For socially and en committed entr vironmentally epreneurs and SM Es in the Middle Ea st & North Afric a
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Welcome
About Being a responsible business that has a positive impact on the community is no longer a do-good exercise for big corporations with deep pockets. We have designed this handbook for you, the smart entrepreneur, to show you how to build a thriving business around sustainable practices. Making sure your employees are happy, your products are environmentally friendly, and your customers are satisfied all add to you becoming an envied and successful player in the marketplace - someone who is here to stay. Being innovative by acting sustainable is about seeing opportunities first and about developing new products that people really need. It’s about thinking outside the box. It’s about making money, not giving away money. It’s simply good business. Together for a prosperous future This handbook is the result of a collaboration between international and local Egyptian actors to promote sustainable business as a tool for development in Egypt as well as the whole region of the Middle East and North Africa (MENA). We would like to express our gratitude to the German Government, which supported this handbook via the Deutsche Gesellschaft für International Zusammenarbeit (GIZ). giz.de 2
Further support If you need additional help with implementation of your sustainability activities, you can turn to the organisations who have published this handbook : Responsible and Inclusive Business Hub (ice_ribh): For sustainable development and innovation management, look no further than ice_ribh which powers a paradigm shift towards sustainable development in the MENA region. The hub is the GIZ focal point for responsible and inclusive business based at icecairo, a coworking and entrepreneurship space in downtown Cairo. The joint centre can assist you with both product and business-related issues of your good business journey. Feel free to also join the LinkedIn Group for our Sustainable Business Circle. icecairo.com Global Compact Network Egypt: The GCNE, Egypt’s premier sustainability and CSR hub, helps with CSR strategies for businesses of all sizes. As Egypt’s local network of the Global Compact, the GCNE experts can give you advice or organise a workshop for you. Meet us at the Egyptian Corporate Responsibility Center! ecrc.org.eg or unglobalcompact.org
Sustainable Start-Up Handbook
More brochures for start-ups similar to this one The Namibian Business and Innovation Center published various brochures on innovation, leadership and change management issuu.com/nbicnamibia
Contents
The journey begins here. Ahoy!
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Sustainable Business in a Nutshell 7 Glossary 8 Useful Links 9 Editorial
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Implementation Cycle: 14 Accept Responsibility 18 Know Your Impact 24 Think Long-Term 30 Walk the Talk 34 Talk Your Walk
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Egyptian Case Studies
Creative Commons We hope that you will use this document for your own business or as an inspiration for others. We would also like to encourage anyone working in the field of Responsible and Inclusive Business, entrepreneurship or innovation to create similar handbooks for your respective markets. This handbook may be reproduced for educational and non-commercial purposes provided the source is acknowledged. We strongly believe that companies of all sizes should and can make meaningful contributions to a better world. Feel free to share the handbook with fellow entrepreneurs and sustainability practitioners !
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Sustainable Start-Up Handbook
Sustainable Business in a Nutshell
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Sustainable Start-Up Handbook
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Sustainable Business in a nutshell
What, why and how What is sustainable business?
Why sustainability?
A start-up turns into a sustainable business when it is able to adapt to changes over time. It survives shocks because it is entirely connected to healthy economic, social and environmental systems. In this state, it creates economic value while contributing to maintaining natural ecosystems and to building strong communities. The aim is to meet the needs of today without limiting the ability of future generations to meet their own needs.
Businesses do not operate independently from their surroundings, rather they influence them in negative and positive ways. For example, by producing garbage in small to large quantities every day, Egyptian companies enlarge the dump sites, as well as pollute the air by moving material, products and people around. Of course firms have positive impacts, too, especially increasing the wealth of the society by providing jobs, and mandating upstream manufacturing.
Accordingly, sustainable business is about two things: a) what you do with your profits, b) how you make your profits. You might have noticed that the term sustainable business is often used interchangeably with corporate (social) responsibility, inclusive business, corporate citizenship, social business and triple bottom line. Though these terms are defined differently, they all point in the same direction: throughout the world there has been a sharp increase in the social roles businesses are expected to play in order to support government in the development of the country.
MAXimise CSR =
your positive impacts
Minimise
+
your negative Impacts
At the same time, society has also an impact on the private sector, just think of the shortage of skilled labour making human resources a critical issue, and high costs for logistics due to dense traffic. That means, if you want to run a successful business, you need to know your impact and develop mitigation strategies – that is what we call sustainable business practices. The idea of contributing to the welfare of those who are in need is not new but a longstanding and important aspect of Arab cultures. However, being a responsible com5
Sustainable Start-Up Handbook
i pany does in no way mean neglecting the business purpose of making profits. It is important that social or environmental initiatives result in a win-win situation, i.e., where the business benefits AND the society or environment benefits. Corporate Social Responsibility (CSR) is not only about charity, and it is definitely more than just complying with Egypt’s labour or environmental laws. The concept refers to how companies manage their financial, social and environmental impact and relationships with workers, customers, suppliers, communities and government. Consider the graph above: sustainable value is only created where society and business benefit equally. If only society benefits, then you are engaging in charitable projects, for example cash or in-kind donations without any expected returns. Vice versa, your highly branded sponsorships are public relations (PR) exercises, and important as these (golf) days may be, they have a limited positive impact on the wider society.
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>> Value creation with CSR Social benefit
Charity
Sustainable value creation
Compliance with legal obligations
PR
Business benefit
Sustainability makes business sense! Competitive advantage (product innovation, employee involvement and customer education) Cost reduction (e.g. energy, water and paper consumption) Relationship with unions, government, regulators Business reputation Ease of doing business in your community, city and country Staff and customer satisfaction Access to funds (investors)
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Sustainable Business in a nutshell
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Glossary Crowdfunding
Any individual can propose an idea that requires funding, and interested others can contribute funds to support the idea usually through online platforms.
