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Consulting on Bangladeshi land-related services

23 August 2017

The article at a glance

A team of Cambridge MBA students worked with BRAC, the world’s largest NGO, on a plan to scale up land-related services for …

Category: Insight

A team of Cambridge MBA students worked with BRAC, the world’s largest NGO, on a plan to scale up land-related services for rural communities.

beautiful village with foggy mountain and green nature in bangladesh

Bangladesh is usually referred to as an “emerging” market or a “developing” economy, and these descriptions are certainly apt. But in the parlance of the World Bank and other global agencies, robust economic growth in the South Asian nation of 161 million people means that it’s now a “middle income” country.

Gross national income per capita in Bangladesh grew from $330 (in current US dollars) in 1995 to $1,190 in 2015, according to World Bank figures, with economic growth exceeding six per cent in recent years.

This economic transition raises important issues for BRAC (originally the Bangladesh Rural Advancement Committee), which has grown from a modest relief programme in 1972 into the world’s largest development agency, with a staff of 111,000 and annual expenditure of $1 billion. As countries grow richer, international aid is diverted to poorer countries – so BRAC has branched out into cost-recovery and surplus-generating “social businesses” ranging from clothing to dairy products in order to self-finance its programmes, which include health, education and sanitation.

A team of MBA students from Cambridge Judge Business School worked with BRAC this year on one such programme – the Property Rights Initiative (PRI) of the Human Rights and Legal Aid Services (HRLS) programme, that helps rural communities with issues related to land – and provided recommendations on ways to convert PRI into a social business.

“The core of our advice is that BRAC has a very historical and influential position in Bangladesh, and turning initiatives into social enterprises would provide a more sustainable funding model for the organisation,” says Diane Albouy, one of five Cambridge MBA students who worked with BRAC for their Global Consulting Project (GCP), a key part of the School’s MBA programme.

The idea: help BRAC’s the Human Rights and Legal Aid Services (HRLS) Programme build up a scalable social business in the area of land-related services that, in line with BRAC’s broader plans, is underpinned by a revenue-producing model with lasting potential.

“There are huge unmet needs in many parts of the world, and legal services are one of them,” says Jaideep Prabhu, Professor of Marketing and Jawaharlal Nehru Professor of Indian Business & Enterprise at Cambridge Judge, who has focused extensively on low-cost innovation in growing economies, and worked with the Cambridge MBA team. “Creating social enterprises is important, but it’s also essential that these kinds of enterprises scale up in a sustainable manner so they can meet these unmet needs.”

The five-person Cambridge MBA team’s month-long project, including two weeks spent in Bangladesh, worked with HRLS of BRAC. The five students on the GCP were Aurelia Kassatly, Diane Albouy, Lucia Palacios, Nicolas Moreno de Palma, and Juan Cacace.

“BRAC is the only organisation that we know of which was established as a not-for-profit, but has spun off several very successful for-profit enterprises,” Aurelia wrote in a recent blog post. “We can all think of a multitude of multinationals which have established corporate foundations or engaged in philanthropy, but you rarely see the opposite.”

HRLS runs 462 legal aid clinics in 61 districts of Bangladesh. HRLS works extensively with people in villages throughout Bangladesh, one of the world’s most densely populated countries in which one in five households has been involved in land disputes. Land-related cases make up 70 per cent of litigation in judicial disputes.

“Land is closely connected with our livelihoods, social norms, and economic activities,” BRAC says in a concept paper on creating new Integrated Land Services Offices (ILSOs) for providing reliable land-related services in rural Bangladesh. The Cambridge MBA team assisted in coming up with ideas as to what shape ILSOs can take, keeping in mind the vision and mission of HRLS and BRAC.

“The Constitution of Bangladesh grants the right to every citizen to acquire, possess, and transfer property,” the paper says. “The land sector is awash with numerous anomalies and corruption, however, including bribery, the usurpation of state and private properties through collusion of land officials, vested-interest groups, and influential people aligned with the power structure, the deprivation of landless people in the distribution of land, and the eviction of other marginalised citizens from their land.”

One idea suggested by the Cambridge MBA team in their GCP was a “cross-subsidy” system in which money generated from legal services for higher income people could deliver such assistance free to poorer people – and this is incorporated into the concept paper.

“The ILSOs will be revenue-generating and sustainable as they will operate under a financial strategy which ensures full charge for services for those in the higher income bracket, while still providing services for free or at a subsidised rate for those who need it the most,” the paper says.

BRAC historically tests new initiatives through small-scale pilot projects, and the organisation has now opened four ILSOs on a pilot basis following the model suggested by the Cambridge MBA team.

“The ILSOs will operate at the district and sub-district levels and will provide a wide range of services through trained personnel and Advocates,” the concept paper says. “Ideally, the offices will be located in areas readily accessible to people, eliminating one of the biggest obstacles to access to justice: distance.”

The paper acknowledges that challenges remain, including establishing connections with local government offices and obtaining support from the country’s Ministry of Land, as “land-related services cannot be provided in Bangladesh without the approval of the Government.”