Social Impact Investors: How Abha-Thorat Shah of Social Finance British Asian Trust Is Helping To…

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Social Impact Investors: How Abha-Thorat Shah of Social Finance British Asian Trust Is Helping To Empower…

Flexibility and agility: the development sector is dynamic, with many external risks and variables that can be beyond one’s immediate control. Even without the uncertainty brought about by the pandemic, models that have not been nimble enough to quickly learn, iterate, adapt to changing circumstances and managed change have struggled to be successful.

As a part of our series about “Social Impact Investors”, I had the pleasure of interviewing Abha Thorat Shah.

Abha leads Social Finance for the British Asian Trust across South Asia. She is a founding member of The British Asian Trust and has contributed to its design and leadership during the start-up years and now to its growth.

Abha has over 15 years’ experience working on strategic programmatic solutions, tackling complex issues throughout South Asia. Her expertise and ability to leverage key cross-sector partnerships has led to the development of our flagship programmes in the region. Abha has also been a crucial driver of the development of innovative social finance mechanisms, heightening the Trust’s entrepreneurial approach to philanthropy to meet Sustainable Development Goal targets. In recognition of British Asian Trust’s work in this area, Abha is also a Fellow of Practice 2020 at the Go Labs, Blavatnik School of Government, University of Oxford.

Abha has extensive experience of creating and nurturing philanthropic, business and cultural relationships between the UK and South Asia and practical experience of both the private and not-for-profit sectors. Before coming to the Trust Abha was the Chief Operating Officer of the UK India Business Council after five years in the Reinsurance markets in London. She grew up in Mumbai, India and graduated with a BA in Political Science from the University of Mumbai and a BA Hons in Social and Political Sciences from Cambridge University.

Thank you so much for your time! Before we dive in, our readers would love to learn a bit more about you. Please tell us what brought you to this specific career path?

My motivation has always been a passion for seeing South Asia grow and develop into a prosperous and equitable region. From the reinsurance markets of India where I focussed on understanding risk, to being part of the team setting up the first B2B organisation linking the UK & India (UKIBC) — I have been lucky to be part of a wide range of projects. Have ideated on the British Asian Trust (BAT) with our Trustees and enable its growth. Have developed large impact focussed projects through my current role as head of social finance practice at BAT.

A single thread of working for the region and its development has always inspired me. Whether public sector, corporate sector, or development sector, I continue to believe that social impact should be core to any agenda and needs us all to work collectively. True impact happens when the right people use the right skills to do the right things and creating opportunities to bring these together in any role is what excites me the most.

Please share the most humorous mistake you made when you were first starting? What lesson or take-away did you learn from that?

A few years ago, I was in Delhi to visit one of the government’s schools participating in our education project. When I reached the school, it was immaculately clean, well-organized, with teachers and students in full attendance. On my drive back from the school to the airport, I struck up a conversation with my driver and beamed about this school functioning so well. The driver looked at me from his rear-view mirror and remarked, “Madam, this school generally remains closed. They organized a special day because they knew you were visiting!”

The development sector can sometimes be prone to a little show-and-tell, especially when funding organizations undertake field visits to project sites, with a smooth, glossy version of on-the-ground reality presented to us. From that day onwards, I made it a point to have candid conversations with all my drivers!

Are you able to identify a “tipping point” in your career when you started to see success? Did you start doing anything different? Are there takeaways or lessons that others can learn from that?

Two humble realizations have shaped my career:

  1. Understanding and acknowledging that I alone could not accomplish much and that I needed the passion, skills, competencies, and resources of others to make a difference. This allowed me to do what I was good at and enjoyed doing — navigate and negotiate creative solutions that would bring people from different walks of life together in unusual ways to collectively solve a problem.
  2. Seeing the folly in our approach as funders or investors, where we often tend to put ourselves at the centre of all conversations and hoard a lot of power in any relationship or project. We dictate the terms and take the credit if a project is successful but point fingers at social organizations and their much-maligned lack of capabilities or systems if things go south. We do not ask tough questions of funders/ investors or hold them to the same scrutiny or standards. This power imbalance is damaging and dangerous.

