Winds of Peace Foundation

Steve Sheppard | February 2, 2012

While in Nicaragua last month, we made our way to visit a number of partners and prospects for funding, as usual.  A week’s worth of visits that includes sixteen visits within five departments of the country can make for a tiring itinerary, but there is always a boost of energy that comes from the people themselves.  Corporate CEO’s may receive perks from their jobs like access to private jets or luxurious vacation getaways under the guise of “business meetings.”  But MY perk is found in the faces and voices of rural Nicaraguans, peasants mostly, who are as basic as the earth they work on.  And every once in a while I meet one such person who can absolutely light up a room, his/her peers, and my own soul.  That’s what I experienced a few days ago.

Our final day found us in the northern department of Madriz, in the town of Somoto.  We made an early departure in order to take the long, slow drive to Venecia, a tiny wide-spot-in-the-road where the women of COMUNEC cooperative would be meeting.  The road is barely a road; four-wheel drive low is a blessing and a need, and we may have averaged 5-10 miles per hour for the hour to get there.  The region is as scenic as any spot on earth but for the occasional reminders along the way of how many of the rural poor must live, in marginal dwellings that barely qualify as sheds.  The way up the mountain is stunning: stunning in both its exquisite nature and its intense poverty.

The meeting to which we have been invited is essentially a one-year celebration of the formation of this group and Winds of Peace support of it.  The women arrive on foot, many having come from long distances.  One young woman has hiked for three hours down the mountain to where we have gathered.  Her neighbor has traveled even further, although with the luxury of a horse.  We meet inside the house of one of the members, a smiling, ebullient woman who is as fussy about her guests as any socialite ever was, even within the sparse darkness of her dwelling.  But the energy level is high; the chattering and laughter fills the room.  Shyly, every woman in the room offers a hand of welcome.

This scenario is not uncommon among the visits we make during my time in Nicaragua.   Certainly, groups are always eager to thank those who have provided resources of any kind.  And Nicaraguans in general have always shown themselves to be gracious and friendly in whatever the setting.  So the start of our visit with the women of COMUNEC was not singular by any means.  What it evolved to was something else.

The women began telling their stories of the past year, of how they sought to create an economic initiative of their own, of how their husbands were invited to deed one manzana (1.68 acres) of land to their wives, of how 34 actually did so, of how that transfer created access to funding for the cultivation and care of the land, and how the harvest was now fulfilling dreams.  These are moving stories of individuals who likely have never belonged to any organized group in their lives, who have lived lives of exclusion under the authority of their husbands, and who yearn for their own voices and standing in precisely the same way that women from western societies do.  And maybe for the first time in their lives, they are beginning to feel the empowerment of such achievements.

The stories are told quietly but with confidence, until one young woman stood to share her experience; it was the woman who had hiked for hours.  And her recitation immediately elevated both the impact of the meeting as well as the self-assurances of everyone else in the room.

Her name is Gladis del Socorro Herrera.  She articulated what was held in the hearts of the others in the room and injected an energy and passion that was tangible.  ”To say that I have my own plot of land, that’s a beautiful thing.  It is the first thing I have ever owned that is truly mine.  I can hardly believe that I was out there on this piece of land that was mine! ”  The excitement in her voice was tempered only by the slight quiver of emotion as she spoke it.  I had been attentive to the others prior to this, but Gladis spoke with a fervor that grabbed me entirely.

“This chance makes us owners of something, something that belongs to us, and an experience that we can share with one another, these sisters.  Sharing our excitement, our experiences, our training and our learning, is wonderful!  To have had our heads filled with knowledge, we are brand new people!”   I would never presume to say that I know what Gladis was really feeling, but I do know that her words sent chills up my spine and drew a tear from my eye, such was the power of her testimony.  Her unfiltered, uncensored joy over this simple plot of land- its importance in her life, and how it had even strengthened the relationship with her husband as they compared notes and counseled with one another about the harvest- spoke eloquently about its impact.  Her enthusiasm prompted others to speak with emotion, as well.

“I had never taken a loan before.  I was always frightened about such things.  But the trainings have removed my fears; I’m past that.  I understand how the loan works and it has changed me.”  These small loans from the coop were transformative in small but very personal ways.  I noted especially the reactions of several women in the room who had not yet joined the cooperative and who were as riveted by the stories as I was.  I thought that I perceived looks of hopefulness, if such can be identified.

The elements of life which give us hope, which satisfy our longings and fill us with happiness are likely far different from what we in “developed” countries identify as gratifying; I often find myself asking the question of who is really the more developed?  For one small group of Nicaraguan women, joy has come not from riches or technologies or accumulation of things, but from a plot of earth that they have as their own and the pleasures of sharing such a rare experience with others.

