Empowering Individuals as Smart Funders to Take Poverty to “Zero”

By Angela Rastegar Campbell

Angela Rastegar Campbell

Angela Rastegar Campbell

Next week, the US will celebrate Thanksgiving, a holiday focused on giving thanks and giving back. As charitable giving peaks during this upcoming holiday season, one critical cause to give toward is the monumental task of taking poverty to “zero.”

But with 1.2 billion people living in extreme poverty around the world, addressing poverty will require not just more giving, but smarter giving – to organizations with the most effective interventions.

Generations X and Y are prime candidates for smarter giving – those of us ages 19 to 49 are nearly twice as likely as prior generations to focus on understanding the “return on investment” (ROI) of our donations. We want to use impact metrics to ensure our philanthropy is effective, but smart giving can be difficult as an individual. Evaluating nonprofit impact is time and labor-intensive, particularly when many nonprofits do not publically report key metrics. Transparent, data-driven nonprofits such as GiveDirectly and Evidence Action are in the minority. The lack of an efficient flow of information costs the sector billions of dollars per year, from a combination of marketing dollars spent by nonprofits and research dollars spent by large donors.

Enabling individuals to give wisely, however, is critical in the fight against global poverty. Last year, individuals in the US gave over $250 billion (including bequests) – that’s about 80 times more than the Gates Foundation spent.

Since leaving Dalberg earlier this year, I’ve founded a new platform called Agora Fund to help fill the impact information gap and empower individuals as smart funders. Agora Fund enables individual donors to easily fund measurable results by matching them with a customized portfolio of high-impact nonprofits. Our goal is to understand how global development nonprofits are actually alleviating poverty – rather than measuring day-to-day activities like number of food packets distributed – and to connect individuals with the highest-impact nonprofits based on each donor’s unique theory of change. By collaborating with other experts in the sector, such as Innovations for Poverty Action and the Mulago Foundation, we hope to support the global dialogue around outcomes-based measurement.

Agora Fund’s Poverty Portfolio

Drawing on the UN’s Multidimensional Poverty Index and the draft Sustainable Development Goals that will drive the post-2015 development agenda, Agora Fund believes individual philanthropy can address global poverty through three approaches:

  1. Providing services to meet basic human needs, such as health, food, sanitation, and housing,
  2. Enabling access to resources, such as banking and communication, and
  3. Creating economic opportunity through education and training.

We recognize that interventions using these three approaches only work, however, when they are tailored to local contexts. For instance, what works in sanitation for women and girls in Nepal will vary greatly from what works in Ghana, where cultural norms are extremely different.

In addition to providing individuals with customized information on smart giving, Agora Fund also invites individuals to contribute to a “poverty fund” that we’ve curated, which contains high-impact nonprofits addressing poverty around the world through proven interventions. The nonprofits in this fund report that each donated dollar they receive increases income for poor families anywhere from 28% (in the case of cash transfers) to over 250% (in the case of rural development nonprofits) in just one year.

Ultimately, we hope that by empowering both individuals and high-impact nonprofits, Agora Fund can develop a more efficient philanthropic marketplace and advance global welfare. While the task of combating poverty is daunting, a future without poverty is possible. In the words of UN Deputy Secretary-General, Jan Eliasson, “Our generation is the first with the resources and know-how to end extreme poverty and make sustainable development a reality.” Let’s give wisely to bring about that future.

Angela Rastegar Campbell is a Dalberg alumna and the founder and CEO of Agora Fund, a platform that aims to build a more transparent marketplace for charities. This blog was co-authored with Rachael Gan, an Agora Fund advisor and former vice president at Goldman Sachs.

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Filling the Smallholder Household Data Gap: A New Learning Agenda

By CJ Fonzi and Sara Wallace

When Dalberg and the Initiative for Smallholder Finance set out earlier this year to understand the landscape of impact and risk standards in smallholder finance, what we found was complex. It was a labyrinth of standardized metrics, siloed data sets, and nascent new technologies. As a result, we saw that practitioners and donors seeking to create new appropriate financial products for smallholder farmers had little to no data, particularly on the demand side, on which to base their efforts.

In an effort to help the industry take stock of what we do know, we created a smallholder impact literature wiki and built an interactive map of smallholder finance impact and risk assessment tools. Further, in our industry briefing, Smallholder Impact and Risk Metrics: A Labyrinth of Opportunity, we pointed out that while a large amount of data exists, very few metrics initiatives have focused on catalyzing industry growth. Rather, the lion’s share of efforts has sought to help organizations demonstrate their impact or reduce their risk. There is very little shared knowledge about the smallholder clients that many financial service providers want to reach.

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Filling this information gap will require new efforts and a shared learning agenda. In recognition of this need, Dalberg recently joined colleagues at Root Capital and the Aspen Network of Development Entrepreneurs to establish a new framework for this next phase of metrics and data collection. We call it “Metrics 3.0.”

Articulating this new vision for shared metrics in Stanford Social Innovation Review, we reflected that while metrics platforms and data collection efforts were once focused on accountability and standardization, future success lies in collecting actionable information that drives shared value creation. We presented four opportunities in which metrics and data collection can drive value at the organizational and ecosystem levels. The fourth opportunity—building a learning agenda—seeks to encourage industry collaboration to establish an actionable evidence base around what works. In most impact sectors, funding for market research, pilot projects, and innovation is scarce. Too often, though, isolated actors with similar goals are trying the same approaches, collecting the same information, and pushing the field a single step forward. Coordinated learning agendas and shared knowledge bases will allow practitioners to repurpose what others have already learned and utilize scarce resources to fill information gaps and drive the entire field forward.

Armed with a Metrics 3.0 state of mind, the Initiative for Smallholder Finance and Dalberg recently released a briefing titled Lending a Hand: How Direct-to-Farmer Finance Providers Reach Smallholders that examines the supply side by looking at over 150 finance providers offering finance directly to smallholder farmers. The briefing introduces four distinct business model archetypes that have been successful to date in reaching smallholder farmers and highlights the common practices and challenges financial providers face as they try to reach smallholder farmers with appropriate financial products. The briefing also identifies key next steps in understanding the business model archetypes, opportunities to share knowledge and blend approaches, and areas ripe for innovation.

