livemint.com - One night at the shelter

One night at the shelter

Apart from warm blankets and protection from icy winds, a chance to watch TV all night is also one of the draws for people who end up at the night shelters in south Delhi

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livemint.com - Using wealth to transform destinies

Using wealth to transform destinies

Philanthropy in our country rarely goes beyond helping family members, donations to temples, ashrams and religious institutions, or sponsorship of sports and cultural events that receive prominent publicity in the media

Sonia Gandhi, Chairperson, United Progressive Alliance

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Climate consensus reached in Cancun (The National - News, 12 Dec 2010, Page 1)

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Climate consensus reached in Cancun
Vesela Todorova CANCUN, MexiCo //
The National - News
12 Dec 2010

Poor countries to get financial help Delegates from 194 countries back a $100 billion fund and endorse carbon capture – and promise to work out the details next year

In dramatic early morning talks yesterday, delegates from 194 governments agreed on wide-ranging measures to fight climate change – including an endorsement of carbon capture and storage ( CCS), and a US$ 100 billion fund for poorer states. Key questions on how nations should share responsibility to avoid disastrous changes to the climate remained unanswered, and the future of the Kyoto Protocol was murky. But the adoption of the package, dubbed the “Cancun Agreements”, represented real progress, experts said. Among the key points of the agreement:

Rich states should reduce emissions by 25 to 40 per cent from 1990 levels by 2020.

A fund of US$30 billion per year will be established immediately between 2010 and 2012 to help poor states combat the effects of global warming.

By 2020, a US$100bn fund will be established for the same purpose.

Most important for the UAE, the summit agreed to make CCS, a technology that captures emissions and buries them, eligible for funding under a United Nations clean technology scheme. Until now, the programme has focused on renewable energy, energy efficiency and limiting the emissions from landfills. The proposal was submitted by Qatar in November.

Besides the UAE, it enjoys the support of Saudi Arabia, Norway as well as coal-dependent states such as Australia.

For several hours, Bolivia blocked progress on the deal, though the vast majority of countries insisted it should go ahead.

“We wish to state for the record that there is no consensus for the approval of this decision,” said Pablo Soln, Bolivia’s lead climate negotiator. After several rounds of discussions, he reiterated: “ This decision in our view does not represent a step forward, it is a step backwards.”

His government, he said, did not want to commit to a deal that lacked details on exactly how developed countries would cut emissions. The negotiating text lacks clauses that stipulate penalties if targets are not achieved.

Bolivia also opposes a target of limiting warming to no more than two degrees Celsius. The emissions reductions proposed in the draft will not meet that modest goal, Mr Soln said.

Environmentalists said that although they agreed with Bolivia’s position, some sort of agreement was better than nothing at all.

“ It is a compromise deal. It is not a perfect deal,” said Sol Oyuela of the UK-based advocacy group Christian Aid.

However, still on the table is the future of the Kyoto Protocol. The current treaty on climate obliges 37 industrialised states to reduce their emissions by 10 per cent from 1990 levels. The first commitment period of those countries expires in 2012 and agreement on a second commitment period, a point particularly important for developing states, was not decided. The first commitment period of those countries expires in 2012 and agreement on a second commitment period, a point particularly important for developing states, was not decided.

In addition, no emission cuts by developing countries, or by the United States, which did not sign the Kyoto pact, were agreed upon in Cancun.

Instead, all parties will “work towards identifying a global goal for substantially reducing global emissions by 2050” and to consider it at the next round of climate talks in Durban, South Africa, in 2011. The Durban summit should consider “a time frame for global peaking of greenhouse gas emissions based on the best available scientific knowledge”.

The summit also saw the creation of the Green Climate Fund, which is to be worth US$100bn by 2020, though it was not established how the money would be raised. Tim Gore, of Oxfam International, said the fund “should ensure that lifesaving finance will be delivered to those who are most vulnerable to the effects of climate change”. “ Governments in Cancun have chosen hope over fear and put the world on a difficult but now possible-to-navigate path to a global deal to stop dangerous climate change,” added Wendel Trio, the climate policy director at Greenpeace International.

He said that the emissions pledges by developed countries are close to what scientists recommend, but that compliance needs to be more transparent. “More would have been accomplished in Cancun,” Greenpeace said, “if not for the negative influence of the United States, Russia and Japan.”

The latter two refused to continue obligations under the Kyoto Protocol, while the United States “came to Mexico with feeble commitments to reduce greenhouse gas emissions and, despite being the world’s highest historical emitter, watered down several important areas of agreement and put a successful outcome in doubt”, Greenpeace said.

Change

Managing the business of change

If you’re going to lead your company through a restructuring, first you need to take a cold, hard look at the business

Bransonspeak | Richard Branson

Live Mint http://www.livemint.com/2010/11/23214609/Managing-the-business-of-chang.html?h=D

Restructuring is a difficult process, right? It can be. Even if you’ve done everything right, sometimes you have to take your company in a new direction because circumstances and opportunities have changed. Companies aren’t future-proof—no company lasts forever.