“If you’ve come to take something away from this visit, take our happiness in being able to work together; that is our wealth.”  I did come away with a clear sense of their happiness, and it’s a lesson that perhaps we would all do well to understand….

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Steve Sheppard | January 28, 2012

In light of the current status of banks and banking in the U.S. (wretched), I suppose the last institution with which I’d like to be affiliated is a bank.  Central banks and those deemed “too big to fail” contributed mightily to the near-collapse of the U.S. economy several years ago, and their persistent breaches of integrity place them firmly at the lowest end of the scale of trustworthiness.  It’s a bad place for banks to be, when they represent an institution that really should thrive on their customers’ trust.  (Just this week I was prompted to contact one well-known national bank to inquire about when they might be predisposed to distribute a small remainder of my parents’ estate, the bulk of which was settled months ago.  Oh yeah, they replied, we probably can release those funds now.  Hm.  Who knows how long they might have elected to hold onto the funds if I had not inquired.)

Last week, however, I had an entirely different experience with a banking operation in Nicaragua.  I visited again with The Nicaraguan Association for Sustainable Development (ANIDES) and its visionary leader, Gloria Elena Ordoñez Vargas.  This is an individual and an organization that understands what banking is supposed to be like, and it puts to shame most of the other organizations I know that go by the name “bank.”

Winds of Peace has funded ANIDES previously, in an effort to assist the organization with the establishment of five communal banks.  These are small, local banking offices to promote the economic and organizational autonomy of more than 200 women who live in extreme poverty in very rural locations.  Indeed, the offices more often than not are simply the homes of the local leaders.  But what these banks have been able to do, what they have represented for the women members is nothing short of remarkable.

With a very modest funding by Winds of Peace, in a little more than a year ANIDES has been able to establish a revolving credit fund for the 220+ members, establish two business groups to coordinate independent “home” businesses, provide training in the creation of a savings culture, nurture a positive capital growth in each of the small banks established, offer education and assistance to women victims of domestic violence, enhance the access to basic food needs and boost the local economies of the communities served.  This is banking in its most holistic form, integrating elements that are social, organizational, cultural, economic, human, spiritual and environmental in scope.  When was the last time your bank inquired about your social, human or spiritual needs?

What is even more remarkable about this initiative’s success is that it is being achieved with women members who have almost no previous economic experience or training.  Meeting with the women for the first time last September, I was struck by their shyness and humility, but also with their tenacity (many came from miles away on foot) and their outright success: only one of the small community banks was showing deficits by its neophyte members.  Members themselves were providing the tracking, the follow-up and the solidarity with one another to make sure that their borrowing was matched by their repayments.  In other words, the bank existed to facilitate both the needs and the strengths of its members, not to impose onerous conditions that would encourage failure.  What a novel concept for banking.  What an amazing impact on the lives of some very poor people.

The intended extension of this banking project is that the women, who now have softened some of their previous fears about borrowing money, might be encouraged to invest in the improvement of their rudimentary homes and living conditions, including the installation of ecological toilets.  This amenity- sounding so essential to so many of us- has been considered an absolute luxury by many rural residents.  With the presence of the communal banks to accompany them, such an amenity now seems within reach, and along with it rises the self-esteem of the women who can provide it.  The existence of a small bank can allow these women to take control of their lives in ways they previously could not.

What can a bank do?  Merely channel the empowerment of its members, provide access to credit and tools for investment, facilitate education to recognize and respond to gender oppression, encourage healthy habitat conditions, grow self-esteem, foster economic autonomy and teach people how to take more control of their own lives.  In a world where the future for many banking institutions seems to include implosion, we could learn a great many lessons from these communal banks in Nicaragua.  It might even beg the question, “Who really is the more developed….?”

 

 

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Tags: Banking, Credit, Poverty, Success

Steve Sheppard | May 12, 2011

In past entries here I’ve alluded to the development of research on rural cooperatives in Nicaragua and the effort to help small-scale producers to better reap the rewards of their work.  Winds of Peace has commissioned a study on cooperativism in Nicaragua so as to better understand the history and context of why the coops function as they do, and whether there are opportunities to strengthen them beyond basic funding.  The study has been undertaken by researchers Rene Mendoza and Edgar Fernandez, two well-respected, Nicaraguan practitioners of organizational and rural development.  The final draft of their work is revealing some important perspectives that have already been useful in Winds of Peace development of its programming and funding.  In particular, the study led to the development of two, three-day workshops that I have also recounted here in earlier entries.

The full content of the study is now available for reference by anyone with an interest in a new perspective on the cooperatives.  On the Winds of Peace site, look to the left side of the Home Page for Rural Development, and beneath that tab you will see the link to the study.  You will find that the opportunity for the rural producers, buyers, technical assistance personnel and even lenders is greater than what is currently being realized; with a little collaborative effort that circumstance can be significantly improved.  Take a look at what’s happening!

