To: Clark Hansen, CEO, AMDP
From: Vishrut Bubna, Analyst
Due: 26th February, 2019
Subject: Social Enterprise Investment Proposal
Investment Thesis
In
2025, India is predicted to reach a population of close to 1.5 Billion people.
This demographic “tsunami” can either be a dividend or a disaster as (table
below) a considerable majority of this population (India 2 and 3) lack many of the
fundamental services that are taken for granted in the western worls. One of
these services that is essential to empowering and transforming a person’s life
is banking, and the access to banking services. Over the past five years, there
has been a considerable increase in the access in banking services due to
various public and private sector initiatives such as the “Jan Dhan Yojna”, the
development of the Aadhar and UPI systems, and the increased mobile phone and
internet penetration. These secular trends serve as tailwinds for companies in
this sector, particularly the microfinance companies and small finance banks that
serve this primarily unbanked majority of the population.
Investment Criteria
This
investment is subject to specific criteria’s: Triple Bottom Line, Corporate
Social Responsibility, Social Enterprise, and Carbon Footprint.
Triple Bottom Line
The
triple bottom line consists of the three Ps: profit, people and planet. It aims
to measure the financial, social and environmental performance of the
corporation over a period of time by ascertaining its “real” cost of doing
business. The real in this context refers to the fact that this method accounts
for the social and environmental responsibility of the company along with the
fiscal.
Corporate Social Responsibility
Corporate social responsibility (CSR) is a
business model that helps a company be socially accountable to itself, its
stakeholders, and the public. Companies are conscious of the kind of
impact they are having on all aspects of society including the economic,
social, and environmental aspects. CSR means, that in a company’s normal course
of operations it should enhance the aforementioned aspects rather than
contributing negatively to them.
Social Enterprise
A
social enterprise is an organization whose primary purpose consists of specific
social objectives. They seek to maximize profits while maximizing benefits to
society and the environment and tend to reinvest the profits to fund social
programs. They differ from CSR as companies involved in CSR do not have the
sole purpose of maximizing benefit to society, rather, they are “socially
conscious” profit making companies.
Carbon Footprint
Carbon
Footprint refers to the sum of all the direct and indirect emissions of Carbon
Dioxide, which are induced a set of activities (e.g. driving) in a given time
frame. The carbon footprint is measured in tonnes of carbon dioxide equivalent
(tCO2e). For instance, an individual can ascertain the carbon dioxide
emissions based on their fuel consumption and the CO2 emitted per unit for the
specific activity. These serve as great estimates for ascertaining the relative
emission of greenhouse gases for various individuals, activities, and
enterprises.
Hi Vish,
ReplyDeleteI know that it is only a draft, but in the first paragraph you should make clear in what we should invest in–at the moment that paragraph is not focused enough. You start mentioning the company in paragraph two, but I still don't know much about it.
In addition, you need to change the table in your proposal; it is not explained well, and it does not help your point. If you want to keep the table you have to properly explain it to your audience. For example, I have no idea what India 1, 2 and 3 means. It distracted me since I had to think about it.
You chose an interesting topic and I am sure that there is indeed a lot of potential in that industry.
-Patrick Franzinelli