The Direct-to-Farmer Finance Innovation Space Playbook that accompanies this briefing was informed by new primary research into the demand side of smallholder lending. The playbook introduces five opportunities for direct-to-farmer finance innovation: 1) In-field efficiency, 2) Agronomic learning, 3) Credit assessment, 4) Portfolio diversification, and 5) Individual motivation. The playbook then explores specific innovations underway in each area and uses new primary data to suggest concrete examples of new products, services, and strategies that financial service providers might employ to better meet the needs of smallholders.

CGAP’s efforts to conduct financial diaries of smallholders and to survey smallholder households will fill key gaps in market knowledge, and it’s exciting to see CGAP join Dalberg, the Initiative for Smallholder Finance, Financial Sector Deepening, and others in taking an active role in this learning agenda. As we collaboratively build this knowledge base, we hope to arm financial institutions with the research necessary to develop better products and processes to meet the financial needs of the world’s 450 million smallholder farmers and their families.

This post originally appeared on CGAP. View the rest of CGAP’s smallholder data series here.

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Top Five Takeaways from My Internship in Impact Investing

By Isaac Gross

Isaac Gross

Isaac Gross

“So what did you learn?” my boss asked me in the final week of my internship.

After a summer of struggling to make well-formatted PowerPoint slides, finding out after my final presentation that a fund track record is actually the fund manager’s track record, and navigating the connectivity challenges of West and Southern Africa, I realized that this final check-in was the first time I had actually reflected on my experience. While my initial response was not nearly this well-structured and succinct, here are the top five things I learned during my internship with D. Capital:

1) People matter

To those of you who have been working in the industry for years, this comes as no surprise. However, for those of us entering finance from non-traditional industries that assumed it was more Microsoft Excel and less interaction, this was a pleasant discovery.

2) Bet the jockey

Again, this may seem obvious to people who have been working in investing for years, but I was shocked to find how important management was to investment decisions. I’m not saying that any of the incredible entrepreneurs I had the pleasure of speaking to this summer could run a successful pager business in 2014, but the conversations I had with them were one of the key components of my investment recommendations.

3) Time is money

Over the summer I worked with a number of extremely impressive and equally busy people. I had to quickly learn that their time and attention was a privilege. After 10 weeks, I became very good at preparing for internal and external interactions so that the discussions I was having were productive.

4) It’s a dance

One of my favorite entrepreneurs from my previous career in public health once told me that fundraising was a like a dance. You had to know when to move in and when to back away. I found this advice useful in my conversations with company leadership and was amazed by how good the partners at my organization were in this regard.

5) Trust yourself

If you are interning at a successful organization, which I’m sure many people reading this blog have done or will do at some point, some extremely impressive person has decided that you have the potential to one day become successful as well. You should operate under this premise. You will make mistakes, as I did, but as long as you learn from them and believe in yourself, things will work out.

This article originally appeared in Wall Street Oasis.

Isaac Gross is a member of the 2015 MBA class at London Business School who interned with D. Capital Partners. Click here to see current opportunities to work within the Dalberg Group.

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Helping youth transition from “learning to earning” to reduce unemployment across African countries

By Elizabeth Eze and Dean Segell

By 2050, the youth population (15-24 year olds) across African countries will doubleoutstripping China and India’s combined youth populations - and comprise nearly 20% of Africa’s working population. These young workers in Africa are also obtaining higher levels of education than in the past. According to African Economic Outlook, 65% of Africans between the ages of 20 and 24 will have at least a secondary school education by 2030, up from 46% in 2010.

Youth participate in a digital literacy class in Namibia. Photo via Flickr by the World Bank.

Youth participate in a digital literacy class in Namibia. Photo by the World Bank via Flickr.

The increase in young, educated labor market entrants coupled with Africa’s growing economies have the potential to drive economic and social development in some of the world’s poorest countries. But in order for this to happen, young people must be able to get jobs. Unfortunately, youth unemployment rates across the continent remain consistently high.

The growing youth population will need to overcome two hurdles to employment if it is to support the continent’s economic upswing: the insufficient number of jobs in the labor market, and their inadequate skills sets to qualify for available jobs.

In short, the youth population needs a roadmap to transition effectively from “learning to earning.” While secondary school education is equipping African youth with basic professional skills and the digital literacy required to operate computers, create spreadsheets, and use the internet effectively, employers report that youth lack the soft skills required to work with clients and to receive instruction from senior management.

ICT-enabled jobs contribute to youth employment and empowerment efforts

One particular area presents an opportunity for young people: ICT-enabled jobs. In recent years, the ICT (information and communication technology) sector has been a large driver of GDP growth in many African countries, primarily due to growth in mobile technology and Internet use on the continent. The ICT sector is also creating jobs in Africa. Businesses are increasingly reliant on technology and the Internet, and thisreliance has created jobs in related services fields that African youth are in a prime position to fill. While young workers may not have a depth of workforce experience, they typically possess digital literacy, making them well-equipped to excel in the jobs that ICT has generated.

Prioritizing outsourcing makes employment sense for youth too: the market for employing socio-economically disadvantaged people in outsourcing centers is currently estimated at $4.5 billion and has the potential to reach $20 billion and employ 750,000 people by 2015. In short, outsourced jobs represent important employment opportunities for the growing number of African youth.

Ensuring youth in Africa are equipped to perform new ICT jobs successfully

Digital Jobs in Africa report Dalberg

New report from Dalberg, supported by the Rockefeller Foundation, explores opportunities for digital jobs to ease youth unemployment in Africa.

Despite rising education among Africa’s youth, the number of employees prepared for ICT-enabled jobs (such as those in outsourcing) still falls short, for two reasons: lack of soft skills and lack of work history.

