‘Microfinance institutions are often structured as social enterprises that are financially sustainable, meaning they do not rely on grants or subsidies to operate. This allows them to continue providing financial services to low-income individuals over the long term.’
Tutor2u.net website
Microfinance has taught us a great deal about delivering sustainable change, and this quote encapsulates a key part of why it is so successful: it prioritises attitudinal transformation. Behavioural change is rarely delivered by instant solutions. One such example is that promoted by Thomas Picketty who, notwithstanding his book, ‘Capitalism in the 21st Century’ describes himself as a ‘Participatory Socialist’.
He envisages the substantial and unconditional receipt of inheritance on the occasion of each person's 25th birthday, a similar proposal to the idea promoted some years ago by the Resolution Foundation. But you cannot just dump huge amounts of money on a young person and expect a radical change in their outlook.
Attitudinal transformation takes time, and it involves the realisation of a complete change in perspective. This enables young people to look forward with a constructive approach towards achieving their potential in our fast-changing world.
It’s not just economic participation which calls for attitudinal transformation. Both peaceful co-existence and care for the environment require deep and widespread growth in understanding; the prevalence of short-termism, particularly among politicians, makes this very difficult to achieve.
In theory, the founding purpose of education is not simply to share knowledge but also to transform attitudes: but, because its focus is on rewarding higher achievers, it has a limited impact across society as a whole beyond preparing young people for the workplace. Even in key areas such as financial awareness its impact is very limited: only 25% of young people in the United Kingdom consider themselves properly prepared for adult life in terms of financial education on leaving school.
At The Share Foundation we have learnt how to achieve attitudinal transformation during the past decade: in our work for young people in care we have seen how incentivised learning is central to making it work. The process starts with enabling young people to earn additional money by completing individual learning stages, but this turns into a deep appreciation of the content of those stages. As a result, the experience of learning achieves a significant reduction in their NEET rates when these young people reach adulthood.
Piketty speaks of an ‘unconditional basic inheritance on their 25th birthday’; but it is the learning progress achieved through their conditional receipt of incentives that deepens young people’s understanding and shows how to make the best use of their endowment of resources. Without this, its impact on breaking the cycle of deprivation is limited.
The appreciation of ownership which leads to a real sense of responsibility (so evident with home ownership) builds over time.
It is because microfinance is based on loan funding rather than grant giving that it embeds a process of continuing accountability, allowing that appreciation of ownership to build, and that enables the attitudinal transformation which in turn allows its beneficiaries to start or expand their businesses and increase their income.
There is, however, another attitudinal aspect upon which microfinance relies: the empowerment of women. As Tutor2u explains, microfinance programmes usually target women with access to credit and training. As Muhammad Yunus explained to me ten years ago, this approach reflects women’s ability to work with others and care for their community, which are both key characteristics of servant leadership.
However, as we commented on 12th May, ‘The Fallacy of Male Headship’, it is neither morally nor logically correct to exclude young men, although servant leadership doesn't come so naturally for them: this also calls for attitudinal transformation.
We have again seen a rash of excess masculinity during the past week, both in the breakdown of the relationship between Trump and Musk in the U.S. and in continued violence in the Middle East and Ukraine. Peaceful coexistence and increasing global co-operation rely on replacing the reach for male dominance with a deep understanding of what servant leadership means.
As we explained in that commentary, Christian Churches could do much to contribute in this area, as they have not only the necessary teaching in the Gospels but also direct experience of the worst aspects of male dominance.
Then there is the environment, where it seems so difficult to raise awareness of the real risks to our world if we don't take climate change seriously. The warnings of irreversible glacier melting and the steadily increasing evidence of sea level rise should tell us that urgent action is required; but the emphasis on moving away from fossil fuels is restricted to those who can afford it. There are comparatively few who are not prepared to discount the future.
Do we have to wait until sea level cities across the world are flooded before proper attention and priority is given?
The problem is that attitudes are baked into human experience over the centuries, and they are hard to shift. But the impacts of wealth polarisation, world tensions and climate change are growing fast, and we cannot afford to ignore the need to transform those attitudes, or to assume that instant solutions can always be applied within single parliamentary terms.
We therefore need to look for the conditions within which attitudinal transformation can take place. Whether it's incentivised learning for financial awareness, servant leadership characteristics for peaceful co-existence, or sharing across our populations the implications of wrecking our environment, we need to focus on the conditions, not just the actions, necessary for achieving the necessary changes in people’s attitudes.
Gavin Oldham OBE
Share Radio