Corporates Should Support the Rule of Law

Corporates Should Support the Rule of Law

January 16, 2020 | CSR

The time has come to align self-interest and public interest in support of the rule of law and constitutional values.

I have often talked about the continuum of sarkaar, samaaj, and bazaar, and why, for a successful society, these three sectors must work together in a fine balance.

Ideally, sarkaar, or the state, should not grab too much power, bazaar, or the market, should not flout the rule of law or appropriate public resources, and vigilantes from the samaaj, or civil society, should not take the law into their own hands.
This requires awareness and active participation from all citizens. After all, we are citizens first; our primary identity is not as a subject of the state or as a consumer for the market. As citizens, how do we then help build a good society?

The bazaar’s interest in the rule of law

There are many interests between samaaj and sarkaar; bazaar and sarkaar; as well as between samaaj and bazaar. For the purpose of this article, we will examine the congruence of interest between samaaj (society) and bazaar (markets). And it starts with the rule of law.

“No business can thrive without social stability outside its gates.”

We all want and need the rule of law to be upheld. In fact the bazaar—or at least the modern corporation as we know it—would not exist if the rule of law had not created the limited liability company 300 years ago. This allowed innovation to flourish over the centuries, and also provided for the absorption of failure, because wherever there is innovation, there is failure. It is because of the rule of law that companies can fail without going under themselves; and therefore, for their own sake, corporations have a great stake in upholding it. They need the enforceability of contracts, protection of property, availability of fair competition, and so on, otherwise they simply cannot function. But even beyond this, they need the law to be upheld by society at large, because no business can thrive without social stability outside its gates.

Civil society and business therefore have more in common than either believe. Sure, in some cases, civil society has to position itself against business interests, when those interests are being deployed unfairly on the ground. For instance, in the case of public goods like water and land commons, or with environmental issues like pollution and contamination, civil society and business knock up against each other. But they also have a common concern—to keep the sarkaar in check.

Keeping the sarkaar in check

State power worldwide tends to accumulate, and it is to the advantage of both business and civil society, to make sure that the state does not abuse its own power.

Many corporations have been subject to the vagaries of state power while running their businesses; excessive discretionary power also adversely affects the climate in which businesses operate. If the alignment of samaaj and bazaar is understood and worked on, it helps restrain the state.

For example, civil society institutions and business corporations might together, or separately, appeal to the state on poorly framed laws. In the recent proposal to criminalise non-compliance of CSR, both samaaj and bazaar would have been adversely affected.

Both successfully voiced strong reservations against it, and it was rolled back.

“We all need good laws, and an independent, impartial, and efficient judiciary to verify the constitutionality of those laws.”

We all need good laws, and an independent, impartial, and efficient judiciary to verify the constitutionality of those laws. We all require equal access to the justice system. We also need effective public institutions that help uphold the rule of law. It is the only way to both empower the bazaar and uphold the rights of the country’s citizens.

The samaaj has an interest in the rule of law as well, as it is critical for addressing access issues, especially for the poor. Civil society organisations (CSOs) representing samaaj are often driven by passion and a commitment to rights and freedoms.

Sometimes, at great personal risk, they go up against the power of the state and corporations, to create campaigns, build institutions, and push for more agency for people who are left out. Civil society must however learn to communicate better the long term benefits of such work to business.

Because, the bazaar itself cannot do this work. Though they benefit indirectly, corporations cannot support or implement politically sensitive programs, and risk the fallout of such action. It would make them vulnerable to all sorts of state action.

But they can certainly do more than what they’re doing at the moment.

With the civil society institutions that they trust and already have a relationship with, they can, and should, give core institutional support to continue work beyond project-based funding. Even if they do just this, it strengthens civil society capacity to take on issues of rights and exclusions that are adjacent to their work on service delivery.

It’s time to take big bets

Swami Vivekananda said, “Take risks in your life. If you win, you can lead, if you lose, you can guide.”

Indian philanthropy doesn’t take enough risk. However, it cannot achieve its potential without risk-taking. It’s good to keep honouring service delivery improvements, but it’s time to look at our society as a whole, and for the philanthropic sector to step up and get into more important areas such as access to justice. And the congruent interest of samaaj and bazaar is exactly why.

From a recent Boston Consulting Group report—‘Total Societal Impact- A New Lens for Strategy’, it’s clear that corporations which align with samaaj’s ideals will be better off in the long run. There is now exhaustive research that shows that the non-financial side of business is linked to its financial side, and that companies that do well when it comes to ESG—environmental, social, and governance issues—also consistently show better results on their bottom line.

Can we—as corporations and philanthropists—pledge that we will no longer do only incremental work, but will try something transformational? The time has come to align self-interest and the public interest in support of the rule of law and constitutional values.

The common within uncommon ground

It doesn’t have to be the state versus civil society, or business versus civil society, or the state versus business. They are not neccessarily antithetical to each other.

Society is successful when it reduces the friction for the three to co-create solutions. And it’s important for all the three sectors to recognise that—to discover the common within the uncommon ground.

It is an especially opportune time for business and civil society to act more creatively from their own, unrecognised common ground. Poised at a new decade, we can together ensure that this country’s solemn promise to itself—to secure liberty and justice, social, economic, and political—for all its citizens, will be met, and met in abundance.

India Development Review

Times of India


Hindustan Times

Hindustan Times PDF

Five Ideas On Reimagining Philanthropy with Societal Platform Thinking

Five Ideas On Reimagining Philanthropy with Societal Platform Thinking

December 6, 2019 | Philanthropy

Rohini Nilekani, chairperson, Arghyam, shares five ideas on reimagining philanthropy with societal platform thinking

2020 has captured the imagination with its promise of being near enough to set achievable targets, yet distant enough to envision transformation. With the end of 2019 weeks away, Mint invites thought leaders to share their vision for the next decade. Rohini Nilekani, chairperson, Arghyam, a foundation for water security, shares five ideas on reimagining philanthropy with societal platform thinking.

