There is no denying the prevalence and prominence of the impact investing discourse these days. A hot topic? Absolutely. A brand new conversation? Not even close.
So, when you can hear from one of the early pioneers of the industry, it is always insightful.
This week we hosted Tammy Newmark and Michele Pena of EcoEnterprises Fund who joined us as part of the Skoll Centre Speakers Series. They have been investing growth capital in sustainable businesses in Latin America for over a decade – and have the battle wounds to prove it.
Not that it’s been all setbacks and scars — but because they simply are open and transparent about the challenges they (and other risk-taking impact investors) have faced over the past 10 years.
Set up in 2000, EcoEnterprises Fund provides long-term investment capital and business advisory services – one without the other would be ineffectual and downright bad business, they say. The Fund has invested in 23 companies from ecolodges to organics, sustainable forestry to aquaculture. Most of these investments have been wildly successful (20 companies still in operation, 11% p.a. return, and most importantly, measurable social and environmental impact) but of course, there have been challenges.
Which is no surprise, seeing that they are injecting risk capital into companies that are, well, risky. They bet on the companies that are first-movers and market makers, whose products and services have yet to gain market acceptance. As such, they are cultivating new demand and a vibrant marketplace that moves these eco-enterprises from the outskirt to the mainstream.
What’s next for EcoEnterprises Fund? Be on the look out for their book this fall called “Portfolio for the Planet”, which is an open playbook to their tools, indicators and investment cases. Also, they are currently raising $30 million for a new fund EcoE II, which will target 10-12 small and growing community-based businesses via mezzanine investment instruments.
This post was written by Nereyda Esparza, a second year MPhil student in Latin American Studies at the University of Oxford, St. Cross College.
“There’s a growing recognition…that focusing on women and girls is the most effective way to fight global poverty and extremism…The world is awakening to a powerful truth: Women and girls aren’t the problem, they are the solution.”
– Nicolas Kristoph & Sheryl WuDunn, The New York Times
Last week, I attended a Skoll Centre Speaker Series talk hosted Lynne Patterson of Pro Mujer.
Pro Mujer is an international women’s development organization that uses microfinance to give Latin America’s poor women tools to create livelihoods for themselves and their families through business training and healthcare support. Started in 1990 in Bolivia by Lynne Patterson, an American schoolteacher, and Carmen Velasco, a Bolivian professor, Pro Mujer today has fully operating programmes in Bolivia, Peru, Nicaragua, Argentina and Mexico. Over the past 20 years, the organization has disbursed over US$950 million in small loans averaging US$309.
Over the course of the talk, it became clear the power Pro Mujer has to transform women’s lives. The company gives small loans to women to start up profitable business and turn the most impoverished and marginalized of women in these communities into small-scale entrepreneurs.
Not only do these loans help women become financially independent, they remind women of their value and intelligence, they raise self-esteem and create confidence. Pro Mujer shares stories about women being too shy to speak before their business training and by the end had taken up leadership positions and became advocates of the company.
Pro Mujer in Peru Client Ana Alicia Cruz de Flores. Courtesy of Pro Mujer
Pro Mujer also saw the link between healthcare and women’s vulnerablity towards poverty. To address this, Pro Mujer also offers women access to health care and has saved the lives of thousands of women by providing essential care like pap smears for cervical cancer testing.
Yet, with so much focus on women in microfinance, and the presence of the widely popular conditional cash transfer (CCTs) programmes in Latin America whose claim to innovation is rooted in an integrated approach to poverty alleviation combining education, health and nutrition in a single intervention – what sets Pro Mujer apart?
I would argue that Pro Mujer is different in two ways.
1. Pro Mujer is truly an organization for women by women.
It not only gives women the tools necessary to become financially sustainable, it also encourages women to believe in their strengths and their abilities. In other words, it helps “empower” women, as defined by Maxine Molyneux: empowerment is “the acquisition of capabilities which have the potential to assist women in achieving autonomy (legal and material), equality (social and personal) and voice and influence (over decisions that affect their lives).” The women of Proj Mujer gains agency over decisions that affect their lives and even promote greater gender equality through generational changes (i.e. girls growing up in better homes and with positive role models).
CCTs, on the other hand, use women as “vehicles” for development using a traditional view of the household, where women are homemakers whose sole purpose is to provide for the family and children at home. Women in CCT programmes have to meet “co-responsibilities” that take time away from their ability to find a job or focusing on other income generating opportunities. In other words, women end up working for development instead of development working for them.
2. Pro Mujer acknowledges that education is the greatest enabler in life, an essential tool for women to bring dignity and success to their lives.
Lynne Paterson said it best in her talk: “Education is in everything that we do. We are teachers and we wanted Pro Mujer to have education in mind in all its initiatives.” Not only does Pro Mujer teach women about financial literacy, it teaches women about the values of being a leader and the expertise that woman can bring to the table on all walks of life.
By focusing on women’s gains, health and education, Pro Mujer is setting a great example of how business has the ability to truly empower women in the developing world.