On October 18, DCU recognised the world’s leading social entrepreneur Professor Muhammad Yunus by awarding him an Honourary Doctorate.
The 74-year-old Nobel Peace Laureate founded the Grameen Bank and pioneered microfinancing – the concept of giving small loans to those too poor to qualify for traditional bank loans. Yunus also serves on the board of directors of the United Nations Foundation.
However, in 2011, the Bangladesh government fired Yunus from his role at Grameen Bank, citing legal violations and an age limit on his position. Yunus is appealing the position.
How was a healthy able man, who a month prior had co-founded a global social initive project allowed to be ousted from his own organisation?
Allegations of embezzlement and loan sharking have plagued Yunus since 2010. Danish film maker Tom Heinemann alleged in his documentary, Caught in Micro Debt, diverting 7 billion taka (about $100 million) given by the Norwegian Agency for Development Cooperation from Grameen Bank to another organisation in 1996. Though NORAD went on to clear Yunus of any wrong doing, the story was widely spread by the Bangladeshi media.
“Rather than first seeking clarification and response from Grameen Bank as to the validity of the TV programme, the media and society pounced on it with unseemly enthusiasm, using it as an opportunity to cite wrongdoing,” Bangladeshi economist, Rehman Sobhan, commented.
The Bangledeshi government has proven to be Yunus’ biggest opposition, despite owning a 25 per cent stake in the bank. Yunus attempted to found his own political party in 2007, much to the upset of Prime Minister Sheikh Hasina. The government launched an investigation in 2011 into Grameen Bank’s activities, despite the bank being cleared by the Norweigian government of all allegations of misused funds. This fuelled suspicion that the attacks might be politically motivated.
Hasina accused Prof Yunus of treating Grameen Bank as his “personal property” and claimed that it was “sucking blood from the poor”. The Friends of Grameen group alleged that Prof Yunus had been subjected to “politically orchestrated” and “increasingly aggressive” attacks.
People began to question the effectiveness of microfinance and microfinance institutions (MFIs). Policies of coercion, peer pressure and harassment were reportedly enforced in some specific MFIs.
This, on top of Grameen’s reported 23 per cent interest rate and tax free status, though the latter has recently been removed, has undermined Yunus’ and Grameen’s credibility.
At 72, he was 12 years beyond the legal retirement age for civil servants in Bangladesh in 2011. Government spokespersons called for Yunus to step down and declared: “We need to redefine the bank’s role and bring it under closer regulation.”
Muzammel Huq, the government-appointed chair of Grameen Bank publicly criticised Yunus, saying: “I think he is a good man with a small heart … He cannot give credit to anyone but himself.”
Despite his ousting, Yunus has continued his crusade against social injustices, most recently calling on Obama to release a report by the US Senate into the use of torture in the early years of the War on Terror.
By Fionnuala Jones