According to employers, many young people lack the soft skills – for example, the ability to interact effectively with clients and co-workers – needed to succeed in these service-oriented positions.

Additionally, employers see young people as less employable when they have lingered in unemployment. For young people, finding employment in the first year after high school seems to be a particularly important indicator of future employment. Youth in South Africa who remain at their first job for more than a year are 85% more likely to avoid becoming unemployed. Meanwhile, early unemployment tends to set youth on a lower-potential path from the outset. Young people who are unable to find work in their first year will earn 21% less in total lifetime earnings than peers who get jobs in their first year after school.

Reaching youth in that crucial first year after school

These figures suggest that youth development initiatives could reap outsized returns by focusing on the transition year between “learning and earning.” Our colleague, Tania Beard, wrote about one approach to bridging this skills gap: civil service.

Dalberg recently supported a Rockefeller Foundation report, “Digital Jobs in Africa: Catalyzing Inclusive Opportunities for Youth,” that highlighted Harambee, an organization focusing on this key year. Harambee trains young people based on employers’ demands for skills and places them in jobs best aligned with their skills. The South African youth accelerator has delivered above-average retention rates for companies and above-average placement rates for youth seeking jobs.

While new jobs in the ICT sector and youth development programs like Harambee cannot singlehandedly solve the youth unemployment crisis in Africa, they are an important first step in priming the rising number of youth workers for success.

For more on Dalberg’s work with youth development, click here.

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Video: D. Talks – Steve Daniels, Founding Director of Makeshift Magazine, on Design and Global Development

By Cecilia Chen and Hanna Seminario

Below, Steve Daniels, IBM Design Lead and Founding Director of Makeshift magazine, talks hacks, informal economies, and Human-Centered Design with Dalberg Video:

In a recent D. Talk, Steve came to Dalberg’s New York office to discuss the intersection of design and development, and particularly, the nexus of the two in informal economies. He explained that informal economies act as “society’s sandbox” where design solutions develop free from political and institutional constraints. Many of today’s innovative industries first appeared as hacks out of necessity in these informal economies. Long before the creation of ride-sharing companies like Uber and Lyft, dollar vans were operating in Brooklyn, NY. CouchSurfing predated the successful room-sharing website Airbnb, and hackers in Accra fused SIM cards so that they operate from multiple providers at least half a decade before phone manufacturers introduced multi-SIM phones.

These innovations also raise attribution questions. The World Intellectual Property Organization asked Makeshift to research applying intellectual property rights to informal economies in Nairobi. He found that a cluster of metalworkers in Kamukunji has informally enforced the opposite for over half a century: encouraging inventors to share their designs and penalizing those discovered to be hiding inventions.

Steve demonstrated that “informal economies push us to test the way we think, work, and govern.” These unlicensed, unregulated businesses may be the world’s biggest design research opportunity, accounting for two-thirds of global employment and an annual $10 trillion in “GDP.”

So how can we incorporate the innovative thinking of informal economies into our own design process? Steve has developed a course, Disruptive Design for Makeshift Cities, for students in the School of Visual Arts’ Design for Social Innovation program to engage with informal economies around them – including dumpster divers, subway performers, illegal goods for sale on Craigslist – as a source of design opportunities. Through Makeshift’s consulting practice, he focuses on Human Systems Design, considering the needs and capabilities of all stakeholders throughout the design process to create an environment that unlocks their potential.

Working in development, we can only hope for our outputs to receive the same uptake as these innovations developed informally by hackers. Perhaps acknowledging the merits of informal innovation and borrowing from their design process – which focuses on present user needs in a resource-constrained situation – could get us closer to the game-changing products Steve has documented on the ground.

Steve Daniels presented at D. Talks, a forum that convenes the development community in cities where Dalberg offices are located. D. Talks aim to drive dialogue and critical thinking on global development issues and create networking opportunities for development professionals.

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Direct-to-Farmer Finance: Business models for serving the hardest-to-reach smallholders

By Laura Goldman

smallholder farmer Kenya

A smallholder farmer in Kenya. Photo by Elyse Marr.

An estimated 90 percent of smallholder farmers lack strong, consistent relationships with buyers – and the access to finance, inputs, agronomic training and other support that typically accompanies those relationships.

The way these smallholders operate – outside a tight value chain, on a relatively small landholding, and with limited commercial activity – makes it difficult for financial providers to reach them. Direct-to-farmer finance is an important pathway through which these farmers can gain access to credit and other financial services that will help them improve their yields and lives. A new briefing from the Initiative for Smallholder Finance, with research from Dalberg, explores the over 150 finance providers who offer finance directly to smallholder farmers globally.

These “direct-to-farmer finance providers” range from state and agricultural development banks, to informal financial institutions, and everywhere in between. Through our research, we observed that providers’ specific approaches to direct-to-farmer finance cluster around four business model archetypes: Build & Integrate, Build & Partner, Leverage & Network, and Extend & Mobilize.

Understanding the following four archetypes can help funders, investors and finance providers better align models across smallholder farmer segments and identify opportunities to address scaling challenges:

1. Build & Integrate: These financial providers aim to fill a market gap by serving primarily non-commercial smallholders with little to no access to finance and farming-related services. Field-based staff deliver financial products, typically developed specifically to support smallholders’ agricultural needs, as well as agronomic training and other support services. The hands-on and field-based nature of Build & Integrate providers’ approach helps them build strong relationships with smallholders and a deep understanding of their financial and non-financial needs. However, this approach also translates to a low farmer-to-field officer ratio of approximately 100-200 farmers per field officer – the lowest observed across archetypes. One example of a Build & Integrate financial provider is One Acre Fund, which is serving more than 180,000 farmers across Kenya, Tanzania, Burundi and Rwanda.

