Sri Lanka Wonder of Asia An Indian Ocean island republic famous for its tea, coffee and cinnamon, Sri Lanka bore the brunt of the 2004 Asian tsunami. BRAC quickly responded to the disaster by setting up relief and emergency operations in 2005. Since then, BRAC has expanded its outreach, touching the lives of an estimated 527,000 Sri Lankans, helping to improve livelihoods through rigorous capacity development training and providing over USD 74.2 million in microloans, with 74,000 active borrowers across the country’s 15 most vulnerable districts. What started out in 1972 in a remote village of Bangladesh as a limited relief operation BRAC - has turned into the largest development organisation in the world. Of major nongovernmental organisation, it is one of the few based in the global south. Today, BRAC is a development success story, spreading solutions born in Bangladesh to 10 other countries around the world – a global leader in creating opportunity for the world’s poor. Organising the poor using communities’ own human and material resources, it catalyses lasting change, creating an ecosystem in which the poor have the chance to seize control of their own lives. We do this with a holistic development approach geared toward inclusion, using TOOLSÖLIKEÖMICROÙNANCE ÖEDUCATION ÖHEALTHCARE ÖLEGALÖ services, community empowerment and more. Our work now touches the lives of an estimated 126 million people, with staff and BRAC-trained entrepreneurs numbering in the hundreds of thousands – a global movement bringing change to 10 countries in Asia, Africa and the Caribbean, with operations in our 11th country, Philippines, being launched in 2012. BRAC LANKA (GUARANTEE LIMITED) 40th Year Special Edition Harnessing the past Enriching the future Contents Our Mission, Vision and Values 01 Chairperson’s Statement 02 0LFURÛQDQFH Governance 08 Management 09 Development partners 09 BRAC across the world 10 Harnessing the past 12 Financials 15 1 BRAC Annual Report 2011 Vision, Mission and Values Vision Mission Values A world free from all forms Our mission is to empower Innovation of exploitation and people and communities in For forty years, BRAC has been an innovator in the creation of opportunities for the poor to discrimination where situations of poverty, illiteracy, lift themselves out of poverty. We value everyone has the opportunity disease and social injustice. creativity in programme design and strive to display global leadership in groundbreaking to realise their potential. Our interventions aim to development initiatives. achieve large scale, positive changes through economic Integrity and social programmes that We value transparency and accountability in all our professional work, with clear policies enable men and women to and procedures, while displaying the utmost realise their potential. level of honesty in our financial dealings. We hold these to be the most essential elements of our work ethic. Inclusiveness We are committed to engaging, supporting and recognising the value of all members of society, regardless of race, religion, gender, nationality, ethnicity, age, physical or mental ability, socioeconomic status and geography. Effectiveness We value efficiency and excellence in all our work, constantly challenging ourselves to perform better, to meet and exceed programme targets, and to improve and deepen the impact of our interventions. 2 BRAC Annual Report 2011 Chairperson’s Statement It gives me great pleasure to present the ANNUALÖREPORTÖANDÖTHEÖAUDITEDÖÙNANCIALÖ statements for the year ended 31 December 2011. The year concluded saw Sri Lanka engaging in large-scale reconstruction and development projects following the end OFÖTHEÖ YEARÖCONÚICTÖWITHÖTHEÖ,IBERATIONÖ Tigers of Tamil Eela, including increasing electricity access and rebuilding its road and rail network. Sri Lanka now seeks to reduce poverty by using a combination of state directed policies and private investment promotion to spur growth in disadvantaged areas, develop small and medium enterprises, and promote increased agriculture. In a country with a population of over 21 million, the unemployment rate is relatively low, standing at 4.3 per cent as of 2011, the lowest yet for the country. Continued employment generation was due to reconstruction, infrastructure development and expansion of economic activities. In 2011, BRAC Sri Lanka began its agricultural development programme to provide farmers living below the poverty LINEÖWITHÖAGRICULTURE SPECIÙCÖCREDITÖSUPPORTÖ With the support of our development partner Etimos, 471 farmers in this programme have received orientation and input support for the cultivation of cocoa plants which they can sell to Etimos’ cocoa factory, based in Sri Lanka, at a fair wage. BRAC Annual Report 2011 3 BRAC continues to provide relief in areas Through our extensive global experience I take this opportunity to commend our suffering from environmental disasters. INÖMICROÙNANCE ÖWEÖKNOWÖTHATÖLIVELIHOODÖ team in Sri Lanka who have worked with With the support from Stromme development works best when it goes enduring commitment and loyalty to Foundation and food donations from its beyond providing loans. In Sri Lanka, engage every opportunity that has come BENEÙCIARYÖFARMERS Ö"2!