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Steve Sheppard | March 14, 2011

So now we hear of the attack on no less than Muhammad Yunus, creator of the microlending concept, founder of Grameen Bank in Bangladesh and the 2006 Nobel Peace Prize laureate.    Grameen is one of the most visible, successful and transformational microlending organizations in the world, and like most successful enterprises, its success has attracted the unwanted attentions of those who would have it for themselves.  In this case, Grameen has become the takeover target of the Bangladeshi government.  The current events have caused overwhelming public outrage in Bangladesh over the last week, as a Government takeover of the Bank would effectively result in the millions of borrower owners (and their families) of the Grameen Bank -who own 97% of the shares of the Bank- being disenfranchised.

If the Grameen bank were to lose its independence, then this unique model of microcredit would totally perish; indeed, the model is not only selfless (Grameen Bank is a nonprofit making organization), but it is also responsible (in the sense that all borrowers also place their savings in the bank), and of course democratic (as it is the borrowers who democratically elect 9 of the 12 members of the Board).

The main reason for the current attacks appears to be a blatant attempt to take control over a highly successful bank where the Government’s equity has dwindled to barely 3% (despite this, it still prevails on the Board because of the governance structure of the institution). This campaign could be also viewed as a deep rooted animosity. Speculations range from petty jealousy over Yunus’ Nobel Prize and his international fame to grievances against Yunus for his brief foray in Bangladeshi politics.

The Bangladesh Prime Minister, speaking in the Parliament, has famously accused the Nobel Peace Prize-winner of “bloodsucking the poor”. The trigger for the Prime Minister’s outburst was an unfounded report in a Norwegian TV channel broadcast on 30th November 2010 claiming that a misallocation of a Norwegian Government grant dating back to 1996.

This report was quickly refuted by the Government of Norway which declared on the official website of its Ministry of Foreign affairs “… there is no indication that Norwegian funds have been used for unintended purposes, or that Grameen Bank has engaged in corrupt practices or embezzled funds.”

One would have thought that the Norwegian declaration of a clean bill for Grameen Bank would have been the logical conclusion of a matter raised and addressed. The allegations appear even more surprising as Grameen Bank is audited annually by Bangladesh’s Central Bank as well as one of the “Big Four” accounting firms as the outside auditor.

And so the accusations flow.  There are other allegations against Dr. Yunus, all of which seem equally bogus upon review.  The reality is that Grameen Bank stands as a valuable asset and an icon of Bangladeshi success, both of which are highly needed by the Bangladeshi government these days.  If the work and reputation of Dr. Yunus is the price to be paid for an easy acquisition of money and status, then the government is unfortunately willing to pay it.

There have been few individuals who have left such a positive and imaginative legacy on the world as Dr. Muhammad Yunus.  It is both ironic and unjust that  one who has struggled so effectively to give opportunity and dignity to the impoverished of the world now stands on the threshold of betrayal, at the hands of those who can only understand the value of power and wealth for themselves.

There is a great deal more detailed information available at the Friends of Grameen website.    Visit there to learn about the fraud being perpetrated against some of the poorest and yet most successful people in the world.  Ultimately it is not Dr. Yunus who pays the price for this coup, but the borrowers and supporters of Grameen Bank….

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Steve Sheppard | February 21, 2011

In conjunction with my January visit to Nicaragua, I also accompanied a delegation from Augsburg College in Minneapolis, the parent organization for The Center for Global Education (CGE).   The delegation included Augsburg’s President, Paul Pribbenow, five members of the college’s Board of Regents (of which I am one), and a number of Augsburg faculty and staff members and spouses.  This occasion marked the first time that a Regents’ delegation had traveled to any of the CGE sites around the world and thus served as an important moment for that governing body.  After all, it’s more difficult to adequately consider strategic direction and investment for an organization like CGE without having any direct knowledge of its work, and the only way to really attain that is by going to where they are.  The visit proved to be invaluable to the Regents as an act of asset evaluation, of prudent stewardship.

The visit also proved to be a special one for the staff members of CGE, affording them the opportunity to demonstrate the transformative nature of their work as they carefully immerse delegates into the difficult realities of Nicaraguan life.  Their work is not to spoon-feed answers, but to cultivate questions for our own deliberation and conclusions.  Our collective reactions over the four days of traveling together suggest that the staff performed their work beautifully.  Within a week, the Regents convened at their winter meeting, in part to share their experiences and feelings about the journey.  Their reflections served as strong testimony to the personal impacts that such experiences often provide, and affirmed the importance of their first-hand observations on behalf of the Board:  in other words, good stewardship.