It is well known that over the years, we have closed down or sold a number of the 400 or so Virgin companies we have created—our critics regularly point this out. But what’s wrong with that? Companies are tools, each designed to fulfil a particular purpose. If they are superseded or no longer needed, our group will sell them or shut them down. We try our level best not to lose any people or know-how, but we do not allow ourselves to get nostalgic about the underlying concepts of the companies themselves. When Virgin renews itself, the critics who tut-tut about all the leaves falling to the ground have failed to spot the tree.

If you’re going to lead your company through a restructuring, first you need to take a cold, hard look at the business. Are you really going to be able to empower your staff to do the job that needs to be done? It can be superhumanly difficult to change a company’s existing culture. This is also something you should consider if you’re leading a team that’s contemplating a business acquisition—so many of which end up being disasters because the executives involved fail to understand the real challenges of getting different types of employees to work together and share the same goals.

We found ourselves grappling with a challenging situation in February 2007, when we relaunched the combined company of NTL, Telewest and Virgin Mobile as Virgin Media, creating the largest Virgin company in the world, with 10 million customers and 13,000 employees across the UK.

Until then I’d always followed a “small is beautiful” business plan. In Virgin’s early days, whenever the head count at one of our companies topped a hundred employees, I would ask to see the deputy managing director, the deputy sales manager and the deputy marketing director.

I would say to them: “You are now the managing director, the sales manager and the marketing director of a new company.” Then we would split the company in two. And when the number of employees at either of those companies reached 100, I would ask to see the deputies and split the company again.

Virgin Media was neither small nor beautiful. The NTL part of our business, in particular, was in a very sorry state. We needed to make drastic changes in the area of customer service. For one thing, the people dealing with complaints didn’t seem interested in helping customers.

We found out why: It turned out that they were reading from scripts all day.

This brings me to my next bit of advice: Executives and managers overseeing any restructuring or merger should find ways to inspire all employees to think like entrepreneurs. Whatever you do, treat them like adults. A person’s own conscience is the hardest taskmaster of all, so the more responsibility you give people, the better they will perform.

So in Virgin Media’s case, the scripts went straight into the garbage. We told our call-centre employees to solve problems within one call if possible, and we reallocated resources to the front line to improve operations.

There was scepticism at first among former NTL staff. What would happen if one of our customer-service people overstepped the mark? What if they started offering customers too many perks? My response to that was: “Live and learn.”

I didn’t think anyone should be criticized for being overly generous when handling a disgruntled customer. If one or two of our people got themselves into a tangle, it just meant they’d do better next time. And Virgin Media is now one of the UK’s leading providers of cable TV, Internet and phone services.

The lesson I have learnt from this and other, even more difficult restructurings is: avoid taking on someone else’s legacy. If the people you’re responsible for no longer have the enthusiasm and determination needed to relaunch the company, you’d be better off finding a new team to launch your business. You may even need to start from scratch.

But what if you can’t move on? What if that’s not an option?

There is an alternative, one of the hardest tricks in the book: Restructure your company so that it’s very small, very specialized and very expensive. This is an innovation of the highest calibre. Take a large operation and find ways to scale it down, retarget it and remarket it, all the while adding value that justifies the hike in price. It’s very hard to do, not least because you’re in so much pain as you’re doing it.

Why try this route? If you’re able to pull off the small-and-specialized restructuring, your staff may be in charge of a smaller company, but each contributor will have more clout. They will be able to take pride in their successes, and learn quickly and well from their failures.

What’s more, you’ll be gathering people together in a way that will have them bouncing ideas off each other, befriending and taking care of each other, and eventually they will start coming to you with solutions and great ideas again.

Wouldn’t it be wonderful if the new company you create is full of motivated, caring, creative people? Think of what you could achieve.

BY NYT SYNDICATE

© 2010/RICHARD BRANSON

Richard Branson is the founder of the Virgin Group and companies such as Virgin Atlantic, Virgin America, Virgin Mobile and Virgin Active. He maintains a blog atwww.virgin.com/richard-branson/blog. You can follow him on Twitter attwitter.com/richardbranson.

Rural Clean Energy Market

http://www.vccircle.com/500/news/rural-clean-energy-market-growing-at-211b-annually-study

Rural Clean Energy Market Growing At $2.11B Annually: Study

| SHRIJA AGRAWAL

Macro thesis for investment: This market consists of 114 mn households spending $4.86 bn per year on energy.

If you are a venture capital investor scouting for your next big investment opportunity, it could well be clean energy solutions addressing the bottom of the pyramid (BoP) market.

Venture capital and private equity investors, who bet big on the market size matrix, may find the sheer spread of the Indian clean energy market at the BoP level an attractive option.

According to a study conducted by IFMR Research-Centre For Development Finance in alliance with World Resources Institute, the aggregate potential market for the clean energy sector is pegged at $2.11 billion per year including $2.04 billion for decentralized renewable energy services and $70.1 million for energy products (solar home systems, solar lanterns, and energy-efficient cook stoves).

India’s rural Base of the Pyramid (BoP) consists of 114 million households, which spend Rs 224 billion ($4.86 billion) per year on their energy needs, says a study conducted by the IFMR Research.