#ÖHASÖPROVIDEDÖ "2!#lSÖHOLISTICÖMICROÙNANCEÖPROGRAMMEÖ our way. The quality of our performance ÖPEOPLEÖAFFECTEDÖBYÖTHEÖÚOODSÖINÖ acts as a capacity-building platform. is attributed to this remarkably competent eastern Sri Lanka in February 2011 A combination of local knowledge and team, their knowledge, skills and with dried and cooked foods while they rigorous training means that our staff professionalism. I extend my sincere focused on rebuilding their livelihoods. are best placed to support the poorest, thanks to the members of the governing At the request of the government of Sri MOSTÖMARGINALISEDÖBENEÙCIARIESÖINÖTHEIRÖ body, whose leadership and foresight has Lanka, BRAC has also provided public entrepreneurial endeavours. BRAC’s steered the company to success. I thank LATRINESÖFORÖÙSHERMENÖINÖTHEÖPORTÖOFÖ4RICNO Ö local staff are women, employed the government and our development ÚOORÖMATSÖFORÖÚOODÖVICTIMSÖINÖ"ATTICOLA Ö from within the branch areas in which partners in Sri Lanka for their continued and sports and wet weather materials for they work, ensuring a truly contextual support as we strive to create greater school children in southern Sri Lanka. understanding of the challenges faced value in our services to contribute towards locally. The combination of all our efforts the progress and prosperity of Sri Lanka. In 2011, BRAC directed its efforts results in enhanced livelihoods of women to scaling up its services, opening across the country, in turn ensuring ÖNEWÖBRANCHESÖINÖÙVEÖDISTRICTSÖINÖ PROGRESSÖTOWARDSÖACHIEVINGÖTHEÖÙRSTÖANDÖ western, central, north central and third Millennium Development Goals, eastern provinces of Sri Lanka. We have eradicating extreme poverty and hunger organised 112,329 members, all women, and the empowerment of women. In the into 6,131 village organisations. Over coming year, BRAC hopes to continue 74,000 members (including 36,022 new its expansion to reach more of the most members) are actively borrowing and vulnerable women in rural Sri Lanka. more than USD 74.2 million has been disbursed to date. We provided holistic capacity development training to 177 members of staff. While our work in Sri Lanka started with disaster relief and rehabilitation following the Indian Ocean tsunami of 2004, by 2007 our focus had turned to longer term efforts in revitalising affected enterprises ANDÖECONOMIESÖTHROUGHÖMICROÙNANCEÖ With the end to three decades of armed CONÚICTÖINÖ Ö"2!#lSÖWORKÖINÖ3RIÖ,ANKAÖ aims to build livelihoods to help turn the peace dividends into a practical reality. 4 BRAC Annual Report 2011 BRAC Programmes Microfinance )NNOVATIVE ÖCLIENT FOCUSEDÖANDÖSUSTAINABLE ÖTHEÖ"2!#ÖMICROÙNANCEÖPROGRAMMEÖISÖAÖCRITICALÖCOMPONENTÖOFÖOURÖHOLISTICÖ approach to support livelihoods. Over the course of the last four decades, we have grown to become one of the WORLDlSÖLARGESTÖPROVIDERSÖOFÖÙNANCIALÖSERVICESÖTOÖTHEÖPOOR ÖPROVIDINGÖTOOLSÖWHICHÖMILLIONSÖCANÖUSEÖFORÖTHEÖBETTERMENTÖOFÖ their lives. Filling service gaps for the poor $ESPITEÖTHEÖSIGNIÙCANTÖSTEPSÖFORWARDÖSINCEÖTHEÖCIVILÖWARÖOFÙCIALLYÖENDEDÖINÖÖANDÖTHEÖ devastating impact of the 2004 Tsunami eased, it is estimated that 1.8 million people in Sri Lanka remain below the poverty line . Economic activity is concentrated in the prosperous western provinces, with huge income differentials in the eastern and inland RURALÖDISTRICTSÖ"2!#ÖAIMSÖTOÖÙLLÖTHEÖGAPSÖINÖÙNANCIALÖSERVICESÖACROSSÖTHEÖCOUNTRYÖANDÖTOÖ support its clients as they grow. Women attend a BRAC Village Organizations weekly collection meeting in Madapathana neighbourhood of Galle district. Sri Lanka. Microfinance BRAC Annual Report 2011 5 Our approach: 4UFQTUPXBSEÙOBODJBMJODMVTJPO #3"$mTNJDSPÙOBODF :4,SVHUZ programme reliably serves MYVT THPUZ[YLHT millions each year - a IHURZ rarity anywhere. Recent improvements in products 4PJYVLU[LYWYPZL and delivery mechanisms SVHUZ further allow BRAC to EFMJWFSCFUUFSÙOBODJBM services to the poor in the 4PJYVSVHUZ years to come. Gregory C. Chen ;HYNL[LKHZZL[ Regional Representative for South Asia NYHU[ZHUK Consultative Group to Assist the Poor ZVM[SVHUZ (CGAP) As depicted in the diagram, we address Serving women borrowers /URÖWOMENÖBORROWERSÖMUSTÖÙRSTÖORGANISEÖ THEÖSCARCITYÖOFÖÙNANCIALÖACCESSÖTOÖPOORÖ THEMSELVESÖINTOÖGROUPSÖOFÖÙVE ÖEACHÖWITHÖ women by providing them with