When good intentions, charity, and investments are not enough
Lessons for private sector investors learned from troubled public efforts
Arguably, the $61B in US aid to reconstruct Iraq caused more damage to the social, economic, and political fabric of the country than the preceding US military invasion and overthrow of Saddam Hussein’s government. Arguably, after tens of billions of dollars of stability and nation-building efforts invested in Afghanistan, the country is no better than in 2001. Efforts in these two countries have demonstrated that good intentions, charity, and public social impact investments are not sufficient to catalyze and support sustainable positive social change in unstable and underdeveloped countries. Nonetheless, many of us learned essential questions that apply equally well to private social impact investments:
How can I measure the social risks and gains of my investment objectively?
- If I love a particular project, in which countries is it likely to succeed, or fail, or cause harm?
- For example, if I want to reduce gender-based violence against women in a given country, what kind of projects are likely to succeed, fail, or cause harm in that country at this moment in time?
At Sovereignty First, we have found three ideas useful to answering these questions, after years of building relationships and working in the field on the ground in Indonesia, Iraq, Jordan, and around Syria. Our team’s efforts to build tools for investors are based on these three ideas:
- To minimize risk and maximize positive impact, investors need simple-to-understand, objective measures of developmental readiness and capacity: “floors and ceilings” of capacity.
- Reliable information about a social impact investment requires ongoing, inclusive, and collectively objective assessments (think “Yelp” for politics).
- Every social impact investment will encounter on-the-ground challenges. Success requires a network of “foul-weather friends.”
INCA (Inclusive Nationalism Capacity Assessment): a comprehensive, developmental, simple assessment
The Shared Information Framework: a process to generate common understanding among influential organizations
INCA and the Shared Information Framework help with the all the problems listed above by solving the communication problem.
INCA and the Shared Information Framework offer a successfully field-tested approach to generate a comprehensive developmental understanding of a chosen country and provides a common shared vocabulary to describe and think about the country.
INCA and the Shared Information Framework enable broad engagement of key stakeholders and effective communication among local and international public and private sector organizations about the threats, risks, challenges and opportunities in a country, and the sovereign and adaptive capacities of the country.
INCA and the Shared Information Framework help prepare new markets for investment banks, help social impact investors to solve environmental and social challenges, and lower the risks and costs of doing business for ventures already at work within the country.
In a single image, INCA represents a picture of a country that is comprehensive and reveals threats to the country and the country’s capacity to adapt to those threats. Based on transparency and inclusiveness, the framework and INCA serve as a universal foundation for communication about any aspect of a country.