Positive Leadership

Bonus WEF Episode: Eliminating poverty through green energy (with Dr. Rajiv Shah)

May 26, 2022 Jean-Philippe Courtois
Positive Leadership
Bonus WEF Episode: Eliminating poverty through green energy (with Dr. Rajiv Shah)
Show Notes Transcript

JP's third bonus WEF guest is Dr. Rajiv Shah.

Rajiv has spent his career helping to solve many of society’s greatest issues – working to immunize the world with the Bill & Melinda Gates Foundation, serving as the Administrator of USAID under President Obama.

And now, as President of The Rockefeller Foundation, he is bringing green energy to people all around the world through the Global Energy Alliance for People and Planet, which aims to provide an onramp to opportunity for 1 billion people, while averting carbon emissions, expanding energy access, and creating jobs in the process.

Listen to the episode to hear all about his work, his passion and his dedication.

JEAN-PHILIPPE COURTOIS: Hello, podcast listeners. Jean-Philippe Courtois here. Welcome to another bite size episode of the Positive Leadership podcast, coming to you from the World Economic Forum’s annual meeting in Davos, Switzerland. For most of the half century since the World Economic Forum began, life improved for most people. Then COVID-19 hit, exposing and exacerbating inequalities between countries, just as it has within countries. Today, we are living in a divided world. Bridging the divide so we can solve problems like climate change together, is a key concern for my guest, Dr. Rajiv Shah. 

 

DR. RAJIV SHAH: You need lots of entrepreneurs, the people you just talked about. I want your podcast to be populated by superstar energy entrepreneurs. And you need philanthropies to come in and say there is some risk here so we’ll go first. We don’t need our money back but we do need to be able to measure that the work that’s being done is lifting people up the ladder of dignity and opportunity on this planet. And that’s our return. 

 

JEAN-PHILIPPE COURTOIS: For two decades, Rajiv Shah’s work to create innovative solutions to some of the world’s most pressing problems. Today he’s president of The Rockefeller Foundation, whose mission, unchanged since 1913, is to promote the wellbeing of humanity throughout the world. 

 

It’s a delight to meet you, Rajiv. Welcome to Positive Leadership podcast. 

 

DR. RAJIV SHAH: Thank you.

 

JEAN-PHILIPPE COURTOIS: Rajiv, let me start with a personal question. What has been the most defining moment of your childhood that shaped your purpose? 

 

DR. RAJIV SHAH: I actually grew up in Detroit, Michigan. My parents are from India. I had a chance when I was young to go back to India. On one of those trips, my uncle said, you and your sister, you’ve been here for a week. You’ve gone to all these places. I want to show you what the real India is like. And he took us into a slum community outside of Mumbai called Vashi, near Vashi and we spent half a day there. I’m now 49 years old. I was ten years old back then. I can close my eyes today and recreate the sights, the smells, the sounds. I can see the children playing in open, raw sewage, but playing and kicking balls and smiling. I can see the small huts with televisions and radios with life but also extreme poverty. And it was just a jarring experience. And I said why is it that some people are born in places where they would never even see this and others will spend their whole life in this kind of a lifestyle? It led to other experiences down the line that taught me that if you want to commit your career to helping people lead a better life, there are many avenues to do that. 

 

JEAN-PHILIPPE COURTOIS: Here we are in Davos, which is a place you’ve been to a number of times in different capacity, I guess, Rajiv. Which is a place for listeners to bring together what... has been calling multistakeholder dialogue. Let me ask you a very dark question. Do you think it’s a place to have a tough conversation as well about a divided world in a way, because there’s some real issues. I know you are super clear about the fact we are going backwards and the UN SDG goals by 2030. We are tracking what’s going on. Do you think it’s a place actually to make significant progress to all those goals? 