2. Build & Partner: These financial providers also aim to fill a market gap by serving rural populations, including both non-commercial smallholders and commercial smallholders in loose value chains. Similar to the Build & Integrate model, these providers operate in close proximity to clients, delivering financial products through field-based staff. However, Build & Partner providers typically outsource the development and delivery of agronomic training and other support services through formal partnerships. As providers’ staff operate in the field but are primarily responsible for financial activities only, Build & Partner providers typically have farmer-to-field officer ratios of approximately 300-500 farmers per field officer – higher than those of Build & Integrate providers. Juhudi Kilimo, a non-bank financial institution offering asset financing to Kenyan smallholders, is an example of a Build & Partner financial provider.

3. Leverage & Network: These financial providers use existing infrastructure to broaden their client base by serving commercial smallholders, including some in loose value chains. To do so, providers typically deploy existing capital sources (including revenue, client savings and investment capital) and staff to deliver a full set of financial products to smallholders. Most Leverage & Network providers serve smallholders from branches and seek out informal partnerships with other organizations who that can provide training and other agronomic support to their clients. Given these factors, Leverage & Network providers typically have the highest farmer-to-field officer ratios: more than 1,000 farmers per field officer. Opportunity International and its network of financial institutions offering smallholder finance across seven African countries are examples of Leverage & Network providers.

4. Extend & Mobilize: These financial providers are typically member-run organizations set up to meet the needs of the rural communities in which they operate. Thousands of these providers exist – including Village Savings and Loans Associations (VSLAs) and Savings and Credit Cooperatives (SACCOs) – and some have extended their financial product offerings to include agricultural-focused products for non-commercial smallholders. Most Extend & Mobilize providers depend on their existing staff and capital base (typically member savings) to support their agricultural finance activities. Agronomic supporting services are typically member driven and provided more informally on a volunteer basis.

Taking direct-to-farmer finance to the next level

While each business model archetype has strengths and merit, each also faces significant limitations to scale, as our briefing explores in greater detail.

ISF direct to farmer finance playbook

The Direct-to-Farmer Finance Innovation Spaces Playbook outlines specific opportunities for finance providers to innovate and better serve smallholders.

To overcome these challenges and close the enormous gap that persists between demand for and supply of smallholder finance, finance providers will need to share knowledge and blend approaches across business model archetypes. Funders and investors can encourage this activity by supporting knowledge-sharing platforms and activities among providers, and working with individual direct-to-farmer finance providers to experiment with practices more commonly observed in other business model archetypes.

Funders and investors also can support ongoing and future innovation to help providers overcome challenges and scale more quickly. The Direct-to-Farmer Finance: Innovation Spaces Playbook, the latest publication from the Initiative for Smallholder Finance and Dalberg’s Design Impact Group, describes these innovation opportunities in greater detail and suggest compelling new directions in which practitioners could build off of current activity.

This article originally appeared on NextBillion.

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On the International Day of the Girl Child, Boosting Young Women’s Education and Employment in Guinea through Targeted Training Centers

By Marieme Diallo

In Guinea, many girls enter adolescence and young adulthood ill-prepared for their future working lives. When they grow up, these women are disproportionately affected by high rates of unemployment and underemployment compared to men, and are unable to realize their full economic and social potential.

Dalberg recently surveyed 711 young women and a range of private sector companies in Guinea on behalf of UNICEF and USAID to better understand what challenges women face in obtaining employment and how organizations can help young women overcome these challenges. Dalberg also surveyed vocational training centers and other types of training centers to assess whether their offerings are aligned with young women’s needs.

Why can’t young women get jobs?

In Guinea, men’s income is 1.5 times higher than that of women. Photo by UNICEF Guinea via Flickr.

In Guinea, men’s income is 1.5 times higher than that of women. Photo by UNICEF Guinea via Flickr.

Many young women in Guinea have difficulty getting jobs because they do not have the educational qualifications they need to enter to the job market.

Our study found that only 54% of Guinean young women between the ages of 15 and 24 are literate, compared with 68% of men. Additionally, 60.7% of adolescent girls are not in school at all. The overall school life expectancy for young women is seven years, while it is ten years for young men. Education attainment for young women most likely lags due to the combined effects of late school entry and early pregnancy – in fact, more than one in four young women in Guinea between ages 15 and 19 already have a child.

Girls’ educational disadvantage at a young age translates to an employment disadvantage when they grow to be women seeking jobs. Women are largely excluded from higher income and employment in both formal and informal sectors; in fact, men’s income is 1.5 times higher than that of women. Young women’s lack of formal educational attainment also affects the type of jobs they can acquire. Our surveys indicated that girls feel forced to work jobs traditionally associated with women, such as sewing, hairdressing, and catering. Because girls are more hesitant to branch into jobs such as mechanic, civil engineering, and transport, their job opportunities are even slimmer.

How can young women overcome these barriers to employment?

Our research found that for young women to obtain employment at a pace on par with young men in Guinea, they must acquire certain key skills – many of which they can gain from programs at targeted training centers. With the help of training centers, women can:

Our study of the labor market found that many of the most promising employment opportunities range from manual to technical jobs in the agriculture, mining, construction, and tourism sectors. To get these jobs, however, young women need to acquire the specific vocational skills important to these employers, such as digital literacy, professional and personal maturity, analysis capabilities, creativity, writing skills, and the ability to work independently.

Skills training, set in an environment that supports women working in many industries, will help Guinea make the most of its young female workforce. Photo by Jean-Michel Volat via Flickr.

Skills training, set in an environment that supports women working in many industries, will help Guinea make the most of its young female workforce. Photo by Jean-Michel Volat via Flickr.

Acquire technical and professional skills. Our study of the labor market found that many of the most promising employment opportunities range from manual to technical jobs in the agriculture, mining, construction, and tourism sectors. To get these jobs, however, young women need to acquire the specific vocational skills important to these employers, such as digital literacy, professional and personal maturity, analysis capabilities, creativity, writing skills, and the ability to work independently.

>> How training centers can help: Training centers need to align their curricula with market needs in order to help women acquire technical and professional skills to become competitive in these job markets.

Gain entrepreneurial skills. Though fewer than 10% of the training centers surveyed offer entrepreneurship courses, the survey respondents (young women and private sector employers) expressed a strong demand for programs to help young women take advantage of market opportunities that require them to be more entrepreneurial.

