Archive for the ‘Muhammad Yunus’ Category

Statement of Prof. Yunus Regarding His Removal from Grameen Bank

May 7, 2011

Statement of Nobel Laureate Professor Muhammad Yunus on the Occasion of Supreme Court Verdict on May 5, 2011 Regarding His Removal from Grameen Bank.  Professor Yunus voiced his concern after revelations surfaced surrounding violence against employee leaders of the Bank.  Those interested may also want to read in the Bank’s point-by-point refutation of the allegations brought up in the government’s Review Committee report, as well as by the nation’s government-aligned media.

You have already heard the verdict from the Supreme Court.

Why did I appear before the Court? Why did I want to contest the order of Bangladesh Bank? Why there is so much concern about this issue at home and abroad? There may be some confusion regarding these questions. Please allow me to share my feelings with you to remove this confusion. I went to the Court for a specific reason. Bangladesh Bank sent a letter to Grameen Bank, removing me from my post as Managing Director of Grameen Bank. The letter also mentioned that I held this position for the last eleven years illegally. Bangladesh Bank did this without giving me a chance to explain my position. I felt that this letter was not legally correct, and through this letter, not only was I been wronged, but so was Grameen Bank. Nine elected members of the Board of Directors of Grameen Bank felt the same way. That is why the nine members of the Board and I filed separate writs in the High Court. We wanted these wrongs to be corrected. Therefore, we had to seek justice through all avenues offered in the Bangladeshi judicial system. This is what we have done.

The fate of 40 million poor people connected to this
In the event that the Honorable Court stated in their final decision that the letter from Bangladesh Bank was issued without lawful authority, I could continue my work with Grameen Bank and make the transition to a capable management as smoothly as possible. But, if the Court verdict went against us, the Board may be forced to take steps to implement the content of the Bangladesh Bank letter. This was the only reason for me to take this matter to the Court. I had no option but to seek justice in this matter.

It is indeed a much wider and much more significant issue to save the future of Grameen Bank and also to protect the hopes and dreams of the over 8 million borrowers. These borrowers are also the owners of 96.5% of the Bank’s shares. The Bank is connected with 40 million microcredit borrowers in Bangladesh, and its impact on all these people cannot be neglected. What happens to Grameen Bank influences the future of the millions of Bangladeshis who benefit from microcredit activities, as well as the future of the institution of microcredit itself. It is actually a great concern for me, and many others, that I properly fulfill my responsibility to safeguard their future before and after leaving the post of Managing Director of Grameen Bank.

Some have said that, instead of going to the court, it would have been more honorable for me to resign from my position as suggested by the Finance Minister. I do not think so. In that case, the end result would have been the same, so far as my exit is concerned. But I would have suffered from carrying the guilt of knowingly accepting an unexpected proposal and putting the borrowers and their families’ futures at risk. I could not do that.

Millions of borrowers like the ones seen meeting above could be adversely affected by a government takeover of Grameen Bank.

Millions of borrowers like the ones seen meeting above could be adversely affected by a government takeover of Grameen Bank.

Some people felt that I intend to cling to the position of Managing Director of Grameen Bank. But, the nation knows that this position is not my life’s goal. I was, and am, conscious of the fact that my future work will not be based on my holding on to this position, but rather, it would be working with the young generation, from other platforms to address the problem of poverty at home and abroad. I want to do that without jeopardizing the interests of Grameen Bank. This is the thought which prompted me to write the letter to the Honorable Finance Minister one year ago. I suggested two options to him for a transition that could take place without creating any waves within the Bank.  I did not get any response to these proposals.  I was, instead, told to quit. It is, therefore, unfair to me to suggest that I am holding on to the of position of managing director unjustly or to allege  that I am not co-operating in the process of transition.

For the last few months, a section of the media devoted itself fiercely to campaign against me, Grameen Bank, and the concept of microcredit. Everyone has his own explanation why this is happening.