Design for scale from the start
What works at scale may be different from scaling what works. Pilots often succeed, while scale-up often fails when the context changes. We have to design for scale even if it’s a small implementation. This requires a technology backbone. We can’t start from the technology; we have to first define the problem correctly. Then we will be technology-enabled, not technology-led.

A unified but not uniform structure
Complex societal issues need creative collaboration between samaaj, bazaar and sarkar. Design to reduce the friction for such collaboration using a platform approach, where each sector can contribute what they do best, and pool knowledge back onto the platform. A unified but not uniform structure allows contextual responses and diversity at scale.

Let go of control, allow innovation
No single institution or effort can effectively create solutions for societal problems. Let go of control over the idea; don’t hold on to the data. Focus on building open public digital goods. Allow others to innovate on top of your own innovation. That is the only way in which we can get ahead of the problem. Missions must scale even if organizations occasionally fail.

Distribute the ability to solve
When one solution is pushed down the pipe, it prevents the discovery of others. People everywhere have ideas suited to solve their own problems. If we can create shared infrastructure and toolkits, it builds local capacity. People can become part of a solution rather than remaining part of the problem, or dependent on someone else’s solution.

System stewards as positive catalysts
Any societal platform needs a bold steward, willing to hold the moral compass and risk failure. A system steward must persist as a positive catalyst that continuously creates opportunities and sustains the grammar of the intent. Issues of governance and accountability have to be managed.This is a call to action for some of our most wealthy philanthropists to become system stewards.




Rohini Nilekani: On my journey as a philanthropist

Rohini Nilekani: On my journey as a philanthropist

November 22, 2019 | Philanthropy

This is an edited version of a speech delivered by Rohini Nilekani to a closed door gathering of Asian philanthropists.


Most of us in this room are on a journey of discovery as philanthropists. We recognize that we have been lucky, we are fortunate to have wealth way beyond our needs. We want to use that wealth not just to satisfy our own whims but also to act as trustees of that wealth for the public good.

A journey of a thousand miles begins with a single step, as Lao Tse Tung famously said. For me, that step can be described as a restlessness. Since I was very young, I wanted to help create positive change. I was unhappy with the state of society in my country, India, where there was so much injustice and inequity, where there was so much poverty and lack of opportunity. I did not want to live in a society like that. I wanted to live in a better society, where there was more hope and more justice. I did not know then that I would find my way to extreme wealth and unprecedented opportunity to be part of the change I was seeking. But I did know that I would have to do something with my life that reflected my desire for the good society, or samaaj, as we call it.

All of us have influencers that shape our thinking and our action. In my case, one of the earliest influences that was the oft repeated story of my paternal grandfather, Babasaheb Soman, who showed exemplary commitment to the larger public interest all his life, first as a lawyer who encouraged out of court settlements without a fee, then as a follower of Gandhiji during the freedom movement.

Later as a journalist, I was able to meet thinkers, policy makers and report on various issues of society for the media organizations I worked at. That too helped me understand how ordinary people deal with all the challenges they face. I call the FIRST MILE, and I try even today to keep my ear to the ground.

My husband co-founded a software company in 1981, and I was lucky enough to be able to invest in it, as my husband did not have much money then! This small amount of Rs 10,000 or 1000 yuan that i put into Infosys from my savings later turned me into a wealthy woman. I must admit that it took me years to adjust to my wealth. In India, middle class people, like I was, look at wealth with great suspicion! It took me a while to figure out that in fact, I could use this wealth for precisely the kind of activism I wanted to engage in, to be part of the better society I yearned for. So my husband became an accidental entrepreneur and I became an accidental philanthropist.

Once I had internalized that, I moved quickly. I co-founded two organizations in the early 2000’s. The first was Arghyam, to help me learn to do philanthropy better. By 2005, after many experiments, we decided to focus on water, and for the past 14 years, we have been supporting good organizations all over India to improve people’s access to sustainable water. Our work has had significant policy impact, and we have worked closely with state governments and the Union government as well. In our latest avatar, we are attempting a shift from incremental to exponential by helping design a shared infrastructure for the water sector in india, especially for capacity building and data management. It is scary, it is risky, it is outside our comfort zone as an organization, but it fulfills the true role of philanthropic capital – which is to underwrite risk and innovation. So even if we fail, it is still the right thing to have tried.

The second organization I co-founded and funded in 2004 was Pratham Books. I gave it the grand vision statement of “A book in every child’s hand”, so that we were born as a scale organization, determined to be not just a not for profit publisher, but to disrupt the whole ecosystem of children’s publishing in India, which was hardly serving the needs of 250 million children. For us, it was a societal mission to democratize the joy of reading, which was the main anchor of my childhood.We started publishing in multiple Indian languages, created new, local, appropriate content, found new ways of distribution, and encouraged many new writers, editors and translators. The real breakthrough we had was to open source our content under the Creative Commons license. Since we wanted more children to access good books, and we did not have to worry about profitability, this was a perfect way to really open up the space. Our books were online, they were free to download, to read, to print, even to sell. By the time I left Pratham Books in 2014, we had already reached millions of children.

But a good founder must know when to step down. My succession plan at Pratham Books has worked better than I dreamed of. The new team has take the open platform idea even further as Story Weaver. Now it is a global platform with content in up to 200 languages, reaching millions of children around the world . There are even 250 stories in Mandarin if you want to look them up.

Even while I was putting my time into my own institutions, I was very aware that I do not have all the ideas and all the solutions. That philanthropists must not fall into the trap of doing things inside their own fence.

So, From the beginning, I also have supported ideas, individuals and institutions that display integrity and commitment to some sectors in which I have a long term interest – education, the environment, the arts, justice, good governance, active citizenship, media and gender equity- especially working with young men and boys.