 

DR. RAJIV SHAH: I think to make progress against goals that are about sustainable development and global goals requires people from all walks of life and so many different parts of the world to at least have a shared understanding of what’s achievable and what’s roughly the path there. And to the extent that this can be a place where there’s debate about that, it’s fantastic. I’ll say what separates Davos from other settings where there’s a debate is that you really do have private sector leaders here. And that, I observe two things related to that. One is it gives you a different perspective on how to build public private partnership to accelerate progress. But it also does illustrate what’s talk and what’s action. I think we have to be much, much, much more disciplined about forcing action under these conversations. 

 

JEAN-PHILIPPE COURTOIS: A call to action as opposed to just to talk. 

 

DR. RAJIV SHAH: As opposed to just talk about it. But look, I think it’s just useful for more people to see the challenges we face as a global community. 

 

JEAN-PHILIPPE COURTOIS: With the pandemic, the world has seen the levels of extreme poverty rising for the first time ever in a generation, with an additional, I was told, 120 million people pushed back into extreme poverty. But I also hear you talking about a need to redefine the extreme poverty threshold. And to maybe replace it by energetic consumption per day and per person proxy. Can you tell us why energy consumption matters so much when you are living at the bottom of the pyramid. I think it’ll be really enlightening for our listeners. 

 

DR. RAJIV SHAH: First, it’s important to know how we’ve been measuring poverty for 70, 80 years. It’s basically been based on a basket of goods that correlates with the likelihood that you’ll consume about 2,100 kilocalories per person per day. And that might have made sense back when 40% or 50% of the world’s global population lived at the bottom of the pyramid, as you put it. After World War II that was basically the case. Since then we’ve had so much progress that it really is time to redefine what poverty really is. When I ran US Aid we did something called constraint to growth analysis in country after country. And no matter where we did the analysis the result was always the same. It was access to infrastructure and notably, energy and electricity. You can imagine, if you’re a girl and you live in village in Northeast India and the government might say there’s power going to that village because there’s a line that goes to some site there but there’s no real power that comes to you. You wake up in the morning and you go fetch water on your own. You might be sent out to go collect firewood. You probably don’t go to school. If you go to school you can’t read at night because it’s dark. That’s just one part of the picture. On the other hand, if you are in a community that’s able to provide electricity to every family, all of a sudden, people pay for it. It’s the most important thing they have, they value. People use that power to get sewing machines, power sewing machines and make product and earn income. 60, 70% of the world’s poorest families are in agricultural production. Post-harvest agricultural processing with power equipment is total different in terms of value addition and value creation and crop preservation. So you can’t really build a pathway up the economic ladder from the very poor if you don’t have access to electricity. And Jean-Philippe, you wouldn’t even believe, as we sit here today, 850 million people don’t consume enough power to light one small appliance and one lightbulb in their home for a year. The UN classifies that as 150 kilowatt hours of consumption per capita per year. We’ve argued that the modern energy minimum should be 1,000 kilowatt hours per capita per year. After that you can start to move yourself up the ladder but before then you can’t. Guess how many people live under that threshold? 

 

JEAN-PHILIPPE COURTOIS: I don’t know. A few hundred million. 

 

DR. RAJIV SHAH: 3.6 billion in 81 countries around this planet. 

 

JEAN-PHILIPPE COURTOIS: Mind blowing. 

 

DR. RAJIV SHAH: It’s mind blowing. 

 

JEAN-PHILIPPE COURTOIS: Building on that, the Rockefeller Foundation is spearheading these global energy alliance for people and planet, a coalition of charitable foundations, unilateral lenders, which all want to unlock $100 billion dollars for low carbon development this decade. Can you tell us more about that energy initiative and your role, of course, with it, the way you lead that, Rajiv. 

 

DR. RAJIV SHAH: This initiative is called the Global Energy Alliance for People and Planet. And the goal is very simple. It’s the reach a billion people who live today in the dark. 

 

JEAN-PHILIPPE COURTOIS: One billion. 

