Eye-Witness Accounts of Akula's Humble Harvard Talk

Two Kennedy School students who were there have blogged Vikram Akula's remarkable mea culpa.Hala Hanna provides more detail than I've seen anywhere else (and a great photo):

He said he was so focused on scaling the SKS model that he did not take the time to anticipate the potential downsides of tapping into the public market. He admitted: “it’s so hard to control for the unintended consequences of your work”. Akula says his views on microfinance have changed drastically in the past year. He used to think the three main challenges of Microfinance were lack of Capital, lack of Capacity, and high Costs. Today, he argues for a new set of 3 Cs: Culture, Code of Conduct, and Control. First, a founder’s challenge is to make sure the Culture of passion persists when [she/he] leaves and is replaced by a regular CEO in a suit. Second, a solid Code of Conduct is even more crucial in a context of vulnerability like the one faced when working for the bottom of the pyramid. Rules in this context have to be adapted to the communities. And finally, Control: social entrepreneurs are naïve, Akula pleaded.

Friday’s Washington Post/Associated Press story recapping, in grim detail, the manner by which SKS loan officers did push borrowers to unthinkable limits, all while top management knew, understandably left me feeling betrayed, irate, and incredulous. How could its top management have been so irresponsible as to have hidden the evidence and continue to deny any culpability? This was an affront not only to the families that had suffered the loss of one of their own but to all SKS borrowers that had placed trust in them, and to the hundreds of thousands who were once again deprived of a much-needed instrument of financial access.Vikram Akula was set to speak at the Harvard Social Enterprise Conference, organized by the Harvard Kennedy and Business Schools, the next day, and I was ready to put forth tough questions about all that had happened.I could never have predicted what actually ensued. My anger was replaced by shock, first by his demeanor, one that was visibly shaken and sincerely remorseful, and by the courage it must have taken to say what he related to us.