An unfriendly atmosphere is not helpful for a smooth change of leadership
The cause of my concerns, as well as those of the nation and the world, lies here. These concerns are more for Grameen Bank and the future of its millions of borrowers, than for me. For this reason, I have been reminding you repeatedly that undertaking the transition process of Grameen Bank’s management in an unfriendly environment will only cause harm to the future of the Bank. I have always wanted to make sure that the transition takes place in a friendly, mutually supportive environment, so that the achievements of Grameen Bank may continue without interruption. There are many issues related to this. The big questions are: whether Grameen Bank can maintain its independent existence, and whether it can be successful in keeping itself away from political influences. What actually happens to financial institutions in our country if political influences start playing a role in these institutions is common knowledge. This experience will not inspire trust in the borrowers.  We all know how important the role of trust is in the operation of Grameen Bank.


Two Steps Backward for Innovation to End Poverty

May 5, 2011

A guest post from Sam Daley-Harris, Founder of the Microcredit Summit Campaign, which seeks to reach 175 million poorest families with micro-loans, and of RESULTS, which seeks to create the political will to end poverty.

The deed is done.  On May 5th, the appellate division of the Bangladesh Supreme Court agreed that the Bangladesh Bank, the nation’s central bank, was justified in firing Nobel Peace Prize Laureate Muhammad Yunus from his post as Managing Director of Grameen Bank, the institution he founded more than three decades ago.  Prof. Yunus’s lead lawyer, Dr. Kamal Hossain, one of Bangladesh’s most distinguished attorneys and a drafter of the nation’s constitution, was scarcely able to hide his disgust at the Appellate Division order, when he said, “I [apparently] have to take admission to university again to newly learn the constitutional laws of the 21st century.”

The dismissal is not the lone action of one government institution, but is part of a premeditated campaign that starts at the highest level, with Prime Minister Sheikh Hasina.  Their reason for sacking Prof. Yunus?  He’s “too old.”  Never mind that the 70-year-old Yunus maintains a rigorous schedule or that the Finance Minister, another key player in the sacking, is at 77 somehow not “too old” for that post.

The dismissal of Prof. Yunus from his post as Managing Director of Grameen Bank could portend ominous changes by the Bangladesh government.

The dismissal of Prof. Yunus from his post as Managing Director of Grameen Bank could portend ominous changes by the Bangladesh government.

Their excuse would be laughable if it were not for the calamitous impact it portends.  What makes the decision to remove Prof. Yunus so disgraceful is not that he would be out of a job – any university in the world would welcome him with open arms as a visiting professor.  No, the atrocity here is the fact that the independence and integrity of one of the world’s premier poverty-fighting institutions is now at grave risk.  Grameen Bank, an extraordinary institution with more than 8 million microcredit borrowers that took 35 years to build, could be destroyed in a matter of months by incompetent government action.

The government’s action cannot honestly be in response to accusations by a Danish documentary maker about an improper transfer of Norwegian aid funds more than a dozen years ago, because both the Norwegian government and Bangladesh’s own review committee have found that Grameen Bank did nothing wrong.  It cannot be due to the documentary maker’s charge of excessive interest rates, because Microfinance Transparency and the government’s own review committee found that Grameen Bank has the lowest interest rates in the country.  Instead, most observers see this as an inexcusable political vendetta by the Prime Minister against Prof. Yunus, stemming from his short-lived attempt to start a political party in 2007.

Consider these groundbreaking innovations that Prof. Yunus’ poverty-fighting laboratory has brought to the world, and what could be lost in the future from his unwarranted ouster:

  • In 1976 he made loans of less than US$1 each to 42 desperately poor Bangladeshis to start or build tiny businesses – and the microcredit revolution was born.  It has made its way all around the world.  While others have seen microfinance as a way to make big money for investors, Prof. Yunus has never once diverted from his original intent to empower the poor.
  • In 1997 Grameen Phone Ladies started bringing cell phone technology to remote villagers throughout Bangladesh – providing the dual benefit of creating jobs and increasing communications, which enhanced others’ work.
  • Grameen Shakti, an energy firm, has installed more than a half-million solar home systems and sold more than a quarter-million improved cooking stoves.
  • In a joint venture with Danone, the yogurt maker headquartered in France, Grameen Danone is bringing low-cost fortified yogurt to malnourished children throughout the country – and creating a business opportunity for the poor women who sell it.
  • College scholarships and loans have gone to 180,000 students. Most remarkably, in almost all of the cases, these are the children of illiterate parents who have had the help of Grameen Bank in breaking the bonds of inter-generational illiteracy.