>> How training centers can help: Training centers can step up to the challenge by promoting entrepreneurship through theoretical and practical modules that teach young women key skills such as knowing how to analyze a problem, formulate and communicate an idea to address that problem, and find the necessary resources to implement that idea. These skills are both core to entrepreneurship and to success in other emerging labor markets.

Improve self-confidence and professionalism. Private sector employers we interviewed reported that the factors most limiting the employability of women are a lack of professionalism – capacity to deliver a task efficiently and effectively – and a lack of confidence in their abilities.

>> How training centers can help: Life skill modules within training centers should focus on improving young women’s self-confidence, decision-making capabilities, and communication skills. Training in life skills can also protect young women against other factors that increase their vulnerability in the labor market. It is important, for example, that women receive training in reproductive health and, for those who are mothers, good childcare practices.

Receive support from their peers. While young women’s skill sets certainly affect their employment prospects, their external environments matter, too. For example, 80% of young women report that their behavior is influenced by religion and tradition. Furthermore, 54% believe that traditionally female-dominated jobs such as trade, hairdressing, sewing, and catering are specifically reserved for them.

>> How training centers can help: Programs that train young women can encourage young women to seek out jobs traditionally reserved for men, such as carpentry and plumbing. This diversification will create more job opportunities for women by normalizing the concept of women working these jobs.

Next steps to improving young women’s education and employment 

Skills training, set in an environment that supports women working in many industries, will help Guinea make the most of its young female workforce. Driven by the results from Dalberg’s research, UNICEF and USAID are developing a new set of training centers to help 1,350 Guinean young women gain the technical, entrepreneurial, and life skills that are crucial for their future employment. We also recommend that UNICEF and USAID organize and conduct events for young women and their parents to explain the importance of vocational training and openly discuss topics such as religion and tradition.

While these programs are still in a test phase, they might eventually extend to serve 10,000 young Guinean women. In the spirit of the UN’s International Day of the Girl Child coming up tomorrow, we hope these programs can become an important model for improving young women’s employment opportunities around the world.

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Why We Need Innovative Financing: Innovative Financing’s “Bridge” Role in Economic, Social, and Environmental Development

By Sam Lampert and Serena GuarnaschelliInnovative Financing for Development Report

As the development agenda came under the spotlight at last week’s UN General Assembly in New York, one thing became clear: the future we want – a future that meets the needs of people and the planet – will require investments estimated in the trillions of dollars over the next ten years.

Securing and mobilizing that investment will not be an easy task.

But the concept of innovative financing – which focuses on programs that deliver results and supports collaboration between the public and private sector – may present at least part of the solution.

A new report, titled Innovative Financing for Development: Scalable business models that produce economic, social, and environmental outcomes, was released today by Dalberg and the Global Development Incubator. Funded by the Citi Foundation and the Agence Française de Développement, it describes the innovative financing landscape and how expanded use of these mechanisms can promote development outcomes. The report aims to accelerate the growth of innovative financing by creating a common language and vision for leaders in both the public and private sector to use as they explore innovative financing opportunities to drive positive social and environmental impacts.

What is innovative financing?

Innovative financing instruments do not replace, but rather complement, traditional resource flows such as aid, foreign direct investment and remittances. By addressing specific market failures and institutional barriers, innovative financing can mobilize additional resources to eliminate poverty, raise living standards and protect the environment.

Innovative financing encompasses a broad range of financial instruments and assets used for global development. We estimate that innovative financing instruments mobilized nearly $100 billion and grew at 11 percent per year between 2000 and 2013. Innovative financing is unique because it can attract private companies that want to expand into new markets; investors and fund managers who want to create both financial and social returns; and governments that want to achieve more and better development impact in a resource-constrained environment.

Most of these mechanisms combine public and private sector resources and expertise; successful innovative financing creates incen­tives for private companies to invest in projects that benefit people at the base of the pyramid or support the environment.

One example of successful innovative financing is the Pneumococcal Advance Market Commitment (AMC), sponsored by the GAVI Alliance. Pneumococcal vaccines are complex and usually reach low-income countries a decade or more after introduction in industrialized nations. Yet each year pneumococcal disease kills half a million children under the age of five. Through the Advanced Market Commitment, donors, including the Gates Foundation, pledged $1.5 billion to guarantee a low price for two billion doses of pneumococcal conjugate vaccine (PCV) from pharmaceutical manufacturers.

A child receives a pneumococcal vaccine in Kenya. Photo by TED Conference via Flickr.

A child receives a pneumococcal vaccine in Kenya. Photo by TED Conference via Flickr.

The Advanced Market Commitment reduced market uncertainty, encouraging manufacturers to speed up the development and availability of vaccines. In exchange for the upfront funds from donors, the manufacturers agreed to sell the PCVs to low-income countries at a price no greater than $3.50 for the next ten years – a price that is 90 percent lower than the price of PCV in high-income markets.

Other examples of innovative financing include the World Bank’s green bonds, the Global Health Investment Fund, the Multilateral Investment Guarantee Agency, and development impact bonds.

In defining innovative financing, it also helps to note that it is different from financial innovation. Established financial instruments, such as guarantees and bonds, constitute nearly 65 percent of the innovative financing market. While new products dominate many conversations about innovative financing, most resources mobilized through it use existing products in new markets, or involve new investors. Our definition of the “innovation” aspect of innovative financing includes the introduction of new products, the extension of existing products to new markets, and the presence of new types of investors.

So how does innovative financing create value?

Innovative financing mechanisms address specific market failures and institutional barriers that hinder global development.

Often, innovative financing instruments reallocate risks from investors to institutions better positioned to bear the risk and, in the process, enable participation from mainstream investors. In the case of the AMC for pneumococcal vaccines, pharmaceutical companies were more motivated to conduct vaccine research and produce vaccines for developing countries because they had the advance guarantee from donors that those vaccines would be purchased.