I remained in Nicaragua for another week after the Regents departed, visiting our current and prospective partners, trying to understand how and where Winds of Peace might make a difference, and even participating in a workshop on cooperatives which the Foundation sponsored.  It struck me that I was performing the same sort of work as the Regents: assessing the work being done and, in the process, being a good steward of the resources being employed.  I noted to myself the similarities of purpose between the two weeks, the first on behalf of Augsburg College and the second on behalf of WPF.  And it dawned on me that there is likely a third stewardship at play during any of the visits made to Nicaragua, the stewardship of hope.

Just as Augsburg Regents are the keepers of the CGE asset and WPF staff are the keepers of Foundation resources, anyone who has the chance to travel to a land like Nicaragua and discern the realities there is a keeper of something valuable: the notion that somewhere in the world there are people who care about what happens in such a place.  For Nicaraguans, knowing that someone else has witnessed the struggles of their lives is a comfort.  To those who daily face the uncertainty of how to survive an oftentimes friendless circumstance, the commodity of caring is priceless.  It is a gift to be given by those of us who can, a wealth which conscious stewardship calls us to share.  It is an accompaniment which transcends material aid, a development not of economy but of the spirit. 

I’m pleased that Augsburg Regents are looking after the “jewel” that is CGE.  I’m privileged to be watching out for the use of Foundation resources for sustainable impact.  But likely the more important work for each of us is being a good steward of optimism and good faith, which our neighbors in Nicaragua so desperately need….

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Steve Sheppard | May 15, 2010

I recently had the opportunity to review a soon-to-be-published research project undertaken by Grantmakers Without Borders (GWOB), a terrific association of funding organizations whose focus is beyond the borders of the United States.  The purpose of the research was to examine the impact of microlending within poor countries, and whether this highly-touted initiative has really brought about the kind of positive change which its proponents suggest.  The paper is a good and balanced piece, and should be required reading for any funding organization contemplating or already conducting microlending practices abroad.  Watch for it.

The research finds, perhaps not surprisingly, that microlending is not the perfect tool for eliminating global poverty, despite its many virtues and successes.  While it has developed a momentum and a transformational impact where implemented successfully, it has also on occasion created unprecedented indebtedness and divisions within communities and families.  Initially, I found myself perplexed at this second type of outcome, not having experienced that phenomenon in our own work.

It turns out that the celebrity status of microlending has captured the attention of not only those who seek to assist impoverished people, but also those who see it purely as a means of access to an untapped credit market.  In other words, for some lending groups, microloans are just another way for the coyotes, the sharks, to circle their prey.

Sam Daley-Harris, Director of the Microcredit Summit Campaign, captures the essence of these profiteers perfectly in a recent presentation.

“This should have been warning of what was to come when microfinance institutions began to run more like commercial banks and what that might do to the soul of microfinance….

“I am fortunate to have been one of the leading advocates for microfinance over the last 25 years. We have been so successful in our advocacy that the field is out of control and now the profit-maximizers, those who want to make big money from the poor are rushing in. This leads me from the poverty and purpose part of my talk to the pitfalls and redemption portion.

“What are the problems that have become pitfalls? There are profit maximizers who charge the poor 85% interest, 100% interest, or more. As Prof. Yunus says, we started microcredit to free people from the money-lenders, not to become the new money lenders.

“I now see that the spiritual dimension of microfinance, the redemptive dimension of microfinance is central to my vision for the field. The technical issues are important, but only if they serve the transformational dimension.”

The findings in the GWOB study shouldn’t be a surprise or perplexing at all.  The essence of the microlending idea is that it is a tool for helping poor people raise themselves from poverty.  It’s not designed as a tool for financial institutions to use in tapping a new market and making a lot of money.  That practice will inevitably create real problems for both the borrower and the lender.

It seems to me as though a good share of the research and conclusions (or at least doubts) about the effectiveness of microlending revolves around MFIs that are in the business of lending. These organizations are quite different from the microlending institutions that exist for the purpose of true development. In essence, it is difficult to effectively address the efficacy of microlending conceptually when both types of funders are considered together; a more effective assessment has to look at the two forms separately since they are so fundamentally different. I am not surprised to read about predatory practices on the part of “Financial-System” lenders, but would be surprised and disappointed to learn of such behaviors coming from a “Poverty-Lending” organization.

At the Microcredit Summit several years ago, I could feel the difference in both intention and tone when the people from Barclays Bank talked about entering the microlending arena “to serve a vast, untapped market.” Those words signaled the contamination that would occur within the microfinance community moving forward. It seems as though any good idea can and will eventually become abused in the name of profits….

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Tags: Grantmakers Without Borders, GWOB, Microcredit Summit Campaign, Sam Daley-Harris