Microfinance and Innovation: Are we reinventing the Wheel?

I had an opportunity to co-author with my ex supervisor Professor Ian Miles to write an opinion in the world magazine MicrofinanceInsights. The piece appears in the latest edition (Vol 15, Nov/Dec 2009). I quote the editorial’s comment:

Innovation: Are we Reinventing the Wheel?

In this issue, we look at different innovations—product, technology, and financial—that are adding value and efficiency to the sector. In our Commentary, Ian Miles and Yanuar Nugroho of the University of Manchester, argue that microfinance is now poised to bridge the gap between the privileged and the bottom of the pyramid, with the help of innovations that bear no resemblance to the Wall Street machinations that helped bring the global economy to its knees. In our cover story, Stephen Hodgson of Redport International and Yana Watson of Dalberg Global Development Advisors, question the nature of innovation that has taken place in microfinance to date; cite examples from the annals of financial history that could work well when applied to microfinance; and conclude that the sector might be better served if it adopts models that have been tried and tested in other spheres of finance. The issue brims with examples of innovations that work—from mobile technology in India to financial education for Mongolian teenagers to ATM-style kiosks in Georgia—and ones that don’t, such as the Business Correspondent system, which has faltered in India. In this issue’s Survey, our team polled 180 microfinance institutions about how Information & Communication Technology has influenced their work. You will also find the results of a Reader Survey we conducted in September to gauge what our audience thinks of Microfinance Insights so we can tailor the content to suit their preferences.

Corporate governance: Towards bonum commune?

Perspective is about bringing together things that seem to have no relation to each other so that they could be more easily understood in a context. It sounds simple. But it helps scrutinising the relationship between noble idea of good governance and hullabaloo of corporate responsibility. Why these two? Firstly, because discourse about good governance today cannot but touch upon the issue of corporate governance. And secondly, because corporate responsibility has become the issue of corporate governance.

It has been admitted that corporations are playing vital role in developments as they create employment, produce goods and services, bring investments and thus economic growth. As no one would disagree that good governance is necessary for development, neither do they contradict the idea that good governance should be applied to corporate world. Even, it flowers a thought that business should be allowed to regulate themselves.

Martabat buruh, kinerja modal dan penyelenggaraan publik

Oleh Yanuar Nugroho
CSR Review 13 Januari 2008

“Globalisasi produksi kini tengah membentuk kembali lansekap ekonomi internasional. Dengan itu, pengetahuan lama yang mengatakan bahwa negara maju adalah eksportir modal dan teknologi dan negara berkembang sebagai importirnya pelan-pelan harus minggir dan memberikan tempat bagi relasi keduanya yang lebih kompleks… Tren saat ini mempunyai implikasi yang penting bagi pembagian kerja di dunia. Pandangan tradisional bahwa aktivitas produksi yang lebih kompleks dilakukan di Utara dan yang sederhana di Selatan makin tidak mencerminkan realitas. Perusahaan kini melihat bahwa negara berkembang menjadi penting bukan hanya karena buruh murah, tetapi terutama pertumbuhan, ketrampilan dan teknologi.”

Setelah demo masif para buruh menolak revisi UU No. 13/2003 yang sarat dengan pengabaian hak-hak pekerja, pemerintah akhirnya mengambil sikap untuk mengevaluasi pelaksanaan UU tersebut sebelum merevisinya.  Tentu sikap ini disambut baik oleh buruh. Namun, pengusaha menunjukkan gelagat lain: mereka ngotot minta revisi segera dilakukan dengan tetap menggunakan draft yang sudah ditolak tersebut. Alasannya, revisi itu perlu untuk memikat investasi.  Jika saja kita mau sedikit lebih jeli melihat problematika ketenagakerjaan itu, disana ada tegangan mendasar: martabat manusia dan kuasa modal.

Tanggung jawab dan Keberlanjutan

CSR Review, Edisi 1, Business Watch Indonesia, Oktober 2005

Yanuar Nugroho*
Direktur Eksekutif – The Business Watch Indonesia

Dengan nilai penjualan tekstil berbahan katun mencapai 2,1 trilyun dollar AS tahun 2000 dan diperkirakan omzetnya akan melejit ke 10 trilyun dollar AS tahun 2010 nanti, pantas jika para pelaku industri tekstil Indonesia waswas menanti diakhirinya kuota global tekstil akhir tahun ini. Mengapa? Karena jika tidak menjadi ‘pelaku yang baik’ di dalam global supply chain industri tekstil dunia, mereka akan ditinggalkan pasar[1]. Dan apa itu pelaku bisnis yang baik? Washington menjawab dengan tegas: produsen tekstil di Indonesia harus memperhatikan soal tanggung jawab sosial korporasi (Corporate Social Responsibility, CSR) seperti kesejahteraan pekerja dan perlindungan lingkungan jika ingin mengakses pasar tekstil AS[2].

Social accountability more than just being responsible

Opinion and Editorial – THE JAKARTA POST, November 09, 2004

Yanuar Nugroho

The world-famous business strategy consultant, Peter F. Drucker, in a recent interview in Joel Bakan’s new book, The Corporation (2004), says “If you find an executive who wants to take on social responsibilities, fire him. Fast.”

Those who believe, or are in favor of, corporate social responsibility (CSR) may be shocked. But, bravery is indeed needed to scrutinize the very heart of business practice, without which we may be misled when addressing the role of business and corporations in our lives today.

Kepemilikan Intelektual – Saat Manusia Bermain sebagai Tuhan

TEROPONG, Mingguan Hidup, September 2003

oleh Yanuar Nugroho

Saat ini, uang menentukan hidup mati seseorang. Makin sedikit anda punya uang, makin sedikit pula kesempatan anda untuk hidup di bumi ini. Suka atau tidak, ini sebuah fakta. Setidaknya, kini kita hidup dalam sebuah dunia dimana mati atau hidup bukan lagi sesuatu yang ‘alamiah’, melainkan ‘bisa dibuat’.

The inner sanctus of trade, stopping unfair practices

The Jakarta Post, Saturday 17 May 2003, OPINION & EDITORIAL

by Yanuar Nugroho

Business nowadays is no different than what it was before, except that it is now so widespread and is such a powerful force. And what lies at the heart of business? Trade.

Fair trade today: When business undermines life

The Jakarta Post, 6 November 2002, Opinion & Editorial

Despite apparent global growth and steadily increasing per capita income, the gap both within and between rich and poor countries seems to be widening. The United Nations reported that in 1960, the richest fifth of the world’s population received 70 percent of global income compared to 2.3 percent of the world’s poorest 20 percent. By 1989, the richest 20 percent had increased their share to 82.7 percent while the bottom fifth’s share of global income shrank from 2.3 percent to 1.4 percent (UN Development Report, 1992).

‘There are casualties in successful businesses’

The Jakarta Post, 23 September 2002, OPINION & EDITORIAL

The head of The Indonesian Control Body for Stock Market (Bapepam) Herwidayatmo last month stated that the number of public investors in Indonesia now number only 55,000, down from 1995 when there were more than two million investors.

Herwidayatmo said this is caused by three main factors: The economy, lack of good corporate governance and investor disappointment with stock market services. Are these reasons valid? Let’s look at some other facts.