The AMC for pneumococcal vaccines, while promising, is a single instrument sponsored by donor governments and philanthropies that has not yet been widely replicated. In order to achieve scale and attract private capital, innovative financing instruments need relatively simple financial structures and a proven track record that clearly describes the expected financial and social returns. For example, the World Bank’s issuance of green bonds to finance investments in low-carbon infrastructure has grown quickly because they are evaluated using standard risk models, provide a risk-adjusted return that meets investor expectations, and also offer investors the opportunity to be associated with a positive environmental outcome.

What are the next steps in innovative financing?

The focus of innovative financing is shifting from the mobilization of resources through innovative fundraising approaches – an approach commonly associated with traditional development finance – to the delivery of positive social and environmental outcomes through market-based instruments that are more sustainable.

In our report, we anticipate three primary drivers of growth in the innovative financing sector:

  • Increased use of established financial instruments. Established instruments that investors can evaluate through existing risk frameworks, such as green bonds, will attract new participants including pension funds and institutional investors. Channeling the proceeds of these instruments to productive development goals will require new standards that specify how funds can be used most effectively.
  • Expansion into new markets through growth of replicable products. Over the past ten years, the international development community has experimented with new instruments such as performance-based contracts. These instruments do not yet have the track record to attract institutional investors, but offer promising opportunities to improve development outcomes in new sectors.
  • Creation of new innovative financing products. Finally, we have seen the emergence of new products, such as development impact bonds, that are promising, but are still in their early stages. While these products will remain a small portion of the market in the short-term, we encourage donor governments and other funders to continue experimenting with these products so they can mature into the next important asset class.

Meeting global commitments to eradicate poverty and to respond to climate change will require all possible sources of financing. Through its combination of private sector approaches to achieving risk-adjusted returns and a philanthropic orientation to producing social impact, innovative financing is a critical “bridge” to address the most pressing global economic, social and environmental challenges.

If you are interested in joining the conversation or learning more, contact innovativefinance@dalberg.com.

This article was previously posted on NextBillionBusiness Fights Poverty, and Skoll World Forum.

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INFOGRAPHIC: How Green is the Internet?

By Tania Beard, Libby Bova, and Gill Cassar

In recent years, the media has buzzed with stories applauding the Internet as a driver of economic growth, efficiency, and social change. Dalberg’s own report, The Impact of the Internet in Africa, added to the buzz with its examination of Internet-created opportunities in Ghana, Kenya, Nigeria, and Senegal.

Less discussed, and perhaps more equivocal, is the impact of the Internet on the environment. We examined this relationship and found that there are dark and bright sides to the Internet’s impact on the environment: the Internet contributes significantly to environmental degradation, yet also drives innovations that reduce humans’ carbon footprints.

Our research, presented in the infographic below, offers answers to the question, “How Green is the Internet?”:

Infographic: How Green is the Internet?

For more information on Internet-enabled innovations that can reduce your carbon footprint, click here.

To read more about how the Internet is enabling economic growth and social inclusion in other sectors, click here.

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List of September Events around the UN General Assembly (UNGA), Clinton Global Initiative (CGI) Annual Meeting, and Aspen Network of Development Entrepreneurs (ANDE) Annual Conference

By Dean Segell

New York City is set to host a collection of development events this September. With the United Nations General Assembly (UNGA), Clinton Global Initiative (CGI) annual meeting, and the Aspen Network of Development Entrepreneurs (ANDE) annual conference all taking place, it’s a unique opportunity for joint thinking and coordination.

We’ve put together the below database of side events to the UNGA, CGI annual meeting, and ANDE annual conference as a resource to help the global development community get together, collaborate, and plan during these key weeks.

Our list is by no means comprehensive, so we encourage you to suggest additional events in the comments section and we will add them to our database.

