Dávila Álvaro
Organization: Fundación Social
Year Founded: 1911
Country: Colombia
Website: www.fundacion-social.com.co
Geographic Area of Impact: Colombia.
Model: Hybrid Non-Profit ,Social Business
Focus: Enterprise Development,Financial Inclusion,Homelessness & Housing.
Social Entrepreneur of the Year, Colombia, 2007 Video 2 (Spanish) The Innovation At a time when paternalistic, palliative approaches dominated efforts to work with the poor, José María Campoamor had an innovative vision. He maintained that any such efforts should use market-based approaches, and he set out to establish opportunities that linked the poor to the formal market system. His creation of Workers’ Circles and Savings Banks would evolve into what today is the Fundación Social which since its inception in 1911 has been based on two principles: workers as the primary actors of their own development, and to spur that development, the need to cultivate their “virtue to save”. Campoamor mobilized thousands of poor workers to set aside small amounts of money in their savings banks, agreeing to contribute the interest generated to education, nutrition, housing and other basic needs underpinning personal and collective progress. Contrary to a company that creates a foundation to channel its charitable activities, the Fundación Social is a non-profit “holding” that has set up 12 highly successful for-profit companies. These compete in the market and throughout their history have focused on 3 areas: banking, insurance and housing. The mission of the Fundación Social is to “contribute to overcome the structural causes of poverty in Colombia by building a more humane, prosperous and just society”. The way to accomplish its mission is by owning and managing profitable, poor-oriented business enterprises. Among other companies, the Fundación Social is the major shareholder in the BCSC bank, with its networks Banco Caja Social BCSC and Colmena (insurance); and Deco Construcciones (low income housing construction). The Fundación Social today is the 5th largest private financial group in the country with about 6% of the banking market. It has 5 million poor clients who benefit from its 320 offices in 56 Colombian cities. In the low-income sector, Banco Caja Social Colombiana (BCSC) is the largest provider in Colombia and Latin America, a leader in financial services and mortgages for low-income sectors. Background From its inception, the mission of the Fundación Social has been to address the root causes of poverty in Colombia. Today, over 60% of the country’s population lives below the poverty line. Income inequality is one of the highest in Latin America, while violence remains a chronic phenomenon exacerbating social conditions. From the moment José María Campoamor, a Jesuit priest of 36 years, arrived in Colombia from Spain, he was impressed with the vivacity and intelligence of Colombian children. They became the entry point for what would be developed with their parents, the “workers’ circles” and “savings banks” that later evolved into the Fundación Social. Campoamor’s initiative spread quickly thanks to his ability to mobilize a large contingent of women who, while not being religious, dedicated their lives to replicating “workers’ circles” together with “savings banks”. Demand for “workers’ circles” grew exponentially, based on the interest of municipalities throughout the country, but Campoamor insisted these would only be spearheaded if the workers were also ready to simultaneously open a Savings Bank. The circles focused on three areas: Educational opportunities (schools, newspapers, workshops, printing press, libraries, etc.); Economic opportunities (Savings banks, housing construction and loans, insurance, restaurants, grocery stores, etc); and cultural opportunities (popular celebrations, theatre, sport, etc.) Campoamor died in 1946 and the leadership eventually passed to lay hands – although it was never a Jesuit initiative. Alvaro Dávila became President of the Fundación Social in 1986. Strategy Fundación Social develops its activities through two main departments. One focuses on creating the conditions whereby civil society and business organizations in poor communities can emerge and thrive. Fundación Social provides hands-on accompaniment to very poor communities, providing skills building and leadership training as a first step, and subsequently connecting their enterprises to the formal economy. The second area of the organization is responsible for the functioning of its 12 businesses, creating others as needed. The organization seeks to be a market leader in financial services for the poor in Colombia as well as to significantly influence solutions to social problems, emphasizing housing, and microfinance. BSCS offers a range of financial services with an emphasis on savings, investment, and credit. The main obstacle BSCS has confronted in Colombia is the low use of banking services due to lack of trust in the banking sector. Thus, its biggest challenge is to expand the acceptability of its services to the poorest populations and businesses. To promote use of the banking system, BSCS has created a series of financial incentives for those who begin to save on a consistent basis, an incentive that has increased by 9% the number of clients in the last 2 years making use of this offering. One of the striking aspects of the Fundación Social is the priority it places on its work force - close to 7,500 people work with the organization and have been there on average for 7.6 years. In addition to offering a fair wage, the organization promotes the involvement of the workers in its management and provides personal development and capacity building opportunities as well as benefits in health, housing, savings, insurance and recreation. The Entrepreneur José María Campoamor conceived the underpinnings of what today is the Fundación Social. His genius lies in having sown the seed that for almost 100 years hence, has been able to grow and evolve into a continuously pioneering social enterprise. By 1943, Campoamor’s workers’ circles and savings banks had spread and been consolidated in the country’s major cities. While the venture was conceived by a visionary pragmatist, the adherence to its mission has never waived thanks to the contribution of other similar entrepreneurs, equally pragmatic and committed, who followed the priest’s footsteps and today lead the organization. Among them are Alvaro Dávila, who has been leading the organization for over 20 years within a complex political, social and economic climate that has characterized Colombia’s recent history, and Eduardo Villar, who would convince even the most loyal adherent to Milton Friedman about the virtues of a market that seeks the common good.
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