Small steps to sustainability January 12, 2015 0 Comments Share tweet Holly Moeller Columnist By: Holly Moeller | Columnist Spoiler alert: Instead of birthday gifts this year, most of my friends will be receiving Kiva cards. Kiva is one of many organizations working globally in microfinance. Such organizations take money from lenders (or donors, depending upon the repayment agreement) and put it into the hands of poor people in the form of small loans. (At Kiva, many of the loans are less than $1,000 US, and are made up of dozens of $25 loans from donors.) These loans provide individuals with short-term capital to jump financial hurdles and to start and grow their own businesses, empowering them to transition out of poverty. Unlike charities that freely provide goods and services, such microloans have garnered favor because they, in principle, can produce self-sustaining and permanent change in individual lives rather than short-term relief. Microfinance has been heralded as a way to improve financial security, alleviate poverty, elevate women’s social standing and improve health and education. Though microfinance is not without its critics or its need for improvement (or even replacement), it has revolutionized aid efforts and garnered its creator a Nobel Prize. If its economic and social potential wasn’t enough of a selling point, let me sweeten the pot: Microfinance can help the environment, too. I’ve written before about human population growth and overpopulation. One of the main sources of uncertainty in our global population predictions is Sub-Saharan Africa, a region where many microfinance institutions operate. Like the world’s developed countries before them, at some point nations in this region will undergo the latter stages of a demographic transition, in which birth rates fall as women have fewer children. The longer it takes to reach this point (that is, the longer birth rates remain high), the larger the world’s population will swell, and the further we’ll be from living sustainably on the planet. What if microfinance could accelerate the demographic transition? Many microfinance institutes focus on making loans to women: Properly administered, these loans should enable women to establish their societal value economically. (I like Kiva as a microlending introduction because it allows donors to direct loans to specific individuals.) When a woman can bring in an income outside of the home, her lost wages become an important part of a family’s decision to have children. As a result, birth rates tend to be lower. Birth rates also decline as women’s education increases, and microfinance loans should, in the long term, improve access to education by creating additional financial capital for families. Lower birth rates mean smaller populations, reducing demands on Earth’s natural resources and lowering carbon emissions. Of course, resource demands and carbon emissions also increase with economic status. Per capita, United States citizens emit far more carbon than Ugandans, for example. So microfinance also has the potential to accelerate environmental degradation. To address this, emerging microfinance initiatives are incorporating sustainability into their goals. For example, FINCA + and SELF are working to assist more than 1.5 billion people who live in energy poverty by financing home installation of clean energy sources like solar panels. These solutions can be more economical than building new or connecting to existing power grids, while simultaneously sowing the seeds of sustainable lifestyles. Beyond focusing on energy, some “green microfinance” groups screen borrowers’ businesses for environmental impacts. But perhaps most importantly, microfinance provides an avenue for people to transition from the day-to-day worries of feeding themselves and their families into lifestyles that provide at least a little breathing room to plan for the future. Over the years, it has become increasingly clear to me that “environmentalism” is a luxury. From a global perspective, I, and almost everyone reading this article, won the socioeconomic birth lottery. We are lucky to have the time to think about issues like overpopulation and climate change, and to have the financial resources to do something about it, which is ironic because the world’s poor — those least able to invest time and resources — will suffer the worst impacts. We are also, thanks to the studious industrialization efforts of Americans before us, far removed from the world’s most priceless ecosystems and most endangered species. We will never have to dynamite a coral reef or poach a rhino (or hunt the poachers) to provide for our families. So if microloans can provide a narrow door to a better life, a start to a transition to global equality, a glimpse of what it would be like to “afford” a conservation ethic, then I am all for them. And for those of you also looking for ways to marry ethical values with environmental ones, I’d urge you to consider them as well. Holly is always looking for earth-friendly philanthropic opportunities. Share your ideas at hollyvm ‘at’ stanford.edu, or in the comments section below. climate change global warming Kiva mircofinance overpopulation Seeing Green 2015-01-12 Holly Moeller January 12, 2015 0 Comments Share tweet Subscribe Click here to subscribe to our daily newsletter of top headlines.