Both these realizations have shaped my work in social finance at BAT. It allows me to bring expertise from across the board — finance, government, and the non-profit sector together in one place to shift the narrative from ‘what we are doing’ to ‘what change we are delivering’. I have been involved in designing projects that use new approaches (such as result-based financing) and tools (such as development impact bonds) that use financial sticks and carrots to incentivize end impact and create a more level playing field between those with resources (funders) and those with execution expertise (social organizations).

We have applied our learnings to many large scale, transformative initiatives in education, including the Bharat EdTech Initiative (BEI). This project marks a new milestone for us as we are introducing the principles of result-based financing to the world of EdTech in India, trying to shift the thinking and the programming from providing access to more and more students to engaging them better.

You have been blessed with great success in a career path that many have attempted, but eventually gave up on. Do you have any words of advice for others who may want to embark on this career path but are afraid of the prospect of failure?

My advice is always to follow your purpose and do what you enjoy- success always follows. The second piece of advice is from my current boss — he once told me that through most of our early careers, we spend a lot of time and energy overcoming our weaknesses. But as we progress and get into roles of leaders and managers, it really helps if we focus on what we are brilliant at, while surrounding ourselves with others who have skills at doing what we lack!

The world is currently facing a very important self-reckoning about race, diversity, equality and inclusion. This is of course a huge topic. But briefly, can you share a few things that need to be done on a broader societal level to expand Impact Investing opportunities for women, minorities, and people of color?

Diversity, equality, and inclusion are at the centre of our ethos at BAT, with the motto ‘leave no one behind.’ This principle reflects in our projects across South Asia, contextualized to local realities. For example, in India, Bharat EdTech Initiative aims to bridge the digital learning divide between the have and the have nots i.e., children from urban, affluent classes who have access to EdTech solutions and have benefitted from it. And children in low-income, marginalized communities who do not have the necessary resources to access these solutions.

Within this, we realize that girls inadvertently get left out of digital interventions as they typically do not own devices or get a fair share of common devices that their families have. This project has a strong focus on gender to ensure girls have access to EdTech solutions. It also aims to reach children in rural and tribal areas. In fact, 70% of all children enrolled so far are from rural areas of India, across 15 states. 90% go to government schools, which are free and therefore preferred by low-income populations who cannot afford fees for private schools.

You are an Impact Investor who is focused on investments that are making a positive social impact. Can you share with us a bit about the projects and companies you have focused on, and look to focus on in the future?

We have so far launched three projects that use results-based approaches, with one more in the pipeline. Cumulatively mobilizing $20 million to date Supporting 350,000 people in India, with another $25 million in the pipeline, in the areas of education and employment.

I want to talk about our latest project — Bharat EdTech Initiative (BEI). EdTech market has seen rapid growth in the last few years, and Covid-19 has provided it with strong tailwinds. However, these innovative EdTech solutions are not reaching India’s economically disadvantaged children. BAT has partnered with the BEI, led by the Michael & Susan Dell Foundation along with Sattva and Give India, to bring EdTech solutions to children from low-income households in India and improve learning outcomes. The Initiative addresses the current gap in the EdTech market by providing a holistic solution that is affordable, inclusive, and engagement driven.

As part of this project, BAT is piloting, along with the BEI consortium, a performance-linked grant, wherein a proportion of overall funding is triggered only when engagement (time spent on the app) and learning outcomes are achieved and verified by an independent evaluator. This is an attempt to ensure that all partners are incentivized to drive the result of children’s learning improvements, not just enrolment or the distribution of devices.

By publishing results in the public domain, performance-linked grants can be brave and transparent tools to hold all project partners accountable for end outcomes. The fact that the BEI teams were open and willing to do this, shows their commitment to putting learning outcomes for children at the heart of their project.

Through this initiative, we aspire to enable access to digital education for 1million underprivileged children in India and demonstrate improved learning outcomes by 2025. In the pilot phase that started in August 2021, we have already enrolled 100,000+ children and are now focusing on driving up engagement using various nudges.

Can you share a story with us about your most successful investment? Or an investment that you are most proud of? What was its lesson?