Side Events Around CGI, UNGA, and the ANDE Annual Conference

Overview   Details
Event name Organizer Description Date & Time Type
HABITAT III: The Role of Design – A Path to Sustainable Urbanization Consortium for Sustainable Urbanization, American Institute of Architects, UN-Habitat Event will focus on the role of design at HABITAT III Fri 12 Sep 18:00-20:00 RSVP (free)
Investing in Impact-Driven Leadership with Jacqueline Novogratz NY+Acumen Event to discuss the importance of leadership and building a cohort of impact-driven leaders Mon 15 Sep 17:30-20:30 RSVP ($75)
Thinking Inside Out – How Cities Contribute to Solving Global Problems The New School, Observatory on Latin America, Penn Institute for Urban Research, UN-Habitat Side event to the United Nations’ Preparatory Committee Meeting on Habitat III Tue 16 Sep 14:00-17:00
New York Launch of the New Climate Economy at the United Nations UN, The New Climate Economy Launch of Better Growth, Better Climate: The New Climate Economy Report Tue 16 Sep 09:00-10:30 RSVP (free, closed)
Right to the City for All – Building a Global Platform towards Habitat III Habitat International Coalition Event aims to promote cross-sector dialogue to strengthen international coordination and mobilization for the construction of a Global Platform for the Right to the City, to influence the definition of the New Habitat and Urban Agenda in the HABITAT III Conference and the SDGs Tue 16 Sep 15:30-17:30
Inside Energy Summit SolarCity Inside Energy brings together business leaders, thought leaders, and policy leaders for an insider look at the latest trends in energy and sustainability Wed 17 Sep 12:00-18:30 Invite only
Services, Human Rights and Inclusion in an Urbanizing World UNFPA Event will examine service delivery and social protection in the context of rapid urban transitions Wed 17 Sep 08:30-09:30 Invite only
Linking Public Transportation to a New Urban Agenda Institute for Transportation and Development Policy Event will show how to optimize the contribution of mobility policies for the successful delivery of Habitat III’s New Urban Agenda Wed 17 Sep 08:30-09:30 Invite only
Cities that Work for Everyone: Inclusion, participation, and
partnership in the new urban agenda
Huairou Commission Event will facilitate a multi-stakeholder dialogue on the non-negotiables of an urban agenda that works for grassroots women, communities, and local authorities Wed 17 Sep 13:30-14:30 Invite only
Priorities for HABITAT III in the UNECE region UN Economic Commission for Europe – Committee on Housing and Land Management Event will monitor progress on the implementation of the UNECE Strategy on Housing and Land Management in the ECE Region 2014-2020 Wed 17 Sep 13:30-14:30 Invite only
Seizing the opportunity for global partnerships: Exploring outlooks, expectations and opportunities for Habitat III to make cities inclusive, safe, resilient and sustainable Cities Alliance Event will discuss four key areas of the Cities Alliance in promoting equity in cities: equitable city growth, responding to informality, promoting good governance and city resilience Wed 17 Sep 18:30-19:30 Invite only
Eliminating Constraints to Urban Land and Property Ownership by Women: A Practical Perspective International Housing Coalition Event presents different approaches to eliminating legal, political, social, and customary barriers to women owning land and property Wed 17 Sep 18:30-19:30 Invite only
2nd Annual International Conference on Sustainable Development Practice Sustainable Development Solutions Network, Global Association of Master’s in Development Practice Programs Event is chance to share and identify practical, evidence-based solutions that can support the SDSN leadership in shaping the post-2015 agenda Wed 17 Sep – Thu 18 Sep 08:00-18:00 RSVP (free, closed)
HABITAT III – First PrepCom Habitat III First session of the Preparatory Committee of the third UN Conference on Housing and Sustainable Urban Development Wed 17 Sep – Thu 18 Sep All day
From MDG to SDG: Towards a New Paradigm at Habitat III Communitas Coalition and the Penn Institute for Urban Research Event will discuss development of an SDG on Cities & Human Settlements Thu 18 Sep 08:30-09:30
Harnessing the Potential of Public Space for Women and the Youth UN-Women Event will discuss how public space can promote gender equality, women and youth empowerment, human rights, inclusiveness, and the elimination of gender-based violence and gender-based stereotypes. Thu 18 Sep 08:30-09:30
Local and regional governments’ contributions to Habitat III: priorities, expectations, and challenges for sustainable cities and territories United Cities and Local Governments Event will provide the opportunity for local authorities to reiterate their commitment to contribute to Habitat III Thu 18 Sep 13:30-14:30
Advancing opportunities for Global Lessons in Creating a Community Resilience
and Urban Livability
Municipal Art Society of New York Event will bring together local practitioners including architects, planners, community business leaders, and activists, to discuss lessons learned from Sandy, and opportunities to share these lessons globally Thu 18 Sep 13:30-14:30
Africa investor CEO Investor Relations Masterclass Africa Investor, FINEO Discussion of Africa’s increased investment attractiveness Fri 19 Sep,
Mon 22 Sep All day
RSVP (no date, investors only, £1,995)
Financing Resilient Cities The Gold Standard Foundation and Climate Action Event will examine how investment can be effectively mobilized to support integrated, and socially responsible, low carbon urban development programs that can be replicated worldwide Sun 21 Sep 18:30-20:30 Invite only
Social Good Summit 2014 Mashable, UN Foundation, 92Y, UNDP, Bill & Melinda Gates Foundation Conference examining the impact of technology and new media on social good initiatives around the world Sun 21 Sep – Mon 22 Sep All day RSVP (tickets, price unknown)
Women Leaders Forum 2014 Global Partnerships Forum, Advanced Development for Africa Foundation Connecting Women’s Health and Girl’s Education for Scalable
and Sustainable Development with a special focus on Youth Education, Health and Entrepreneurship
Mon 22 Sep 09:00-12:55 Invite only
African Heads of State and Government Investment Working Lunch Africa Investor, Global Partnerships Forum Dialogue between business and government leaders on practical investment partnerships that support investment in the African continent and facilitate African regional economic integration Mon 22 Sep 12:00-14:00 RSVP (No date, only for investors)
The Global STEM Alliance International Launch New York Academy of the Sciences, Global Partnerships Forum Empowering the next generation of scientific innovators Mon 22 Sep 15:00-18:00 Invite only
Ai CEO Institutional Investment Summit 2014 Africa Investor, New York Stock Exchange Event will profile leading African capital market opportunities to African and global pension fund investors through high-level panel discussions and interactive one-on-one meetings Mon 22 Sep All day RSVP (free, investors only)
Ai Index Series Awards 2014 Africa Investor, New York Stock Exchange Event will profile African capital market success stories Mon 22 Sep All day RSVP (free, investors only)
Women Leading Solutions on the Frontline of Climate Change Women’s Earth and Climate Action Network Event will provide a platform for strengthening the network of women who are at the forefront of the transition to a just and sustainable future Mon 22 Sep 13:00-15:00 RSVP (free)
Action in Climate Change and Health UN Climate Summit and others Engaging thought leaders at the intersection of climate change and health across multiple sectors Mon 22 Sep 08:00-14:00 Invite only
