The founder of a former nonprofit micro-finance organization, SKS Microfinance, resigned today and has been replaced by a current independent director who will serve as "interim non-executive chairman" (apparently titles can matter) according to the Wall Street Journal.
While a founder's departure makes for interesting copy, this is not the only drama in the story. Equally if not more important is the issue that this current for-profit which earns revenue by lending to the poor, was actually once a nonprofit. Yes, this is the true meaning of blurring the lines between for-profit and nonprofit and so much so that consequences have included the development of legislation to set limits on how much interest can be earned when serving the poor.
Now let's check-in with the perceptual (what we see vs. what is) issues: did the founder resign or was he pushed out for having created heartaches for the company? And, is lending to the poor for profit ok? And, why didn't the board of the nonprofit anticipate there could be fall-out from converting to a for-profit? Definitely more questions than answers.
Comments