This has allowed me to build a portfolio in these sectors, supporting dozens of entities around the country. I have always tried to begin from a position of trust with these organizations. It is very import that donors do not become dictators, and that they do not burden organizations with undue requests on outcome reporting that take away too much time and resources from the primary agenda of the team. This attitude has really helped me find the most interesting and innovative people to work with. I am proud of the flourishing civil society sector in India, where a breed of young and new organizations is innovating rapidly to solve emerging societal problems.

In many of these institutions I have been the first funder, taking a bet on the social entrepreneur. Only rarely have they failed to deliver. Soon, they begin to attract other funding, and though it is so hard to stay on the path of social action, with so many challenges, most of these organizations are now dreaming of scaling up. I am willing to support them at this stage of scaling up as well, which requires investing in instruction building and core capacity, where it is unfortunately hard to find other funders.

Both Nandan and I invest heavily in supporting institutions committed to long term change at scale. Some are think tanks that will have policy impact, others are building professional capacity in critical areas such as urban design, climate action, higher education etc. Supporting societal institutions is critical in a country where both markets and the state cannot solve complex societal issues on their own or even together.

In fact, the underlying philosophy between all that I do in my work is that good civic institutions, moral leadership and social innovations are the foundation of a successful society. In the continuum of samaaj (society) bazaar (markets) and sarkaar (state ), my work is firmly in the samaaj (society) sector. I believe that active citizens of the samaaj can make sure that power is held to account, that the markets and the state can be held responsible for the larger public interest. Of course, samaaj needs good institutions of both state and market to work alongside with, and we have always tried to build partnerships across sectors.

This is what has led us to what we call Societal Platform Thinking, which we have deployed at an organization Nandan and I confounded four year ago, called Ekstep, to bring learning opportunities to 200 million children. It is the first time that I have worked directly with my husband, and I am happy to report that the marriage is still surviving despite us having very different approaches and experiences in philanthropy!

Through Ekstep we have built a technology infrastructure for learning, which has been adopted by the Indian government to create a National Teacher Platform called Diksha, on which tens of thousands of teachers and millions of children will be able to learn and share.

As I come to an end of my talk, let me share some principles of Societal Platform Thinking, which incorporate all the lessons Nandan and I and the teams have learnt over three decades of our work. It is a values framework that has evolved over time.

Societal Platform Thinking is a way of looking at complex societal challenges. Systems change can only be addressed if samaaj, bazaar and sarkaar, state society and markets are able to work together with reduced friction to collaborate and co-create

The team has developed some founding guidelines for such action.

1. For many participants to work together, we need a platform, connecting many nodes. This should be a UNIFIED BUT NOT UNIFORM structure, so that situational diversity can be harnessed for designing appropriate responses. Context matters , and local actors know best what solutions can be developed in their particular situation. The platform must allow for that local knowledge to be applied, to ENABLE DIVERSITY AT SCALE.
2. Every change begins with something who feels the need for the change. We call these leaders system builders. Those who can put our bold visions that excite everyone to participate. A system builder must invest to CO-CREATE A TECHNOLOGY BACKBONE FOR A SHARED INFRASTRUCTURE for all stakeholders. However, the mission should not be technology led. It must be technology enabled. The goal of the tech infrastructure is to engage people seamlessly as possible. This technology infrastructure must be developed as Open, accessible PUBLIC DIGITAL GOODS, so that samaaj bazaar and sarkaar can build on top of it.
3. In such a scenario, there is no point trying to create ONE solution, no matter how great or effective. It is better and more sustainable, to DISTRIBUTE THE ABILITY TO SOLVE.
4. If the ability to solve can be distributed, you can find ideas from anywhere, solution making becomes discoverable, and lessons can be quickly shared. IT ALSO HELPS RESTORE AGENCY TO PEOPLE TO INNOVATE. Then they become part of the solution instead of remaining part of the problem. And the whole system become flexible, and remains open to EVOLVABILITY, one step at a time.
5. Often, philanthropists and civic entrepreneurs try out small pilots and then try to replicate them. Often, pilots succeed and scale up fails. That’s why it is important to design for scale in the beginning, and realize that there is a difference between scaling up what works and figuring out WHAT WORKS AT SCALE. Some of the points above allow you to design for population level systems change.
Today, some of these frameworks are getting embedded in a few areas of global philanthropic collaborations, of which I mention just one- Co- Impact, in which about 10 international entities have invested, including Nandan and myself, to seriously scale up impact in various societal missions.

At the end of all that, and all those big words I used, however, I want to say just this.

We are all trying to make a better world. Nothing is more humbling in one’s life than when we come to the realization , which all of us come to very quickly in this journey, that social change is the hardest thing we have ever attempted. We have all been successful in our businesses or our professions – we can even pat ourselves on the backs for it.

But making lasting change for the good is incredibly difficult. It requires us to cultivate humility, patience, and hope every single day.

So more than ever, let us dedicate ourselves to connecting our pockets to our heads and especially our hearts. Let us deploy our philanthropy, to build on the human spirit while always seeking what magnifies and elevates our own spirit. Let us stay curious, connected and committed.

Whenever I feel a little low, I remember Lao Tzu, whom i quote again.

“What the caterpillar calls the end, the rest of the world calls a butterfly.”

Namaste and Thank you. Xie-Xie.

Water Solutions: Leveraging Impact Through Smart Philanthropy

Water Solutions: Leveraging Impact Through Smart Philanthropy

October 22, 2019 | Philanthropy

Organised by Rohini Nilekani Philanthropies and curated by Arghyam, ‘Water Solutions: Leveraging Impact Through Smart Philanthropy’ was a day-long ecosystem convening held in order to bring together like-minded philanthropists and practitioners to deep-dive into solutions and opportunities for action at scale in water. The event kept in mind a strong solutions focus; with information and interactions that forged a positive bias for action in supporting scalable pathways to the water crisis. It highlighted the work of innovative water solutions, working on the themes of Community and Technology, and Governance and Policy, through three distinct lenses of access, quantity and quality of water.

The following twelve water innovators and practitioners presented their organisation’s solutions at the event through a crisp showcase.