Bharat EdTech Initiative (BEI)I is providing EdTech solutions for economically disadvantaged students that tailor instructions according to their learning levels, alongside active parent engagement. BEI is one of the first initiatives in India to explicitly drive an outcome mindset among large EdTech players. It also incentivizes for-profit and non-profit organisations to leverage their strengths and work in a collaborative manner. While we await the results, the programme has enrolled 116,000 children in partnership with five leading EdTech providers and their non-profit partners. A hardware-focused pilot is also planned to start in February 2022, to address the issue of low access to devices that can utilise EdTech solutions.

We have realized that when focusing on low-income and rural communities, the programming needs to be sensitive and fine-tuned to address their specific needs. For example, we have prioritized apps that have content in regional languages. We also have an extensive focus on encouraging usage through multiple nudges given that many of these children are first-generation learners and can operate through simpler apps such as WhatsApp.

Similarly, while we want to push for a result-based approach, we are also realizing the challenges in setting suitable targets for outcomes given the nascency of our idea and diversity of solutions, lack of robust benchmarking data and lack of processes to measure and report outcomes. We are actively working towards addressing these challenges and incorporating the lessons learnt in our scale-up phase.

Super. Here is the main question of this interview. What are your “5 things I need to see before making an investment” and why? Please share a story or example for each.

1. Ability to see the big picture: Social problems and solutions do not exist in isolation. they are influenced by, and in turn, influence economic, political, legal, cultural contexts. It is important that the investee is clear about the problem it is solving and place one’s solution in the larger context. Being able to connect the dots and understand one’s role in relation to other actors makes for a more comprehensive and nuanced solution, which does not work in a silo or develop a tunnel vision. This has been amply demonstrated in our BEI project. While we are solving for digital learning at home, we have realized that the app is only one part of the solution, we must solve for infrastructure constraints, the role of teachers and schools, and mechanisms to nudge parents, much beyond the remit of any single app.

2. Flexibility and agility: the development sector is dynamic, with many external risks and variables that can be beyond one’s immediate control. Even without the uncertainty brought about by the pandemic, models that have not been nimble enough to quickly learn, iterate, adapt to changing circumstances and manged change have struggled to be successful.

3. Quality of people: All ideas and organizations are eventually as good as the people leading them. A wise investor bets not only on the entrepreneur’s potential but also his/ her ability to attract and retain talented and entrepreneurial individuals who have the complementary set of skills and can take initiative.

4. Scale: Given the nature of South Asia, even a minimum viable scale can easily mean covering tens of thousands. It is important to understand if a solution has been designed for scale, even if it is executed as a pilot, can it be replicated over time? Either by the organization itself or by others? And, especially by governments?

5. Additionality of investment: What is the value-add of our investment and is it needed? Resources are scarce and demand always outstrips supply. We must consider the opportunity cost of our investment and have realistic expectations on the quantum of our investment and the degree of change it can achieve.

You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂

I wish I did have the influence you speak of. But for a moment, let’s imagine I did! My movement would be something that allows everyone — in any walk of life — to be part of social change. I think all of us, through our work and life, can make positive changes in our societies, the environment and our future. Solving social and environmental problems cannot just be the governments’ or the development sectors’ role. It is incumbent on all of us as individuals to play our part by leveraging all our strengths!

Let me use a story to illustrate this. My best friend in India works in mass communication and is involved in creating some of the most successful television dramas and soap operas. Imagine her ability to reach millions of people and influence their mindsets and behaviours on social issues! It is without doubt, many times more than what the development sector can ever imagine or command! That power of an individual to make a difference doing what they are best at — is the type of movement I would like to back!

We are very blessed that a lot of amazing founders and social impact organizations read this column. Is there a person in the world with whom you’d like to have a private breakfast or lunch with, and why? He or she might just see this. 🙂

Two people, representing different ends of a spectrum, but remarkably similar in their intent, ability to disrupt and audacity:

  • Ela Bhat — For her revolutionary work in grassroots development and women empowerment
  • Paul Poleman — For his bold and audacious vision and work on how the corporate sector can be a force for good

How can our readers follow you online?

I can be reached through my LinkedIn Profile or my Twitter profile.

Thank you for these fantastic insights. We greatly appreciate the time you spent on this.

Social Impact Investors: How Abha-Thorat Shah of Social Finance British Asian Trust Is Helping To… was originally published in Authority Magazine on Medium, where people are continuing the conversation by highlighting and responding to this story.