditional charities may not be able to accomplish. Our visitors were open to this new approach and eager to ask for examples from our daily work to better understand how we create economically viable solutions for the poor. Moreover, they were interested to learn how we select our partners and ensure that they are reaching bottom of the pyramid populations. These questions gave us the opportunity to explain our screening, due diligence and monitoring processes.
When our talk shifted to our four impact areas (health services, green technology, rural livelihoods, and microentrepreneurship), we shared some additional insights into our work. For example, our visitors were interested in learning how we bridge the last mile (lack of access due to cost/geographical constraints) by leveraging distribution channels from microfinance organizations to offer green technology solutions. The examples we used from our partnerships in countries like Honduras, Nicaragua, and Peru not only enhanced our discussion, but also, offered our visitors ideas on how they can apply some of these principles in their work.
We would like to thank the World Affairs Council for giving us the opportunity to meet this group of leaders and entrepreneurs. We thoroughly enjoyed having a meaningful dialogue with them about our passion for our mission to expand opportunity for people living in poverty to improve their own lives.
- Join us at Business of Hope on October 8, 2013 to learn more about how we use catalytic philanthropic capital to pioneer promising solutions to solve the problem of energy poverty.
- Discover why leaders of mission-led organizations believe that catalytic philanthropy has a greater potential than “traditional” philanthropy to launch solutions that are scalable and sustainable.
- Our fall issue of IMPACT, our tri-annual newsletter, will explore how we at GP measure impact and what the numbers and metrics in our reports mean. Don’t miss out—subscribe to receive IMPACT for free in your mail/inbox in September.
How do you Know if a Country’s Citizens Have Good Health Care?
Most of us are familiar with reports on maternal and childhood mortality rates, but what other metrics should be considered when evaluating the health of a nation’s population? Some say that the answer lies within the newly launched Social Progress Index (SPI), which ranks 50 countries according to “indicators in the areas of basic human needs, foundations of wellbeing, and opportunity.” The SPI team calculated and evaluated many indicators, including the “availability of quality healthcare.” In doing so, they found that Peru, Mexico, Colombia and the Dominican Republic (all countries in our health services portfolio) ranked in the bottom half of all countries surveyed vis-à-vis health and wellness.
Yet, we at Global Partnerships (GP) believe that the challenge is not just about availability; it’s also about access to and utilization of quality and affordable health care. In this case, access means not only affordability but also, geographic access. At GP we work with our partners to identify prevailing health conditions. We also work with them to address access and utilization challenges like: having the cash needed to visit the doctor, raising awareness of the products and services available for treatment, and having the time needed to travel to and from the doctor.
GP works with partners, including both microfinance institutions (MFIs) and cooperatives, who are interested in integrating health care services with financial products that address these challenges sustainably. For example, in our work with Fonkoze, the largest MFI in Haiti serving women at the bottom of the economic pyramid, we have collaborated to develop a new business model to ensure the health services program will no longer depend on grant funding.
We actively gather data and insights from Fonkoze’s pilot program to inform and guide the operation to scale. Key learnings include:
- Education and basic health screening (e.g., malnutrition, diabetes) scale faster;
- Health services that address the most prevalent patient needs and that are most valued are also the most financially sustainable;
- Piggybacking on existing client contact opportunities facilitates delivery of additional services, increasing access and awareness;
- Negotiating bulk discounts with strategic providers ensures reduced costs for clients; and
- Having sufficient management experience over health experience is more important in solving the “last mile”* delivery problem, at scale and sustainably.
With these insights, Global Partnerships is working alongside Fonkoze to create and scale up a suite of sustainable services that are affordable and relevant to the women they serve.
The SPI’s stated purpose is to “elevate the quality of discussion on national priorities and to guide social investment decisions” by ranking country performance relative to one another, which is helpful for a nonprofit impact investor like GP. But in regards to health indicators, we’ve learned that it takes more than availability to make a lasting impact.
*Last mile: lack of access due to cost/geography.
- Discover more about GP’s health services work in depth, or watch a 2 minute video that provides a quick glimpse.
- Read about how “empathetic capital” is used to make medical technologies affordable for all, especially those living in poverty.
- Have any questions about our health services work? Please let us know in the comments section below. We look forward to hearing from you.
The Coffee Conundrum
Earlier this year, The Atlantic Monthly wrote about the conundrum coffee farmers face in growing organic coffee and fending off the rampant rust disease that has afflicted the coffee crops of Latin American farmers. If left unaddressed, Coffee Leaf Rust, which is caused by a fungus, is predicted to cause crop losses of $500M and cost over 300,000 jobs in Central America.
Given the demand for organic coffee in the U.S. and elsewhere, Steve Savage, a researcher from Colorado State University, posed the question: “Could it be that well-intentioned but uninformed consumers, in pushing for organic coffee, are supporting an option that is less beneficial from an environmental and social justice perspective?” He says that the most effective treatment is to use synthetic fungicides; however, under strict organic guidelines, farmers are not allowed to, which forces them to make a decision between maintaining organic standards but risk losing their crops and income or using conventional treatment methods and risk losing the premium pricing that they’d get on organic coffee. There’s also the option of replacing existing coffee crops with varieties that are more rust resistant, but replanting is a 3-5 year process that would necessitate longer loan terms, and depends upon availability of these rust-resistant varieties. Many reports say that the problem could get worse next year, threatening global coffee exports.
We hear about this issue a lot in talking to our partners who work with coffee farmers. There’s no easy answer but we believe giving farmers access to technical assistance and information along with affordable capital can help mitigate the disease’s impact on their crops and hopefully, help keep their farms thriving. Giving farmers the information and knowledge to make their own decisions on how to address the coffee rust issue may be the best approach.