  1. Aga Khan Rural Support Programme India – Video | Presentation
  2. Bharat Rural Livelihoods Foundation – Video | Presentation
  3. Himalaya Seva Sangh – Video | Presentation
  4. Foundation for Ecological Security – Video | Presentation
  5. PRASARI – Video | Presentation
  6. Goonj – Video | Presentation
  7. Ashoka Trust for Research in Ecology and the Environment – Video | Presentation
  8. Professional Assistance for Development Action – Video | Presentation
  9. Watershed Support Services and Activities Network – Video | Presentation
  10. Drinkwell Systems – Video | Presentation
  11. People’s Science Institute – Video | Presentation
  12. Consortium for DEWATS Dissemination Society – Video | Presentation

A graphical representation of the presentations and the distilled learnings and key insights from them are below:

Arghyam’s presentation and video on “Re-Imagining Capacity Building at Scale”

Ahead of the event, Rohini Nilekani Philanthropies, Arghyam and Sattva curated a report that focuses on water solutions, and the role philanthropy can play in their acceleration. The report features solutions that focus on community empowerment, technology-enablement and effective governance, which are critical levers for achieving scale and sustainability in improved water access, safety and security. It also profiles 24 water innovators and practitioners and can be read here.

IDR has published a conversation with Himanshu Kulkarni and Uma Aslekar of Advanced Centre for Water Resources and Development (ACWADAM) where they discuss our poor understanding of groundwater, which impacts both policy and practice.

Get, Set, NGO: How non-profit sector is going through remarkable change in India

Get, Set, NGO: How non-profit sector is going through remarkable change in India

October 20, 2019 | Philanthropy

The nonprofit sector is undergoing a remarkable change in India, powered by technology, young professionals and committed funders.

“What’s exciting for India is the innovation that’s happening around young entrepreneurs, how they are leveraging technology and how they are building communities that take more ownership,” she says. Rohini Nilekani, founder-chairperson of water and sanitation foundation Arghyam, says she is seeing more young, urban professionals enter the social sector, with a different approach to problem solving. “These are young, highly educated professionals who are looking to create more engagement to collectively solve a problem,” she says, while cautioning that professionalism in the social sector needs to be accompanied by passion and vision.

“Twenty years ago, a more long-term view would be taken. Then, it became a big thing and civil society organisations were spending half their time reporting impact rather than effecting social change. I think the pendulum is now swinging back,” says Nilekani.

Full piece here.

WestBridge Capital and Rohini Nilekani Philanthropies in research centre tie-up

WestBridge Capital and Rohini Nilekani Philanthropies in research centre tie-up

October 1, 2019 | CSR

Private equity firm WestBridge Capital and Rohini Nilekani Philanthropies have jointly committed Rs 5.5 crore to set up two new centres at the Bengaluru-based research institution, Ashoka Trust for Research in Ecology and the Environment (ATREE).

The two will engage with policy leaders on issues such as climate change and look at using the research grant to offer sustainable business opportunities for local communities.

The Centre for Policy Design and Centre for Social and Environmental Innovation — to be set up at ATREE’s campus — will focus on research and formulation of sustainable and scalable policies to address socio-environmental problems. They are expected to tackle critical problems such as invasive species, climate management, and food systems.

“We need to do more research and also create an environment where the research leads to better policy making,” Rohini Nilekani, who is also a board member of ATREE, said. ATREE is among India’s few environmental organisations that do research over long periods to understand the impact of shifts in environment, which is valuable when faced with climate change, she said. Sandeep Singhal, MD of WestBridge Capital, said the growing conversation about climate change triggered the grant to promote environment related issues.

“The situation is like everyone’s house is on fire,” Singhal said. “(Influencing) policies take time, it requires investment”. ATREE, besides providing policy inputs to tackle environmental degradation, is also looking to provide sustainable income for local communities living near forests. It also has set up programmes to commercially exploit invading species such as Lantana in Biligiriranga hills in Karnataka.

“With biodiversity, water and climate change being our focus areas, we intend to look at issues from an interdisciplinary standpoint and to put the research to use to address real world problems. In fact, the Westbridge and Rohini’s initiative to fund the project has triggered interest among other funders too, with whom we are seeing potential participation in future,” Nitin Pandit, director of ATREE, said.


We The People | Corporate Social Responsibility: Should It Be Mandatory?

We The People | Corporate Social Responsibility: Should It Be Mandatory?

August 15, 2019 | Governance

India, has become the first country to make Corporate Social Responsibility (CSR) spending mandatory through a law. New amendments to the Companies Act have been approved by parliament to make make it impossible for companies to escape CSR. The government also plans to include a specific penal provision in the Companies Act in case of non-compliance with CSR which could include a three-year jail term for officials in companies that fail to spend funds in any given year. Will this make corporate India wake up to its wider social responsibility towards narrowing down widening inequality or is the CSR law another utopian ideal being hijacked by political interference?

The other panellists invited to We The People, to discuss this issue included Nitin Pai, Co-founder and Director of the Takshashila Institute, Harsh Mander, social activist and author, Gurcharan Das, author, commentator, former CEO of Procter & Gamble, Naina Lal Kidwai, former HSBC Chairperson, former President Federation of the Indian Chamber of Commerce and Industry, head of India Sanitation Coalition, Pushpa Sundar, Founder/Director of Sampradaan Indian Centre for Philanthropy, Madhuresh Kumar, national convener of the National Alliance of People’s Movement in India, and Ashwani Dubey, lawyer, political activist from the BJP.

This is an edited version of an episode of We The People, where Rohini Nilekani and others discuss the 2019 amendment to the Companies Act, and whether enforced CSR stipulations for companies will be effective in the philanthropy sector.

