Doing Good Business

By Barbara Kiviat

In corporate circles, the "double bottom line"--reaping profit and doing social good--is all the rage. Muhammad Yunus, the microfinancier who won the Nobel Peace Prize in 2006 for helping prove that making tiny loans to poor people can be profitable, says we should go further. In CREATING A WORLD WITHOUT POVERTY: SOCIAL BUSINESS AND THE FUTURE OF CAPITALISM, he sketches out a new type of company, one that exists only to better people's lives. Investors who start such a firm would be repaid their initial stake once the company turned a profit, but after that, all the money made would go back into the business of helping people.

It may sound far-fetched, but Yunus offers up a real-world example: a partnership between the French foods giant Danone and Yunus' Grameen Group to sell nutrient-enriched yogurt to poor children in Bangladesh. He calls it the "world's very first consciously designed multinational social business"--a company that doesn't insist on an ongoing return to shareholders. Whether there's enough motivation in boardrooms to make the idea grow is a big question, but there are some 100 million microborrowers around the world. So it's a nice client base.