 

DR. RAJIV SHAH: One billion, with renewable electricity and to accelerate the energy transition from coal to renewables in these developing and emerging economies. The reality is today we have technology that actually solves the problem. You can have distributed small scale mini grids, solar installations tied to lithium ion batteries run remotely by artificial intelligence. I don’t need to tell you about AI. And at $0.22, $0.23 a kilowatt hour, you supply energy to people who have never had it before. So to give you one example of the power of this, the Global Energy Alliance in India is partnering with Tata Power to build 10,000 of these mini grids and move 25 million people out of power. And the beauty of it is Rockefeller and others are putting in some catalytic capital but most of the financing for this will come from local banks, Tata, the Indian customers who pay their bills, even though they’re very poor because they know this is their chance to move out of poverty. 

 

JEAN-PHILIPPE COURTOIS: That is so powerful. It reminds me of the very early days of microfinance and [INDISCERNIBLE 00:09:37] when he took a bet on those people and starting that [PH 00:09:43] microlenial money and where people were, I think, actually paying back like 98% of the people. And you confirm just that reality. Those people [INDISCERNILBE 00:09:53] of being trusted. 

 

DR. RAJIV SHAH: Absolutely. In fact, when Muhammad Yunus did that, they had these women self-health groups that helped manage the repayment. Now you don’t even need that. We have smart metering and the smart metering allows a family to pay for just the amount of power they use, pay on their mobile automated system, and titrate what they can consume based on what they really can afford. And what we’ve seen in India, we’re serving almost 700 or 800,000 people now in India. We’re going to be reaching 25 million. Before those 800,000, 50% of the businesses create jobs when they switch and they create 2, 3, 4 jobs because these are small, single proprietor enterprises and people move out of poverty. It works. It’s measured. We have data. We can prove it. I think this is an idea whose time has come and we’ve partnered with the Ikea Foundation and Bezos Earth Fund and about a dozen other banks and development banks and raised about north of $10 billion to reach a billion people around the planet. 

 

JEAN-PHILIPPE COURTOIS: That’s quite amazing. When you think about those different stakeholders, you’ve got Rockefeller Foundation, wonderful. Ikea, which is a business. And you also have, of course, all those international development banks existing. But I also see and meet a number of social entrepreneurs who are innovating in that space. I actually had on my podcast one of them, who had been building those kind of solar smart grids connected with AI data platform enabled and we support them as Microsoft, as a company. How do you see the role of those different stakeholders? Either way you can build the momentum to get all the way to the 3.6 billion people you are talking about. Is that a dream or is there a way to crack that? 

 

DR. RAJIV SHAH: That’s a target and we have a strategy. There is a way to crack that. And it comes down to one basic concept that is a traditional African proverb, which is if you want to go far, go together. If you want to go fast, go alone. We want to go far and that means building these partnerships. Nigeria is a good example. You do need some degree of capital subsidy from governments to make this work and they’ve created a results based financing fund to do that with the African Development Bank and the World Bank. You need lots of entrepreneurs, the people you were just talking about. I want your podcast to be populated by superstar energy entrepreneurs that are changing their economy. And we do that with local partners and private sector partners. You need commercial investment and local debt capital from banks and you need philanthropies to come in and say there is some risk here so we’ll go first. We don’t need a return. We don’t need our money back. But we do need to be able to measure that the work that’s being done is lifting people up the ladder of dignity and opportunity on this planet. That’s our return. And so you put it all together and you can go very, very far. 

 

JEAN-PHILIPPE COURTOIS: I’d like to continue the discussions, Rajiv, about your leadership philosophy. It seems to me that you have a very unique combination of leadership skills. First of all, you are someone doing a fantastic job painting the picture for bold change that is appealing to other stakeholders. Secondly, I think you’ve done a wonderful job building transformative partnerships with very different type of entities. You just talked about that for the alliance example. You’re also extremely gifted at driving a sense of urgency. So my question is how did you shape, learn, and grow such positive leadership strengths yourself and did you have any inspiration from some people along the way? 