Capital Alone Cannot Solve the Problem

What we’re seeing with the amendment to the Companies Act, is how easy it is to lose public trust when something starts out as voluntary and then the government enforces it as a mandate. Imposing jail time for cases of non-compliance and forcing companies to give, seems counter-productive because it will only create more bureaucratic processes in a country already burdened by so many compliance issues. I do think that the government needs to examine how this law is being framed, and I hope that they will roll back some of these stipulations and find a way to encourage philanthropy without making it mandatory, per se. That the amendment allows corporates a three-year time frame to spend the money, is definitely an advantage and will allow companies to go further than just the annual, short-term kind of strategies. In this sector especially, to really create change, you need to invest not just money, but time, research, and readjustment of strategies.

Of course, we should all exercise our generosity muscle much more. But with any kind of government tax on the super-wealthy, the fear is that personal philanthropy will decrease. So when we’re talking about taxes on wealth, it needs to be framed in a way that spurs generosity in individuals as well as corporations. Governments working in isolation cannot solve all of society’s issues, so philanthropic capital is certainly necessary. However, forcing companies to do this when philanthropy is not their core competency involves a lot more than simply giving up 2% of their profit. It requires setting up departments and really doing the work of trying to implement change, which is not at all easy. So I think the government needs to rethink how to go about this.

The central issue with the CSR law is that it’s as if we’re trying to outsource governance, which is supposed to be the mandate of the state. The fact is that pouring in large amounts of money is not necessarily going to help, because we still don’t have the capacity on the ground to absorb all of it and put it to use effectively. Even in terms of giving during disasters, sending money for flood relief, for example, doesn’t mean the capital is necessarily being used efficiently. Investments need to happen not just in terms of capital, but in terms of building a pipeline for help to reach the people who really need it. We need to step up and create multi-year platforms, and build a lot of trust between the government, the society, and corporates, before we can start innovating solutions. Instead, laws like this criminalising non-compliance result in people trusting the government even less than before.

Gurcharan Das and Nitin Pai both bring up an important point, that each sector plays a certain role in our society. The bazaar or market requires companies to make products, create jobs, and pay taxes to the government, which should be used on education, health, infrastructure, disaster relief, etc. These are the ways that companies improve lives, and the government needs to be cognizant of that. In addition to philanthropic initiatives, the wealth gap needs to also be bridged through economic growth, and corporates play a critical role in national development. Of course, we must also give to causes and try to address social issues, however, that kind of philanthropy needs to be motivated by something greater than the fear of criminal charges. That’s not to undervalue the CSR work happening in this country right now. But what Das mentions does bear noting – we are one of only three countries in the world that has a CSR law. One of these was the UK, and they abandoned this because they realised that it simply wasn’t effective.

The Drawbacks of CSR

Naina Lal Kidwai makes an excellent point, that our current definition for what falls under CSR areas may be too narrow. As chair of the water mission at FICCI, she examined water stewardship, which does not get covered in CSR. However, water stewardship is a key issue for companies to keep in mind when setting up and running factories in India. They need to be using water efficiently, maintaining full compliance with the circular economy and its principles. Companies inadvertently impact the communities they are located in, and doing narrowly defined CSR work after the fact is not a good solution. Instead, we need to widen the responsibility of companies beyond doing CSR, to address the environmental and social impact they have on the areas around them.

Pushpa Sundar also mentions this problem, because the government has simply interpreted CSR as financial allocation. We’ve lost sight of the need for companies to exercise responsibility and good behaviour, and we’re seeing the results of this. For example, the textile industry uses approximately one lakh litre of water to produce just one denim item. Sundar argues that if companies were to treat, recycle, and replenish water sources, that would be a far more valuable contribution than the 2% of their profit. This is one of the inherent flaws in the Companies Act – that CSR is treated as an activity or box to check off, and not in conjunction with a duty towards good governance or good behaviour.

Instead, we’re seeing these funds being used for political purposes, given to programs and goals that the present government approves of. Statistics show that in 2017, the spending for the conservation of the National Heritage category of CSR jumped from 46 crores the year before to 155 crores. This was due to several PSUs giving their CSR money to the government’s Statue of Unity project, inaugurated and unveiled by the Prime Minister. Under the Animal Welfare category, other corporates are spending large amounts of money to fund Goshalas, while issues like child mortality, and eradicating hunger and poverty were ignored and underfunded. So this certainly poses a problem.

The initial hope for the CSR mandate was that it would enable companies to come at societal issues with creativity and innovation, and perhaps problem solve in a way that the government so far has been unable to, however the reality does not quite match up to that. In addition, the new amendment poses a question of accountability. If the funds are not spent within the term of three years, how many people in the company will be held accountable and who will have the power and privilege to get off without any penalty?

Thinking Creatively

The reality is that in many cases, there is a dichotomy between companies that are underpaying their workers, adversely affecting the environment, but then starting a CSR initiative or foundation and absolving themselves of their other responsibilities. But the solution isn’t just to offer money outside their fence, but rather address the problems inside their fence as well, in order to create more sustainable, equitable businesses. However, I’m doubtful that the current CSR law will encourage this. Perhaps we need to look at other models to encourage philanthropy from the corporate sector, like asking companies to align more closely towards SDG commitments that exists internationally, so they can step up and align their businesses better.

The issue with the CSR law is that it is essentially imposing a tax, so I wouldn’t be surprised if companies say, “Why don’t I just give it to the Prime Minister’s relief fund,” to easily tick that box, rather than go through the effort of trying to innovate across societal problems. There’s a lot of work to be done in reframing how we think about accountability and our motives for philanthropy. In order to build up the capacity of social sector organisations to receive large amounts of capital and spend it well, companies need to trust our civil sector entities more.

One thought I had was that if we’re mandating that companies give this 2% SES, why don’t we allow them five years to use it to clean up their act inside the fence. That means improving the way they treat labour, improving their management of natural resources, improving the way they deal with what affluence they put out in the supply chain. It’s as good as saying “Use that 2%, otherwise government will tax it.” This kind of time frame would also help companies comply with SDG goals, etc.
Rather than trying to criminalise people for non-compliance, we can view this as an opportunity for creativity. As the other panellists have pointed out, it’s very difficult to hold the real culprits accountable, and placing that much power in the hand of the state is not what makes for successful societies, nor flourishing businesses either. There are other ways of achieving what we would like to achieve, where companies are serving the communities around them and are socially and environmentally responsible, without taking away from their profitability. So rather than the stringent CSR law currently in place, we can think of a more effective, creative solution that would be beneficial to the markets, the state, as well as society as a whole.

