MUMBAI, January 4, 2011 — Pierre Omidyar, Founder and Chairman of eBay Inc., says he learned a lot from the success of his famous auction website.
For instance, Omidyar told listeners here, if complete strangers can trust each other on an online marketplace, that suggests people are basically good. And if a for-profit enterprise like eBay can spur social change by providing a business platform to poor individuals, then for-profit investments can be just as philanthropic as nonprofit ones.
At the inaugural programme of the O.P. Jindal Memorial Lecture Series, presented by JSW Foundation in collaboration with Asia Society India Centre, Omidyar shared his thoughts on "Next-Generation Philanthropy." He was joined by panelists Jamshed J. Irani, Director of Tata Sons; Ajay Piramal, Chairman of Piramal Enterprises; and Anand Mahindra, Vice Chairman and Managing Director of Mahindra & Mahindra. The event was moderated by Madhabi Puri Buch, CEO and Managing Director of ICICI Securities.
Drawing on the experiences of the Omidyar Network, the philanthropic investment firm he founded with his wife in 2004, Omidyar shared his insights on efficient and effective philanthropic practice. To date, the Omidyar Network has committed more than $270 million to for-profit and nonprofit organizations that foster economic advancement and encourage individual participation. His unique strategy on philanthropy has earned him a reputation as "the Radical Philanthropist."
Piramal cautioned, however, that the most deprived people can't be lifted out of poverty if all areas of philanthropy are motivated by profit. The task then, Omidyar responded, is to find business models that realize a profit only when there is social impact, such as solar power distributors in rural areas. Mahindra added that an economy can't rise in power if people are mired in poverty—helping the poor will drive profits of all enterprises.
Irani focused on the importance of improving delivery mechanisms of philanthropic giving. Buch raised other current issues, such as the microfinance debate on whether it is ethical to make large profits on microfinance loans to the poor, and the pending Indian legislation to make corporate social responsibility (CSR) mandatory for large businesses.
Omidyar said that when considering such issues, his own policy was to remain focused on optimizing the impact of philantrophy rather than the amount. He said that there is "tremendous intellectual capital" in India, but intense need, and that the nature of humanity will drive social innovation to serve it. To this end, he announced that the Omidyar Network plans to invest 200 million dollars in India over the next five years.
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