12.9.12
Should the private sector have a role in Tikkun Olam?
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Should the private sector have a role in Tikkun Olam?

Is it appropriate for private companies to profit from helping disadvantaged individuals?

A few weeks ago, Reut and our partners the Alliance for Global Good hosted a conference on 21st Century Tikkun Olam as part of the GA in Baltimore. One of the panels focused on leveraging Israeli expertise to help improve the lives of individuals in the developing world. That panel highlighted the critical role that actors from every sector - not only those traditionally involved in development - need to play in order for us to positively impact a quarter of a billion people within a decade, as per the vision of 21st Century Tikkun Olam.

But is it appropriate for private companies to profit from helping disadvantaged individuals? This common question which came up in the panel highlights a supposed conflict between helping others and making money. In fact, there is no contradiction. One common misconception is that private businesses are profiting at the expense of disadvantaged individuals, but this need not be true. Businesses can profit by providing a needed service that helps the individual improve her/his own situation, say by providing drip irrigation equipment that significantly reduces the amount of water necessary to grow drops and leads to higher yields. In fact, most of the time a business is involved as a good or service provider, it increases the sustainability and scalability of the activity, as it becomes largely self-funding.

A second common question is to ask whether businesses should benefit from government funding if they are helping disadvantaged individuals. In every society there are some goods and services that the government needs to subsidize in order for them to be viable. One example of this is in our society is housing for the poor. The same might be true for certain goods and services that businesses provide to individuals in the developing world. The real beneficiary in these instances is the individual.

In fact, USAID recently announced that they were teaming up with NGO Devex to promote a service that would help provide information to the private sector and help connect them to international development opportunities. This kind of collaboration will ensure that the maximum number of people benefit. After all, that is our primary goal.