Climate Week NYC Opening Day Climate Week NYC Discussion of how leadership and innovation can converge to drive carbon emissions down and clean economic growth up Mon 22 Sep 10:00-17:45
City Climate Leadership Awards C40 Cities The C40 & Siemens City Climate Leadership Awards provides global recognition to cities that are demonstrating climate action leadership. Mon 22 Sep
House of Green Opening Event Urban Future Lab, Confederation of Danish Industry Official Opening of the House of Green Exhibition at the Urban Future Lab – New York´s premier center for the cleantech community. Mon 22 Sep 17:00-19:00 Invite only
Leader’s Forum on Women Leading the Way: Raising Ambition for Climate Action UN Women, the Mary Robinson Foundation Event aimed at mobilizing action by governments, business, finance, and civil society in areas that will enable the world to shift towards a low-carbon economy Mon 22 Sep 18:00-22:30 Invite only
OECD and CPI dialogue event: Improving transparency & accountability through improved tracking Climate Policy Initiative, OECD This event aims to help boost transparency and accountability in the tracking of climate-related development finance from public and private sources Mon 22 Sep 17:00-19:00 RSVP (free, 18 Sep)
The Forest and Climate Challenge: Business, Government and Indigenous Leaders call for action Ford Foundation Diverse panel will talk about the actions they are taking to reduce deforestation and associated conflict to the benefit of local communities, the bottom line and the climate Mon 22 Sep 14:30-16:00 Invite only
Sustaining Health: Linking Environment, Nutrition and Health Welcome Trust Event will explore the interface between nutrition, environment and health, and how science and technology can address the challenges we face Mon 22 Sep 14:30-18:00 Invite only
High-Level Expert Workshop: “Food Crops for Agriculture in a Changing Climate: an Expert Communiqué” International Treaty on Plant Genetic Resources Workshop to address the challenge of producing more – and more nutritious – food on less land, with less water and less energy, and in an increasingly challenging climate Mon 22 Sep 15:00-18:00
Equator Prize Award Ceremony UNDP Prize is awarded biannually to recognize and advance local sustainable development solutions for people, nature and resilient communities Mon 22 Sep 18:30-22:00 RSVP (free)
World Conference on Indigenous Peoples UN Event for sharing perspectives and best practices on the realization of the rights of indigenous peoples, including pursuing the objectives of the United Nations Declaration on the Rights of Indigenous Peoples Mon 22 Sep – Tue 24 Sep All day RSVP (closed)
Climate Summit 2014 The New Climate Economy The Secretary-General will host a summit as an integral part of his strategy to engage leaders and advance climate action and ambition Tue 23 Sep All day Invite only
Innovating for Impact: The MDGs and Beyond UKaid, USAID Event to showcase the role of innovation in catalyzing progress towards achieving the MDGs and in shaping the future of global development Tue 23 Sep 14:00-17:00 RSVP (free, 12 Sep)
UN Private Sector Forum 2014 UN Event will focus on carbon pricing, specifically to achieve an equitable and fair valuation of carbon through long-term strategies, investments and policies Tue 23 Sep 11:30-15:15 Invite only
Side Event at Climate Change Summit: “Food Crops for a Changing Climate” International Treaty on Plant Genetic Resources Tue 23 Sep 13:15-15.30
Innovative Financing Leading Group, UN Event to discuss innovative financing: a solution to diversify the financial toolbox for sustainable development and climate Wed 24 Sep Afternoon
Business Call to Action Fifth Annual Forum UNDP Forum to bring together chief executives from prominent Business Call to Action member companies and senior representatives from governments, bilateral donors, civil society, and the United Nations Wed 24 Sep All day
Ending Poverty: Why Strong, Accountable Institutions Matter UK Government, Transparency International Event will focus on the importance of accountability and transparency in eradicating poverty and promoting sustainable development Wed 24 Se 11:30-3:00p Invite only
Creative Power: New models for growing clean energy investment The Climate Group, Bloomberg, Swiss RE Event will explore: How are investors, insurers, governments and financiers working to de-risk clean energy projects? Wed 24 Sep Invite only
Building Innovative and Sustainable Index Insurance Markets IRI, World Bank Discussion of “Building Innovative and Sustainable Index Insurance Markets in Developing Countries” Wed 24 Sep 09:00-13:00 RSVP (free)
Fourth High-Level Round Table on the ITPGR International Treaty on Plant Genetic Resources Discussion of how to support agricultural innovation for breeding climate-smart seeds; climate change impacts on food crops; and showcase the value of the Treaty’s Benefit-sharing Fund and its projects Wed 24 Sep 11:00-13:00
Curbing illicit financial flows for domestic resource mobilization in the post-2015 era OECD, Australia, and Mexico With the proposed target by the UN OWG to significantly reduce by 2030 illicit financial flows as background, this Side Event aims to identify concrete international actions needed in key areas for achieving this target, such as international tax evasion and avoidance, money laundering, bribery, and asset recovery. Wed 24 Sep 11:00-13:00
Colloquium on Forests and Climate: New Thinking for Transformational Change Center for International Forestry Research Event to promote discussion on future priorities for research in forest and landscape governance and on the valuation of ecosystem services Wed 24 Sep 14:00-15:00 RSVP (free)
Redesigning Development Finance World Economic Forum Discussion of how to harness development, investor, and philanthropic resources in a strategic, deliberate fashion to achieve exponential social impact through sustainable, investable, scalable enterprises and projects. Wed 24 Sep 15:00-17:30 Invite only
World Summit on Indigenous
Philanthropy
International Funders for Indigenous Peoples Event aims to establish the best, most efficient ways to practice indigenous philanthropy, whereby indigenous peoples are our equal partners and not passive receivers Wed 24 Sep – Fri 26 Sep All day RSVP (free if  eligible)
High-level panel debate, “Health Care and Violence: The Need for Effective Protection” International Committee of the Red Cross Event for discussion of health care and violence Thu 25 Sep 9:00-10:30 Invite only
Corporations Leading Climate Resilience Around the World ND-GAIN Event for learning about global adaptation innovation and best practice Thu 25 Sep 17:00-18:30 RSVP (free, Sep 24)
Indoor Air Pollution UN Forum to mobilize partnership and increase awareness of the impact of indoor air pollution among women and low income households in Africa Thu 25 Sep 09:00-17:00 Free
Innovative Strategies for Living with Climate Change The Rockefeller Foundation, BBC Media Action A discussion of creative, context-sensitive solutions for coping with changing weather across Africa and Asia Thu 25 Sep 10:00-12:00 Invite only
CGIAR Development Dialogues CGIAR Discussion of the role that crop and animal agriculture, forestry and fisheries will play in achieving sustainable development and shaping the post-2015 agenda Thu 25 Sep 10:00-18:30 Invite only
Business Forum on Ocean Policy & Planning World Ocean Council Forum to catalyze informed, coordinated and proactive Ocean Business Community engagement in the ocean policy and planning efforts which will significantly impact future ocean economic activity Mon 29 Sep – Tue 30 Sep All day RSVP (Sep 28, $610)
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