Leadership Spotlight

How business is the best chance for solving the world’s problems

Rajan Kundra ignored it for a while. But eventually, that one nagging question — the one that had been bothering him for years — finally got to him.

It got to him even though Kundra had a pretty good thing going for himself up on Wall Street, where after a decade of hard work he had been named senior vice president at a major investment bank.

“But I was always facing the ‘What next?’ question,” says Kundra, WG’93. “It almost always permeated the way I thought about everything. Wall Street is an excellent training ground, and so a lot of people use Wall Street for that training and the skill building. But then they end up asking themselves, like I did, ‘What next?’ ”

Kundra, at least, didn’t have to look all that far for his answer.

Specifically, only about nine blocks.

That’s where he found the U.S. headquarters for the Acumen Fund, a social venture capital firm that has the stated goal of investing $100 million into promising young companies that can deliver results on two equally important fronts: profitability and social impact.

“We focus our investments on the macro level, with companies that we believe can deliver basic necessities to the poor,” says Kundra, who also previously worked as a Vice President at J.P. Morgan. “For the most part these companies we invest in are for-profit companies, focused on new business models and new market approaches.”

Acumen targets companies that serve the “base of the pyramid” — the very poorest of the world’s poor, more than 3 billion in number, who do not have access to even the most basic services. Acumen officials like Kundra, who serves as director of capital markets and energy portfolio, and fellow Wharton grad Omer Imtiazuddin, WG’03, who serves as health portfolio manager, believe their firm’s work can eventually touch the lives of 50 million people worldwide.

In short, they believe good businesses — profitable businesses — can do great things.

“I knew I didn’t want to go back to investment banking,” explains Imtiazuddin. “I grew up in Pakistan. I had always seen the poverty around me, and I think I always had a desire to make a difference in this world. I didn’t get that opportunity on Wall Street, given the hours and everything else. So having had that desire, I used Wharton as a sounding board to see if this was one of those things I really could make a career out of. I want my career to be something where I’d find great meaning beyond mere financial rewards.”

He’s not alone.

There is a real and quantifiable trend emerging in business today: An increasing awareness among business leaders of the enormous challenges facing the world — and, more importantly, a growing commitment among those same leaders to do something about them.

At the 2007 Wharton Economic Forum in Philadelphia, Rajat Gupta, former Senior Partner Worldwide, McKinsey & Company, said business must reinforce constructive contact and dialogue with society to “earn the right to serve. Corporate responsibility is not a luxury — we must work with partners to address problems facing society to shape social contract between business and society.”

At the 2008 World Economic Forum in Davos, Microsoft founder Bill Gates called it “creative capitalism” — “an approach where governments, businesses, and nonprofits work together to stretch the reach of market forces so that more people can make a profit, or gain recognition, doing work that eases the world’s inequities.”

And in a 2008 Financial Times essay, Wharton Dean Thomas Robertson asserted that pursuing positive global social impact is not just about doing “good,” but a logical business opportunity, not only for NGOs, but for multinational corporations. He wrote, “They transcend national borders and governments, have resources that may exceed those of governments, and may garner more confidence than governments. In addition to providing skills and resources, corporations can also implement social responsibility codes that help build a better environment in which to do business and that potentially can encourage economic development.”

In rising markets such as China and India, investment from Western corporations has been credited with everything from improving human rights and labor standards to creating an entire new middle class, while funds funneled through micro-finance organizations and firms like Acumen Fund are creating real results in improving health care, stimulating economic growth, and giving new hope to millions. Meanwhile, entrepreneurs and established companies alike are also seeking out new sources of energy, investing in promising new technologies, and implementing new programs and policies that will make sustainable use of natural resources.

Society as a Stakeholder

Profitability, Not Philanthropy

The Microfinance Revolution

A New Model of Social Entrepreneurship

Sustainability at the Bottom Line

The Business Opportunity in Social Good

Leadership for a Movement