A government that so rashly and ruthlessly ousts this innovative and transformational leader cannot likely be trusted to continue his revolutionary work.

But the deed is done.  Here is a sample of the visionary voice that Bangladesh has likely lost in this despicable government act.  Reflecting on the 1997 Microcredit Summit, Prof. Yunus wrote: “In teaching economics I learned about money, and now as head of a bank I lend money.  The success of our venture lies in how many crumpled bank bills our once starving members now have in their hands. But the microcredit movement, which is built around, and for, and with money, ironically, is at its heart, at its deepest root not about money at all.  It is about helping each person to achieve his or her fullest potential.  It is not about cash capital, it is about human capital.  Money is merely a tool that unlocks human dreams and helps even the poorest and most unfortunate people on this planet achieve dignity, respect, and meaning in their lives.”

An Update on Grameen Bank

April 29, 2011

Alex Counts is president, CEO and founder of Grameen Foundation, and author of several books, including Small Loans, Big Dreams: How Nobel Prize Winner Muhammad Yunus and Microfinance are Changing the World.

The ongoing saga of the confrontation between the Bangladesh government and its allies in the local media on the one hand, and Professor Yunus, the Grameen Bank and its 8.3 million borrower-owners on the other, has taken some surprising turns in the last 10 days.  On April 20, representatives of Grameen Bank’s employee association held a well-attended press conference, covered by The Daily Star and other print and electronic media, where they presented the signatures of 20,103 colleagues who urged the government to either allow Prof. Yunus to remain as Managing Director or, failing that, to appoint him as Chairman of the Bank’s Board of Directors.  This follows a similar effort by the borrower-owners of Grameen Bank, 3.7 million of whom signed hastily circulated petitions several weeks ago demanding that Prof. Yunus be allowed to remain as the bank’s chief executive.

Professor Muhammad Yunus listens to some of Grameen Bank's borrower-owners at a local Center meeting.

Professor Muhammad Yunus listens to some of Grameen Bank's borrower-owners at a local Center meeting.

More recently, the so-called “Review Committee” appointed by the government to probe into the affairs of Grameen Bank and its sister organizations submitted its report – spanning more than 100 pages, according to some sources – to the Minister of Finance.  While the report has not been officially released, portions of it have been leaked to government-aligned media outlets.

Soon after receiving the report, the Finance Minister commented on it to the press.  His two principal messages, as covered by the AFP wire service, were that there was no improper diversion of Norwegian aid funds in the 1990s, as had been reported in the media, and that Grameen not only did not charge “excessive” interest rates, but that it in fact charges the lowest rate of interest among microfinance organizations in the country.

Neither of these “findings” were surprising to anyone who has been following this story closely and without bias, but it was noteworthy nonetheless that a government-sponsored commission publicly affirmed these facts.  However, this did not stop hostile elements in the Bangladeshi media from seizing on the submission of the report to make new unfounded allegations against Professor Yunus. This has prompted Grameen Bank to issue a detailed “Response to the Various Issues Raised in the Review Committee Report as Reported in the Press“.

With the government-appointed committee finding that two often-repeated criticisms of Grameen Bank had no merit, hopes are rising that around the time of an upcoming Supreme Court ruling (expected May 5), Bangladesh’s judiciary or perhaps the leadership of the ruling party will put forward some kind of plan that will respond to the desires of Grameen Bank’s employees, clients and nine elected Board members to ensure the continued involvement of Prof. Yunus.  That would be welcome news and enable everyone to briefly celebrate and then get back to the work at hand – reducing the grinding poverty that remains the daily reality for millions of families in Bangladesh and around the world.

Those interested in this issue might also want to listen to a special donor update that Alex conducted by conference call on March 23, 2011. In it, you’ll hear a brief summary by Alex of the situation, as well as an enlightening question-and-answer session where Alex gives his views on the causes of the government’s actions, possible scenarios going forward, what this means for the microfinance sector as a whole, and how changes at Grameen Bank could affect Grameen Foundation.

Will the Government of Bangladesh Ruin Grameen Bank?

