I just read a paper written by the economist Cielito Habito on the “Solidarity Economy Movement” which started in North and Latin America. It talks about a system that creates inclusive growth for participants in the market economy whether you’re a consumer, firm owner, laborer or a capitalist. One element in this system – the Socially Responsible Investments (SRI) – caught my interest because it’s an easy avenue for people, especially those with money, to contribute to nation building.
It’s a challenge to make people understand social development. I remember giving a talk to one of the biggest universities in Manila on Social Entrepreneurship. The emcee gave an introduction on social entrepreneurship as if the subject is on merging business principles with social media – creating enterprises that maximize the use of Facebook and Twitter. Que horror! If the majority finds difficulty in learning social development, there must be another way to “capitalize” on our population.
One of the current trends is the increasing number of people who want to invest – mostly OFWs and young professionals. I have lots of friends who are not yet 100% sure where to put their money – stocks? mutual funds? in the bank? foreign exchange?
I am averse to putting my money in stocks, mutual funds and even time deposits because these just fuel the machinery of capitalism. Yes, there’s a possibility of a higher yield, but wouldn’t it be more worthwhile to have your investments fund micro lending for the poor, capital for social enterprises, or finance operations of an agricultural cooperative? SRI is another alternative.
SRI involves investors who invest not solely on the basic financial returns, but also on their commitment to social development. On a macro level, these are people who orient their investments toward ethically responsible productive firms, cooperatives, ethical banks, savings & loans solidarity funds, and the like. If you scan the market for these kinds of investments, you won’t easily find available options.
Yet, I know of a corporation that mobilizes resources from commercial banks, international agencies and SRIs (6.0% fixed annual return of investment) to combat poverty in the country. I also personally know founders of three groups who advocate financial freedom through investing (in stocks, mutual funds, foreign exchange, gold trading). Now if those groups can just integrate SRI from the corporation that I mentioned as an alternative investment vehicle in their program, that can be a big contribution to a more inclusive growth – or what we can call the Bayanihan Economy, as what Habito proposed.
It’s one thing for the students/members of those groups to be financially independent, but through SRI, the investor earns and the poor are also uplifted. Bayanihan happens when the weaker members of the society are helped by those who have the capacity to share the weight of the task. It’s ingrained in our culture, and I hope it transcends even in the financial markets.
Maybe a day will come when we can all pull out our investments from the stock market and allocate it to genuine companies and organizations that adhere to the Bayanihan Economy. I think SRI is the perfect alternative for those without the brains and time for development, but with the heart and money (and want to earn more money) to contribute to nation building.
Originally published on March 6, 2014 at Neil Palteng’s former blog