Closing Keynote | Strategic Non-Profit Management India | 2019

Closing Keynote | Strategic Non-Profit Management India | 2019

July 26, 2019 | Philanthropy

This is an edited version of Rohini Nilekani’s closing keynote address delivered to the 2019 class of the Strategic Non-Profit Management – India offered developed in conjunction with the HBS Social Enterprise Initiative and offered in association with the Centre for Social Impact and Philanthropyat Ashoka University.

People often refer to the social sector as the third sector, but I would argue that it actually has to be the first sector. In the continuum of samaaj (society), bazaar (the marketplace), and sarkaar (the state), the samaaj must come first. Bazaar and sarkaar were created to serve the samaaj. The samaaj includes all of us, and it has simply created the bazaar to serve its economic interests and the sarkaar to serve equality to all people, on a large scale.

However, over the centuries, the other two sectors – the state and the market – have acquired tremendous power. Technological advancement has enabled the accumulation of that power in ways completely unimaginable even a few years ago. It’s crucial that we understand the implications of the accumulation of power by the state and markets. In our hearts, we are citizens first, before consumers or subjects of the state. So we need social organisations that protect the wellbeing of the samaaj, and hold the bazaar and sarkaar accountable.

Balancing the Scales

Both the bazaar and the sarkaar have become extremely successful at driving scale, especially over the last few years. The market will always chase profits, acquire more customers, and accumulate power. Similarly, when the state achieves scale, it’s accumulating a lot of power for its continuing legitimacy. Both these forms of accumulation of power can create tremendous public good. Markets improve our lives in amazing ways every single day. The state enables the distribution of public services in a way that a sole individual could not possibly achieve.

What we really need in the social sector, is a mechanism of checks and balances, to hold these powers accountable to society. Today, civil society has an especially critical role in ensuring that the state increases equity, along with efficiency, and that markets are responsible while increasing profitability. Both the state and the market have also recognized that they cannot achieve success on their own, without the cooperation of the samaaj. Human problems are so interconnected today, that the state and the market are quite open to the intervention of civil society in many areas.

However, there are other threats as well. The three freedoms of democracy – the right to speak freely, the right to associate freely, and the right to practice one’s own beliefs, come with duties, which don’t get talked about enough. People must have the right to speak freely, but without deliberately hurting others; the right to form associations without turning into mobs; and the right to practice one’s beliefs, without preventing others from practicing theirs. So there are duties and rights, but these freedoms are increasingly being distorted.

It’s therefore important for all of us in the social sector to ensure we play a balancing role. While the state and the markets have been remarkably successful at achieving scale, whether the social sector can achieve that has always been a bit doubtful. Sometimes, I wonder if being unable to scale is a failure of imagination on our part. After all, Mahatma didn’t just try to improve the lives of people in the Porbandar District. He wasn’t just trying to improve the lot of all of the citizens of India. Rather, he was trying to transform humanity at its core. His imagination was that big and nothing would come in the way. The trade-off for our independence was not going to be sacrificing our humanity –that was the scale of his imagination.

Vinoba Bhave is another example that comes to mind. He was not trying to rescue land from just one district. He was talking about the redistribution of land, a very primary source of inequity in this country, across the nation. Jayaprakash Narayan’s Sampoorna Kranti was not only about one class or one identity group replacing the other. It was an imagination at a much loftier level. That’s how these stalwarts achieved scale, because of the scale of their imagination and their intent to affect change on that level. I wonder if the social sector now has lost a bit of that zeal for imagination. We all belong to the tribe of Gandhi, Vinoba, and Jayaprakash Narayan, and we need to look to the state and markets to understand how we can achieve scale in this sector as well.

The Need for Societal Platform Thinking

Clearly, the motivation for scale is different in the three sectors. In the social sector, our goal is to improve human dignity, to create better access to goods and services, to restore agency, to increase creativity, and much more. Essentially, it is to give Izzat, Insaaf, Imandari to people. So when our goal is different from the market or the state, it’s clear that we can’t think of scale in the same way that they do.

Over the last 30 years, Nandan and I have been working in very different fields. Nandan has been a successful entrepreneur with Infosys, managing to get some 1.3 billion people another kind of system, as well as doing philanthropic work. I have been working within the social sector, helping individual institutions and ideas spread and grow. Through our work, the goal was to create more public goods in the public sphere, but we’ve also failed a lot in this regard. This is because it’s far easier to make a profitable company or a successful state, than it is to create real, lasting social change. Many wealthy philanthropists I’ve met have expressed the same feeling. They start out assuming that if they can create a successful business, why not a great social sector organisation? But when they actually try it, they find just how hard it is to create scale in the social sector. So we have to understand why scale is very different in this sector.

Since 2015, Nandan and I have been working together on EkStep, with the goal that we will reach the 200 million children in this country with increased access to learning opportunities. We both have different but complementary approaches to achieving this, and through the years, we have developed something called Societal Platform Thinking. When we are trying to solve complex, interdependent societal problems, we have to be careful how we go about doing this. Our methods have to be based on certain morally undeniable principles and philosophies. We have arrived at five of these basic principles, to help us and others get started.

The first thing we’ve learned is that however great a certain solution might be, if our aim is to solve at the root cause level and scale, just pushing one solution down the pipeline will not work. We have to design to distribute the ability to solve. This means that you need to implicitly trust people, and trust in their ability to be part of the solution. It becomes a question of design, where people need to see clearly, and be trusted to get involved in coming up with solutions.
The other thing that we learnt over time is that resources like money, people, talent, etc. are hard to come by. So many things, in terms of public goods, are hard to come by when you’re trying to scale something. So we began to think through this, and we found that if you unpack complex social problems, you often find a core that is common. When you look at the common core, you realize that there are ways to make those scarce resources plentiful. Sometimes there is abundance under your nose, it just exists in different forms. For example, if we think about education, it’s very difficult to find professional, competent teachers. But if we look at the system, there are parents, and para-teachers in abundance. So now the question becomes how to involve them as part of the solution?

