In 2004 I co-authored Driven By Wellth, a book about combining the drives for wealth and wellbeing to create healthier, more sustainable approaches to business success. To be frank, the book didn’t get much traction. Although I’d put my heart and soul into writing it, leaders were often reluctant to embrace the words.
But the world has dramatically changed since then. It’s been a profound joy for me to see the values of wellbeing rise to the forefront of leadership conversations and commercial success. Enlightened business models are being experimented with every day—from B-corporations to conscious capitalism to restorative leadership.
Few leaders are more passionate about improving global wellbeing through wealth than Patricia Foley Hinnen. As CEO of Capital Sisters International—and Encore.org’s recent winner of the Purpose Prize for social innovation—she is catalyzing a totally new approach for the economic empowerment of women. Here’s a bit of my conversation with her as part of Wisdom Works Face of Wellbeing Leadership blog series.
Me: I’m intrigued with how you’re using the door of wealth to advance wellbeing. How did you get started?
Patricia: I backed into it 15 years ago because of an alarming United Nations statistic: we’re missing 200 million females. That fact gets me out of bed every day. You would naturally expect our world to be fifty percent male and fifty percent female, right? Wrong. Census takers say that when it comes to females we’re 200 million shy.
Why? Because many cultures favor the male child over the female child; the female is often considered an economic burden to the family. And if she’s lucky enough to survive the infanticide, gender selection, and poor nutrition she’s up against, she still deals with being branded as property, often impregnated at a very young age and married off against her own will. It disturbs me that we devalue human beings.
Instead of letting this demoralize me, however, I’m taking advantage of an emerging reality: women are engines for growing economies around the world. I created Capital Sisters International to provide $100 micro business loans to impoverished women in developing countries who live on $2/day and lack access to traditional financial services. (Read more about the Capital Sisters story here.) When women are empowered with wealth, they lift up their families and communities. So I think putting wealth in the hands of women is a global game-changer.
Me: $100 is a tiny loan. So what affect does it really have?
Patricia: When a woman gets her first $100 microloan, she experiences a phenomenal transformation. By her second or third loan, she’s a powerhouse. We’ve photographed women coming into our facility, getting the first loan, and exiting the facility. I swear she looks like three different people. The first “she” is terrified, the second is embarrassed, and the third is walking tall.
Money is power everywhere in the world. Yet property, assets, and access to markets and finance are things that women haven’t broadly experienced. Why would the door be closed to finance and free markets just because you are born female? My mission is to level the playing field, and through Capital Sisters I’m achieving this mission through the door of wealth.
Me: How did you get started down this road?
Patricia: I worked for twenty years as a U.S. Congressional investigator assessing the effectiveness of our country’s international programs. I also worked with the State Department for many years before moving into my encore career in microfinance. But before all of that I served in the Peace Corps. There, I saw women in the middle of the starkest poverty who, for the sake of feeding their children, would borrow from predatory moneylenders. These young, sweet mothers were charged a disgraceful twenty percent interest a day. On one occasion, I saw a man in the marketplace literally terrorize a woman over paying a $4 loan. I realized then, at only 28 years old, the power of money.
For me this journey is about creating a healthier world through social justice more than charity, sympathy, or even empathy. I started my work-life as a young person who saw predatory moneylending; years later I found that it is still going on all over the world today—just for being born female.
So I’ve tried to cross-fertilize my experiences in government, the microfinance industry, and the Peace Corp to create a truly innovative approach, a virtuous moneylending cycle that benefits everyone involved. In this cycle, you borrow money from friends and colleagues who care about the world, loan it to women in need, get your loan paid back, and pay back your friends and colleagues. What’s not to love about that?
Me: It’s a powerful and generative model. But you say this isn’t charity. So tell me more about how it works.
Patricia: Instead of the traditional philanthropy model of providing charity to impoverished families, we sell $1,000 bonds regulated by U.S. securities laws so we can make business loans to the women of those families. We trademarked these zero interest investments Sister Bonds®; we love the double meaning of our bond name! One Sister Bond® finances ten women at one hundred dollars each; we make the micro loans through the nonprofit partners we’ve vetted in the field.
For receiving this micro loan, the women pay commercial interest rates, whatever it is in their country; frankly, what they pay is usually three to five times cheaper than the greedy moneylenders of their past. And, our loans do not require collateral. Our field partners also provide training to help women understand access to markets, share ideas about purchasing inventory and equipment, and discuss how to manage their money more effectively.
When our field partners pay the principal back to Capital Sisters, we repay our bondholders. The bondholders get to choose what to do with that repayment—to accept it or to pay it forward. Fortunately, 100% of our investors so far have reinvested!
Me: I imagine your investors really feel the meaningful impact of this approach.
Patricia: Yes, it’s exciting! For example, this morning a friend of mine signed a pledge for a $5,000 bond. This means she’s funding fifty women in her first year of investing with Capital Sisters. And she’s pledged this amount for five years. With that single pledge, her $5,000 has turned into $25,000 worth of micro loans. That amount will impact 250 women. We’ve already learned that helping one woman’s micro enterprise improves an average of five lives. So the investment in these women is truly a multiplier for wellbeing globally.
Me: How did you pick the amount of “$100” for the micro loans?
Patricia: It’s a sum that works everywhere in the developing world, whether Africa, Asia, or Latin America. $100 is a critical level of loan for the micro entrepreneurs we’re working with.
And on the investor side, our Sister Bond® is special because it is priced for the general public. You don’t have to be an accredited investor to buy it. It’s a grassroots solution to poverty. Everybody who watches the nightly news and feels discouraged—every household investor—can make a positive difference in the lives of others as well as get their money back. What we’ve created is a hybrid between philanthropy and capital investments. We’re using the capital markets for good through a non-profit lens for women. In essence, we’re turning donors into investors and investors into impact investors.
Me: So, $100 is an amount that makes sense for the investor and the micro entrepreneur. And it changes the world for each woman who receives it.
Patricia: Absolutely. Many of the women have been beaten down and are very frightened. They’ve never had a loan before.
But, as I mentioned, we see them change in amazing ways physically and emotionally on the same day they receive it. They walk into the mud floor schoolhouse (where we give out the loans) with a sense of, “What am I doing here?” And when they get the loan, they seem very shy and embarrassed. They’re in front of a larger group. They have to stand up and say their name. They talk about how many children they have and what they’re going to use the working capital for … sometimes they are so scared they can barely get the words out. Yet by the end of the meeting they walk out the door walking tall. It is as if they’ve absorbed a new level of power in their lives.
I believe that’s how we create a better planet. With this one intervention, a huge transformation can happen. These women are our world’s wellbeing leaders.
I was very touched by my interview with Patricia. So our team at Wisdom Works is delighted to commit 1% of the gross revenues from our Be Well Lead Well® programs, launched soon, directly to Capital Sisters for the economic empowerment of women and the advancement of wellbeing globally.
To learn more about Be Well Lead Well® or other transformational Wisdom Works programs and services for building wellbeing leadership, please contact me at email@example.com.
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