April 20, 2011

Barbara Weber, who worked at Grameen Foundation from 2002 to 2006, was a Rotary International Ambassadorial Scholar in Bangladesh and is now working on her Ph.D. in depth psychology.

Bangladesh went from being dubbed the world’s basket case in 1973 by former U.S. Secretary of State Henry Kissinger to becoming a beacon of development innovation that the rest of the world has since sought to emulate, thanks in large measure to its pioneering in microfinance. This renown is fast turning to infamy, however, as political vendetta cannibalizes the very source of the nation’s well-deserved pride.

The country’s acclaim reached a crescendo in 2006, when the Nobel Peace Prize was awarded to Grameen Bank and its founder, Professor Muhammad Yunus, for creating a system that has enabled the poor to pull themselves up by their boot straps. It has done this so effectively that its microfinance model has been studied exhaustively and replicated around the world.

What ensued next seems to have won Yunus the ire of the current prime minister, Sheikh Hasina. In 2007, the newly ordained Nobel laureate made a fleeting and ill-fated foray into politics in a vacuum that was created when a military-backed interim government began jailing operatives of the country’s top political parties. Sheikh Hasina herself was temporarily in exile and charged with masterminding crime.

Prof. Yunus and most of the Board directors who represent the borrower-owners of Grameen Bank tour the streets of Oslo the day before receiving the Nobel Peace Prize in 2006.

Prof. Yunus and most of the Board directors who represent the borrower-owners of Grameen Bank tour the streets of Oslo the day before receiving the Nobel Peace Prize in 2006.

Some saw this as a potential turning point for a country that had topped Transparency International’s list of the most corrupt governments in the world. Bangladesh was number-one on that list for five consecutive years. But when national elections were held in 2008, Sheikh Hasina – who had held the post of prime minister from 1996 to 2001 – again took office. Now, she and her party in power seem intent on systematically dismantling Grameen Bank.

In apparent collusion with the current government, the country’s highest court recently upheld the ouster of Grameen Bank’s founder as managing director. The Supreme Court will have one more opportunity to review the case in a ruling that is due on May 2. In the meantime, Prof. Yunus remains managing director of the Bank while the world watches attentively and awaits Bangladesh’s next move.


How You Can Help Support Prof. Yunus

March 23, 2011

Todd Bernhardt is Director of Marketing and Communications for Grameen Foundation.

As readers of this blog may know, several weeks ago the Bank of Bangladesh (BoB) informed microfinance pioneer Professor Muhammad Yunus, winner of the 2006 Nobel Peace Prize, that he was dismissed from his post as Managing Director of Grameen Bank, which he founded in 1983. It claimed that he was serving illegally in his position because it had never formally approved his appointment when the 12-person Grameen Bank Board of Directors – which has three government-appointed directors on it, including the chairman – voted unanimously in 1999 to exempt Prof. Yunus from the mandatory retirement age of 60.

In fact, the BoB had asked the Grameen Bank Board in 1999 for an explanation of Prof. Yunus’s appointment. The GB Board promptly replied, and the subject was never brought up by the Bangladesh Bank again – including during its annual audits of Grameen Bank in the ensuing years. Why then, has it only now brought up the age of Prof. Yunus as an issue, after more than 11 years of silence about it?

The answer is becoming increasingly clear. The government’s latest moves are not just about Prof. Yunus and his age. Yes, he’s been a victim of partisan politics, in which the players involved seem to be trying to destroy his reputation because they see him as a political rival, but there are also signs that the ruling party is trying to gain control of Grameen Bank to use it as a tool to attain their political goals. Grameen Foundation and others strongly believe that an attack against the independence of Grameen Bank has far-reaching, negative implications for microfinance around the world.

Prof. Muhammad Yunus has devoted his life to fighting poverty and empowering women in his native Bangladesh. The current government has repaid him by unfairly dismissing him from his post, an effort he and Grameen Bank are fighting in the courts. Will you help us defend his reputation?

Prof. Muhammad Yunus has devoted his life to fighting poverty and empowering women in his native Bangladesh. The current government has repaid him by unfairly dismissing him from his post, an effort he and Grameen Bank are fighting in the courts. Will you help us defend his reputation?