These households constitute a significant consumer market for the energy services and products required to provide daily necessities such as cooking and lighting. Despite their low income, these households constitute a significant market for the energy services and products required to provide daily necessities.

Using the most recent available expenditure data (2004/2005), the research report estimates that  India’s rural BoP consumers spent $4.86 billion per year on their energy needs.

The research report added that clean energy services and products may require an upfront investment three to ten times greater than that for conventional energy sources such as kerosene and firewood, which often are subsidized or free to India’s rural consumers.

In the clean energy value chain, decentralized renewable energy enterprises, or DREs as they are called, constitute over 95% of the total forecast, said the research report.

DREs supply rural BoP consumers with electricity services generated from renewable sources of energy (primarily small hydro and waste biomass) through existing grids or company-owned distribution systems.

Based on the most recent available data (2004/2005) for expenditure, the report estimated the potential market value of the DRE sector for India’s rural BoP segment at $2.04 bn per year.

Within the energy products, the market size for solar home systems (SHS) or solar-based electricity-generating and storage systems designed to provide power to individual households is estimated at $27.39 million per year. The business model that has typically been prevalent for solar home systems is that of being sold on credit, in partnership with local banks. Users typically pay 10 to 25 % upfront and the rest in installments.

The market for solar lanterns or portable LED lanterns that are powered by solar panels, that can provide light for four to eight hours, is worth $18.58 million per year and the market for energy efficient cook stoves is estimated at $24.13 million, says the report.

Solar Lanterns and efficient cook stoves are sold in bulk to corporate, NGO, and microfinance    institution (MFI) partners or sold directly to consumers through local retailers.

While there is a huge market with proven business model, it is also beset with its own challenges.  In the DRE space, particularly biomass or small hydro is highly dependent on regulation tariffs set by government and requires negotiation of power purchase agreement (PPA).

Apart from the regulatory challenges, there are other sales affiliated challenges. For instance, for selling solar lanters and cook stoves, government subsidies for kerosene dissuade consumers while charitable distribution schemes distort the local market.

The bottom of pyramid market is not new to the investment fraternity.  A host of funds like   Acumen, Ennovent Capital and Pierre Omidyar Network are looking at promoting entrepreneurs who advance disruptive innovations for sustainability at the base of the economic pyramid.   The investor interest in the space is only set to grow.

“Social investing is definitely witnessing a growing trend. Corporatisation of social projects is giving a new lease to this space,” Raj Kundra, Director of Capital Markets and Energy Portfolio, Acumen Fund, New York, recently told VCCircle in an interview.  Acumen Fund has been particularly active in the clean energy space at the BoP.

Some of the investments in clean energy targeting this market include D. Light (a series  of Solar LED lights with AC charging options which raised funding from Acumen Fund, DFJ, Nexus Capital and Garage Technology Ventures),  SBA Hydro & Renewable Energy (provides hydroelectric power to villages in the Himalayan Belt and raised $1.26 million from Acumen Fund), Husk Power Systems (a technology that converts rice husk into electricity raised monies from DFJ, IFC  and Acumen Fund).

MFI crisis

MFIs no better than money lenders, must be regulated: YV Reddy

MFIs are in the business of lending to poor who do not have access to bank funds and they source their funds from banks at a interest cost of 12-13%. They in turn lend lend at much higher cost of 36%

PTI

Live Mint

http://www.livemint.com/2010/11/22182015/MFIs-no-better-than-money-lend.html?h=B

Mumbai: Amid the crisis in the micro finance industry, former Reserve Bank governor Y V Reddy on Monday said the micro finance institutions (MFIs) should be regulated as they are no better than money lenders.
“Profit-seeking MFIs should be studied as they do not come under the laws relating to money lending or usury. After all, they are no better than money lenders,” Reddy told PTI a few hours before the launch of his second book in as many years since he left the Reserve Bank.
The comments from the former central banker, who is credited with shielding Indian economy from the global financial meltdown, comes at a time when the multi-crore rupees micro finance industry is reeling under a severe crisis.
The Andhra Pradesh government last month issued an Ordinance to control interest rates charged by MFIs and also to check the coercive recovery tactics adopted by these companies, which impacted adversely their collection and left them in a severe liquidity crisis.
Since the Ordinance has come into effect, the business of MFIs has come down with banks has slowed down exposure to the sector.
MFIs are in the business of lending to the poor who do not have access to bank funds and they source their funds from banks at a interest cost of 12-13%. They in turn lend lend at much higher cost of 36%.
The Reserve Bank is also setting up a panel to look into the entire gamut of MFI business.
“Micro finance is a respectable area, and the impressive profitability of our profit-seeking MFIs has attracted investments from private equity funds globally. There may therefore be merit in a detailed analysis in a sort of supervisory review, to check any incipient tendency towards irresponsible usurious lending by such profit-seeking MFIs,” Reddy said.
Reserve Bank governor Duvvuri Subbarao will launch the book titled ‘Global Crisis, Recession and Uneven Recovery´ this evening.
The book is collection of his speeches at various, but were not disseminated to the public, since his previous book entitled ‘India and the Global Financial Crisis: Managing Money and Finance,´ published in late 2009.

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