Most of the problems that we need to scale for are contextual. The solution that might work in one place, might not work 100 kilometres down the road. There is a lot of diversity in India, and therefore pushing just one cookie-cutter solution won’t work. So how do you design to scale up diversity? How will your solutions work for diversity at scale? For that, in your design, you have to create a unified but not uniform intervention, design, infrastructure, and framework. Unified because we all have to achieve the same goal. There’s no use having a completely disparate kind of structure. It has to be unified but not uniform, so that you can achieve this contextual diversity at scale, which is necessary in a country like ours.

To ensure this, you need a digital tech backbone to distribute the ability to solve because you need multi-directional feedback loops. You need data coming in, not just being delivered at one end, but moving around all the streams so that people can use the data. But while technology is needed, we have learnt that you have to be technology-enabled. If you’re technology-led, you tend to make a lot mistakes about outcome thinking, because technology-led solutions can give you false sense of success. You can just rack up the numbers, rack up some data points, but you may not actually get the social outcome that you want. That’s important to keep in mind, because people today can get carried away thinking that the technology is the solution.

These are the kind of building blocks we are using at EkStep to design, to reach those 200 million people. We’re working with the state, and civil society, and the markets, to move the needle to reach those kids. So in the social sector, when we are thinking of scale, we need this kind of societal platform thinking, these social innovation labs where we can generate ideas, and more importantly, we can fail and learn from them.

Taking Risks and Embracing Failure

We all fail, but what’s important is that we are not afraid of failure. I think a lot about Gandhi, and how one of the reasons he went to South Africa was because he had failed as a lawyer. That failure launched a transformational epoch for humanity. Clearly, it’s how we deal with that failure that matters. Social innovation labs allow for that, that pull and push of failing, getting up, failing again, and succeeding.

However, in this sector, it’s very hard for us to acknowledge failure. Philanthropists are very risk averse. Most philanthropists are very successful in business, and they’ve taken huge risk to get there. But often, when they move to the social sector, they forget how to take risks. Since they are now dealing with people’s lives and futures, and common public goods, they want every venture to succeed. Businesses are allowed to fail. In fact, failure in Silicon Valley is celebrated. But in the social sector, if you fail, you might adversely affect a thousand people’s lives because of your mistake. As social sector organisations, it’s very hard to tell your donors that you’ve failed, but still need more money from them as well.

However, it’s time that we create spaces and platforms where donors, foundations, and members of civil society organizations come together and destigmatise this notion of failure. The question should now become how we do deal with failure, so that we can keep innovating? When we think about scale, we need failure, because without failure, there’s no innovation, and without innovation, there’s no solution for scale. So fear of failure may also lead to fear of scaling, and I think we are stuck somewhere in that fear. We should strive for platforms where donors and civil society organizations can meet in a safe space to talk about these things.

Although we live in a digital age, civil society in India has a lot of catching up to do. Some of my civil society friends are downright techno-phobic, and they assume all technology is bad. This is a huge challenge for us as a country of people who are not digital natives, but need to advance a younger population who are. We cannot afford to stay the way we are, because the accumulation of power is also happening digitally. Unless we understand how to work efficiently in a digital age, and through digital means, we will not have the internal resources and external tool kits to hold the sarkaar and bazaar accountable. The Indian civil sector needs to come into the digital age, which means the donor community needs to support this as well.

At the heart of all this, the motivation for our work is to restore dignity and agency to people. Roosevelt once said, “Look to the stars, but keep your feet on the ground,” and I think that’s what we should keep in mind when we think about scaling our work, especially in the philanthropy sector.

How Samaaj Impacts the way in Which Sarkaar and Bazaar Work

How Samaaj Impacts the way in Which Sarkaar and Bazaar Work

July 22, 2019 | Governance

This is an edited version of a talk Rohini Nilekani gave at the offices of the eGovernments Foundation on how samaaj impacts the way in which sarkaar and bazaar work, and the role of samaaj in eGov’s mission.

The Continuum of Samaaj, Sarkaar, and Bazaar

Since the past 25 years, I’ve been deeply involved in the civil society sector of India, which is very thriving and diverse. Through reading extensively and talking to people, especially at the grassroots level, I have tried to create a certain philosophy for myself through which to view the world. This theory is fairly simple – that there is a continuum of samaaj, bazaar, and sarkaar. But we must understand that samaaj is the foundation on which this system is built. It is not the third sector, as some people call it, but the first sector. Bazaar and sarkaar were simply created to serve the samaaj. The markets and state evolved as responses to the needs of diverse societies, and over the centuries, bazaar and sarkaar have developed from simple management systems, in order to serve the evolving samaaj.

We are citizens first, not consumers or subjects of states and kingdoms. The bazaar and the sarkaar are therefore accountable to the larger needs of samaaj. This is the starting point of all my philanthropic work, and eGov is similarly a samaaj actor first, that is simply working with the sarkaar and the bazaar. As time progresses, this dynamic between samaaj, bazaar, and sarkaar will obviously keep evolving and shifting. But at the heart of it all lies power and power structures, with the potential to pull things out of balance.

Depending on how power structures play out, the fluidity, roles, responsibilities, and strength of these three sectors keep changing. In the last century, both bazaar and sarkaar have become very powerful and extremely oppressive in many parts of the world. With examples like Mao and Stalin, we have seen how the sarkaar can literally take over people’s lives, oppressing the samaaj they should be serving. Post-World War II, as reconstruction was taking place all over the world, capitalism began to advance and make substantial inroads, to the point of even dismantling the Soviet Empire. The markets began to gain an increasing amount of power, which we can see even today. Back then, they called it the military-industrial complex, but the fact is that the market had acquired a lot of power even on the consumer side, affecting the samaaj. Today we have seen how a group of transnational corporations, tech companies who represent the market, have pretty much decided how we should think and feel.