 

DR. RAJIV SHAH: I learned a lot from others and I learned from a doctor that I worked with in a rainforest in Southern India before I went to medical school. I learned about just sacrifice, what it means to go live with a community, listen to them, learn from them, not bring your expertise to the table because you’re there to listen and learn and earn their trust, first and foremost. Then I got to work with Bill Gates and I learned about that it was possible to sit in a dining table or a conference room and say why aren’t we immunizing every child on the planet? That’s just wrong. Tell me how you’d fix it. And I don’t think a lot of people ask such simple, yet totally transformational and bold questions and then stick with it for decades until it gets done. I learned from others as well. I learned from one of my colleagues at US Aid who was an extraordinary woman who ultimately lost her life in Haiti in an accident. But I learned about why people serve. Because they want their lives to speak and they believe – they know they’re serving their country and how powerful that desire for purpose is and how beautiful that expression of human purpose can be. So I just get to learn from so many different types of people and I think we just keep learning and piecing it together as we go. 

 

JEAN-PHILIPPE COURTOIS: Before I get to the final question, Rajiv, I need to ask you a question about the way you see the business community stepping up to the plate. I know you and I had a chat on that. And the world is going through a lot of changes these days. We saw a pandemic. We got probably a recession going on in the world, high inflation, war in Europe, Russia and Ukraine, which is very sad. Personally, I’m an optimist, as you know. Like you I think I’m an optimist. And I do believe that in a way, the corporate way is going to really move away from CSR or philanthropy. Not that it’s bad. It’s great. But really embed design at the core of the product, the services, the supply chain, and consistently run the way they contribute to the world. Do you see the same or are you less optimistic about the way it’s going to happen? 

 

DR. RAJIV SHAH: I see that. I see that and I’ve seen it in companies. I’ve seen it, frankly, in employees and frankly, younger employees in companies that just say if I’m going to work at General Mills, I want to know that there are teams of people going from here to Malawi to help agriculture and food systems in a place that really needs it. I want to know that we’re addressing food and hunger in Afghanistan when people are going hungry and it’s on television because we have that skillset. And I could name 50 other companies where that sense is so extraordinary. That said, I think since World War II we’ve had a convergence in the world and people have been coming out of poverty at a very high rate. And as you mentioned in your opening, between COVID and now the Russia-Ukraine war and the food and fuel crisis that that is accelerating, the response to COVID that was highly inequitable, less than 20% of people in developing countries have even a single shot of the vaccine, we’re now looking at a decade of divergence. We’ve never lived through that before. That means year after year lower income countries grow slower than wealthier countries and instead of catching up and reducing global poverty, we are unwinding the progress we’ve made. In light of that reality, what you said about companies needs to be accelerated dramatically. It’s no longer okay to just think of this as kind of corporate philanthropy. And even if you have some kind of an ESG scorecard and you’re struggling to think it through, that’s fine. But I think business leaders have to come up with a real sense of purpose and embed that sense of purpose in the core business and then stakeholders and shareholders and society and employees and young employees need to hold them accountable. And we can’t just let the progress we’ve made go away because of a market downturn or because of financial pressure or because of this great divergence that is taking hold in our global economy. 

 

JEAN-PHILIPPE COURTOIS: Rajiv, Dr. Rajiv Shah, thank you so much from the bottom of my heart. It’s been a delight. Fantastic moment, Rajiv. Thanks a lot for sharing that with our listeners. 

 

DR. RAJIV SHAH: Thank you so much for having me. 

 

JEAN-PHILIPPE COURTOIS: Thank you. 

 

That’s president of the Rockefeller Foundation, Dr. Rajiv Shah. To hear more from the inspiring global leaders who are making a difference, subscribe now to the Positive Leadership podcast with me, Jean-Philippe Courtois. Goodbye. 

 

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