The government actions have prompted considerable outrage inside and outside of Bangladesh. Diplomats, politicians, leaders of international-aid agencies, and business and thought leaders from around the world have made their opinions known – for example, there have been open letters by Sens. Kerry and Durbin, and from the Bangladesh Caucus in the House of Representatives, as well as very public efforts by Secretary of State Hillary Clinton on Prof. Yunus’s behalf – while many hundreds of thousands of supporters in his country have rallied in protest. Online efforts are also picking up steam – if you haven’t already, please visit and “like” the SupportYunus page on Facebook, and sign one (or more) of the petitions below:

Where Do We Stand Now?
Prof. Yunus and the nine directors on the Grameen Bank Board who represent the Bank’s 8.3 million borrower-owners have petitioned the Bangladesh court system to stop the government’s attempts to dismiss Prof. Yunus from his position. During this appeals process, Prof. Yunus continues to serve in his role as Managing Director, because the Bank’s lawyers and many other legal experts believe that the Bangladesh Bank letter and ruling have no legal basis, because (among other things) the bylaws of Grameen Bank give its Board full discretion over the appointment of its managing director, and because of the precedent set by the many years of the BoB’s audits from 1999 to now that did not mention Prof. Yunus’s age.

The case is now in front of the Bangladesh Supreme Court, which was originally due to hear the petitions March 15 but instead adjourned for two weeks. During this time period, the Grameen Bank staff has continued to cooperate with the government, working toward a solution that ensures the independence of the Bank and that enables Prof. Yunus to retire and set up a succession plan in a considered, orderly fashion. This is what will be best for the poor people of Bangladesh, which has always been the prime concern of Prof. Yunus.

How You Can Help
Grameen Foundation remains concerned that the time before Supreme Court rules will be used by the government to step up its attacks against Prof. Yunus and Grameen Bank – in fact, we’ve already seen indications of this, with members of the ruling party making very personal attacks on the Parliament floor against Prof. Yunus. Because of this, it’s more important than ever that supporters of Prof. Yunus make their views as public as possible.

How can you do this? Here are a few ideas:

  • As mentioned above, please “like” the SupportYunus page on Facebook and tell your friends and families to do the same.  When positive stories and links are posted on this or other Facebook pages, please share them with your friends and family.
  • Please sign the petitions mentioned above.
  • On Twitter, please express your support by posting thoughts, articles, encouragement to join the Facebook page above, etc.   Use the hashtags #SupportYunus, #Yunus, #Grameen, #Socent, #YY and, on Fridays, use the “follow Fridays” hashtag (#ff) to build support.
  • If you have a blog, please post about the situation, or use your keyboard in other ways – write to your local newspaper or media outlet, to the Bangladeshi embassy near you, to the U.S. administration or State Department, etc.  Several supporters in the U.S. have had good luck convincing their member of Congress to issue a statement of support, so please try that.  Of course, if you read articles or blogs about Prof. Yunus and Grameen Bank, please show your support by leaving positive comments.
  • Grameen Foundation is a founding member of an organization called Friends of Grameen, which now has a website containing good background information on what’s happened so far.
  • Finally, we encourage you and your friends to stay informed by signing up for the Grameen Foundation e-newsletter (the link is available on the right side of most pages on our website), on this blog, the Facebook page above, or other sites, including the Grameen Bank and Yunus Centre websites.

One More Way You Can Help
Before wrapping up, perhaps I should clarify the relationship between Grameen Foundation and Grameen Bank, which are completely separate entities. Grameen Foundation has no operations in Bangladesh, and supports no microfinance institutions there.  That said, one reason Grameen Foundation exists is to promote the values of responsible microfinance pioneered by Prof. Yunus and Grameen Bank – transparent, accountable, measurable efforts to empower the working poor, especially women, through small loans and other financial services – throughout the world.  We will continue in that mission, which is possible only because of the generous support of people like you, who care about human dignity and damage that poverty causes to individuals and families every day.  We hope we can count on you for your support.

As always, we will continue to keep you informed as events develop. And, as always, if you have any questions or concerns in the meantime, please let us know.  If you have ideas about how to support Prof. Yunus, please leave them in the comments section!

Prof. Yunus


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