- Get more information about GP’s work with cooperatives.
- Read about roya, the fungus that causes the coffee rust disease and its impact on farmers in Central America.
- Wired Magazine wrote a June 2013 article about the threat to “good coffee” and to the livelihoods of the farmers that produce it.
- Learn more about what global development leaders (including representatives from the U.N. World Food Program, Biovision, and Sustainable Food Trust) have to say about addressing the need for sustainable agriculture during the second annual Partnering for Global Impact conference taking place from July 10-11, 2013 in Switzerland. Join the conversation on Twitter with hashtag #PGI2013 or follow @PGImpact.
As we all get ready to celebrate Independence Day and our collective spirit of patriotism, it’s a good time to reflect on U.S. generosity around the world. When President Obama pledged $7 billion to support energy access in sub-Saharan Africa this week, we at Global Partnerships nodded in support. The “Power Africa” initiative that the President announced is not so much about energy as it is about empowering families to help lift themselves out of poverty.
He put the need more eloquently: “Access to electricity is fundamental to opportunity in this age. It’s the light that children study by, the energy that allows an idea to be transformed into a real business,” Obama said while speaking to students at Cape Town University in South Africa today. “It’s the lifeline for families to meet their most basic needs, and it’s the connection that’s needed to plug Africa into the grid of the global economy.”
Worldwide, over 1.3 billion people live without access to electricity. Of those, roughly 30 million live in Latin America and the Caribbean. In under a year, Global Partnerships has invested $500K towards sustainable solar-lighting projects for off-grid families in Latin America and Haiti.
As an impact investor, we’ve seen the transformative power of solar lights. And as an OPIC investee, we applaud OPIC’s $1.5 billion investment in addressing the global energy access gap through the President’s “Power Africa” initiative.
- CNN video on President Obama’s $7 billion pledge to power Africa.
- Read about the International Energy Agency’s global status on modern energy access.
- Check out ONE's blog post on 6 ways energy poverty threatens healthcare of people living in poverty.
Supporting Farmers Globally: Celebrating the UN International Day of Cooperatives (6 July 2013)
by Gregg S. Johnson, member of Board of Directors, Global Partnerships, a nonprofit impact investment organization based in Seattle, WA
On July 6, we celebrate and honor the small holder farmers from around the globe in recognition of the UN’s International Day of Cooperatives. Nearly 500 million families make their living from small-scale rural farms in the developing world. That’s more than the entire population of the U.S. These farmers support 2 billion people and “account for 97% of the world’s agricultural holdings,” yet most don’t have access to the resources, information and commercial markets needed to improve their own lives. Cooperatives play an important role in bridging that access gap.
In April, I was reminded of the dedication and hard work of these rural agricultural communities when I traveled to Latin America with Global Partnerships (GP). We got a chance to meet María Montenegro Chavarría who owns a small vegetable farm in rural Nicaragua. She obtains working capital through GP’s partner, Aldea Global, a fair trade & organic cooperative in Jinotega, Nicaragua. But more importantly, through Aldea Global, she gains access to commercial markets to sell her broccoli and celery. This is because Aldea Global connects small-scale farmers like María and her husband, Edwin, to commercial retailers, who can pay much better prices for her produce than the local markets. Seeing a small-holder farmer like María get access to the global marketplace reminded me of how connected our world truly is. Expanding her farm will help increase the opportunities available to her and her 5 children including better education, increased income, and health.
After talking with María, I came away with a couple of thoughts:
- In countries with unstable currency, wealth is built by immediately investing any working capital into hard assets such as equipment, land, livestock, crops and agricultural inputs. This translates into multiple cycles of borrowing and repayment that allow both wealth accumulation and greater access to credit to finance equipment or land purchases to help them expand their farms over time. Smart business people like María can leverage credit to effectively grow their business and increase assets over time.
- Access to capital is not enough. When investments are supplemented by training and technical assistance, it can make a big difference between a farmer who lives from loan to loan and a farmer that is able to grow a sustainable business. Increasing quality and yields of crops and access to markets will significantly boost a family’s income and thus, provide them with more opportunities to help them improve their own lives well into the future.
This brings me back to the role of cooperatives in helping to bridge the access gap. Cooperatives play an essential role in connecting small-holder farmers with the technical assistance, commercial markets, and information they need to improve their own lives. Global Partnerships invests in cooperatives that not only help provide access to capital but also provide access to the many other resources and information small-holder farmers need to lift themselves out of poverty.
- Get more information about GP’s work with cooperatives
- Remember: July 6, 2013 is UN International Day of Cooperatives (recognized on the 1st Saturday of July)
- Support organizations that help farmers like María.
Gregg S. Johnson is the founder of Johnson Consulting Associates, LLC. Gregg provides senior-level advisory & coaching services to a variety of for-profit & nonprofit organizations. In his not-for-profit engagements, Gregg has served a large variety of social enterprises in strategy development, business planning, and interim executive roles. Prior to starting his company, Gregg was a senior executive at Starbucks Coffee Company for over thirteen years, where he led the implementation of their worldwide operations.
GP recognized for its “sustainable solutions for the poor” by OPIC
By GP Staff
The Overseas Private Investment Corporation (OPIC) recently profiled Global Partnerships as one of their featured investments. We were pleased to have OPIC recognize our good work as a nonprofit impact investor helping to expand opportunity for people living in poverty in Latin America and Caribbean. Read their featured profile of us here.
- Read about how “OPIC mobilizes private capital to help solve critical development challenges.”
- Check out this piece in Huffington Post about the role of government in formulating policies that can bolster the success of impact investing for creating social impact.
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