An Age of Extremes

The pendulum has swung too far on either side. In many cases during the last century, we have observed the market and the state colluding. When that happens, the samaaj must be happy with crumbs. The power of the state and market combined is really detrimental to the samaaj. Additionally, the samaaj is not one homogenous unit, and therefore not as united in their goals as the sarkaar or the bazaar. We’re living in an age of extremes, where the mobile phone revolution has seen individual liberties being stretched too far as well. Anybody can do anything they want from anywhere, at any time, which includes the ability to spew hate and encourage violence, without any accountability. So there are issues within the samaaj as well.

On the samaaj side as well, we have seen a response to this kind of accumulation of power, which strangely enough gave individual liberty one last run in these last 25 years. With access to a mobile phone and a computer, you can do absolutely anything, connect to anyone, anytime, anywhere, including all the negative fallout that we are seeing today. We are in the middle of a huge societal correction, where we will see new societal norms being formed around this notion of individual liberty, market power, and state authoritarianism in a digital age. It’s unclear where this will lead, but the corrections happening right now look like upheavals. Recent advances in technology make me fear the power of bazaar and the surveillance state.

While all of this is going on, there is a pushback as well. When power accumulates, there’s always a responsive force that tries to pull it back, and maintain a dynamic balance. A lot of interesting things are happening in the samaaj sector in response to this accumulation of power. We’re seeing the emergence of many civil society actors around the globe who are responding to this accumulation of power by the state and the market. And that is the interesting space in which I work.

Seeing Like a State

This brings me to the reason why this understanding is so crucial when thinking about organisations like eGov. I think eGov has been very successful, working on the supply side for urban areas, which was pretty non-existent before. The team did a fantastic job of gaining the trust of the state at all levels, and understanding the political economy in order to work with the state’s institutions, bureaucrats, and administrators to ensure more efficiency and accountability. But this was done from inside, behind the walls of the state. In James Scott’s book, ‘Seeing Like a State,’ he talks about how the state needs to look after equity, since the market is naturally interested in profit. The main responsibility for maintaining equity on behalf of the samaaj, falls to the state. However, while the state is mandated with the idea of equity, it often is more comfortable with efficiency. This is because efficiency is easy to measure, it is easy to design for, and it is a placeholder for equity. You feel like you’re moving somewhere good when you try to put efficient systems in place.

Scott argues that this is “seeing like a state,” i.e. wanting to organise citizens and issues in a way that is efficient and convenient to deal with. So the impetus is to create visibility for the state, rather than to serve its citizens. Scott describes many experiments, including Le Corbusier’s work, the collectivization of the farms in China, and similar land experiments in the Soviet Union, as examples of actions that were designed to create efficiency for the state, but did not always translate into public benefit. Even with the best of intentions, the way the state sees us is very different from how we would like the state to see us. So the original intention of eGov was to make the state more accountable to the public and to acts of public good. No matter what we achieve from the supply side, if we don’t hold this as a principal value of the work being done, we may end up with negative consequences.

For example, the Grievance Redressal mechanism, even if it’s designed efficiently, unless it actually works on the ground for citizens, it cannot be called a success. It may function beautifully from the state’s point of view, and it makes bureaucrats work more efficiently, since they can process 1,000 complaints at a time instead of just one. However, it may not serve the samaaj well enough or be as focussed on maintaining equity. This is why the lens of the samaaj is crucial for eGov. So now we need to identify the actors within the samaaj who can work with eGov to make sure that all the amazing groundwork they’ve been doing for 16 years gets translated into real public good. This might mean going back to the drawing board, to rethink the designs of some systems that are already in place. They need to be at the centre to figure out what are the challenges for them and how can we redesign to their benefit. While in terms of efficiency, standardizing systems is the most convenient thing to do, in reality these need to serve a diverse group of people. If we’re trying to look at societal platform thinking, where the goal is to address complex societal problems, one of the principles of this is to hold on to and cater to that diversity. This applies to the context of eGov as well. Diversity is at the heart of resilience, so if we want to respect and understand the importance of diversity, especially in a place like India, then we have to be willing to design for that diversity at scale.

Diversity At Scale

When we think of designing for diversity at scale, the challenge is figuring out how to standardize change. Cookie cutter standard mechanisms will kill diversity, but if you believe in diversity as a fundamental principle of good design, then you have to design for diversity at scale. Within the Grievance Redressal mechanism, for instance, the diversity of language has been taken care of, but there may be other contextual, cultural things which we might need to redesign for, to make it effective for both state and citizen.

This is what we’ve tried to do at Pratham Books, where we decided it was time an Indian publisher was able to distribute and democratize the joy of reading. We kept this principle of diversity at scale, to unlock the potential of ordinary people who created a whole reading movement for the children of this country. There are 250 million children in India, the total population of many other countries. So how do we unlock the potential of parents, teachers, writers, illustrators, translators, editors, and storytellers, in order to make a movement? We did this by creating a Creative Commons platform, which allowed everybody to participate, putting a book or a story in every child’s hand.
After I left, the team went on to create other things such as the platform called StoryWeaver, which allows anybody, anywhere in the world to write and publish a story, to translate somebody else’s story, and to illustrate somebody else’s story. Of course, the original has to be acknowledged. Tens of millions of children around the world have benefited by unleashing the imaginations of writers, artists, mothers, fathers, and teachers. But all of this comes from the philosophy that the samaaj must form the base, and the sarkaar and bazaar should not oppress them. Instead, they should unleash the potential of samaaj.

When we think about organisations like eGov, the time has come to shift to the samaaj side and look at eGov’s work from that lens. We need to strive to not see like a state, but like a citizen.