Entrepreneur
A person who organizes and manages any business, usually with a pronounced attitude of taking considerable initiative and risk.
Good Governance
Being guided by human rights and by the principles of the rule of law and democracy, such as equal political participation for all, when operating as a business, organisation or country.
Inclusive Business
A company that integrates poor people into the value chain as consumers, producers, employees and/or business partners.
Shareholders vs. Stakeholders
A shareholder owns parts of a company, while a stakeholder has an interest in the company. (see page 18)
Social Business
A company that addresses social problems such as poverty by using methods of profit-driven businesses but reinvesting all profits into the business and thus increasing social impact.
Start-Up
A business that is in its early stage, i.e. in the phase of development and research for markets.
Sustainability
The potential for long-term maintenance of well-being in ecological, economic, and social dimensions.
Triple Bottom Line
The profit and loss account is expanded by people and planet, i.e. measuring the social and environmental impacts of a company.
Value Chain Analysis
Looking at every step a business goes through, from raw materials to the eventual end-user. 7
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Sustainable Business in a nutshell
Connect your business! Global and regional networks for business sustainability
The 10 Principles of the UN Global Compact
Accountability www.accountability.org Arabia CSR Network arabiacsrnetwork.com Corporate Register www.corporateregister.com CSCP www.scp-centre.org CSR for SMEs www.csr-in-smes.eu CSRwire www.csrwire.com Endeavor Egypt www.endeavoreg.org Egyptian Junior Business Association (EJB) www.ejb.org.eg Global Reporting Initiative www.globalreporting.org ISO 26000 www.iso.org Jeune Chambre Internationale www.jci.cc Morrocan CISE www.mcise.org United Nations Global Compact www.unglobalcompact.org WBCSD www.wbcsd.org
Human Rights 1: Businesses should support and respect the protection of internationally proclaimed human rights; and 2: make sure that they are not complicit in human rights abuses.
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Labour 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining; 4: the elimination of all forms of forced and compulsory labour; 5: the effective abolition of child labour; and 6: the elimination of discrimination in respect of employment and occupation. Environment 7: Businesses should support a precautionary approach to environmental challenges; 8: undertake initiatives to promote greater environmental responsibility; and 9: encourage the development and diffusion of environmentally friendly technologies. Anti-Corruption 10: Businesses should work against corruption in all its forms, including extortion and bribery.
Sustainable Start-Up Handbook
Behind the scenes
Editorial About the authors
About the graphic designers
This handbook is based upon the Handbook “CSR for Entrepreneurs” published by the Global Compact Network Namibia (GCNN). The Namibian version has been edited by the same authors as this handbook (see below) as well as Silke Feldmann, former GCNN project manager. Also to this edition, Akram Marwan, Global Compact Network Egypt officer, provided contacts and links to Egyptian actors in the field of sustainability and entrepreneurship.
The illustrations of Ahmed’s Oriental Kitchen were made by Natalie El Assiouty. The layout has been developed by Bernhard and Anita. Natalie designed the Arab version’s layout.
Anita Demuth Anita graduated in Economics and Political Science. She has gained professional experiences in media, international cooperation, and consulting, especially in the area of promoting sustainable economic development as well as of climate change and energy politics. demuth.anita@gmail.com
Bernhard Rohkemper As Coordinator of the ice_ribh, Bernhard assists the private sector in making a meaningful contribution to economic and social development. Before this he supported start-ups at the Namibia Business and Innovation Centre, and worked as a CSR strategy consultant for corporations in Europe.
Natalie El Assiouty Graduated in design, Natalie has specialized in product and graphic design in her professional and academic career. As project manager at ice_ribh she organizes workshops, and does the hub’s marketing and visual communication. natalie.elassiouty@giz.de
The Icons used in this booklet are from The Noun Project: thenounproject.com Special designer attribution: Announcement: Proletkult Arrow: Matt Scribner Bottle: Jakob Vogel Box: Travis J. Lee Checklist: Michael Young Cup: Brandon Hopkins DNA: Darrin Higgins Drafting: Jacob Eckert Sign Language: Jakob Vogel Earth: Francesco Paleari Feather: Plumer Firecracker: Max Becker Food: Rob Lavender Flash Cards: Rohan Gupta Jar: Gulio Bertolotti
Library: Plinio Fernandes Newspaper: Connie Shu Poster: Dima Yagnyuk Ribbon: Nathan Driskell Ship Wheel: Renar SC Stopwatch: Irit Barzily Sun: Adam Whitcroft Target: _Lo Team: Umbra2 Design Tree: Hernan D. Schlosman Tools : Dolly Vu Croissant: Nicolas Molès Satellite: Pedro Ramalho Carrot: Ricardo Moreira Shopping Bag: Ben Rex Furneaux
bernhard.rohkemper@giz.de
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Sustainable Start-Up Handbook
Implementation cycle
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Implementation cycle
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How to use this chapter From theory to implementation To give you the most practical lowdown on sustainability for your business, we have divided all implementation parts of this handbook into three areas. For each of the five steps to success, there are sections on theoretical background and tools, as well as examples from our fictitious case study. This is supplemented by a number of reallife examples from Egyptian companies at the end of the booklet. Foundations Although we obviously want to assist you in getting things done, a certain degree of theoretical background on business sustainability concepts will make implementation of your efforts much easier. Best practices for business sustainability are based upon the concept of Corporate Social Responsibility (CSR), for which reason we will use both terms interchangeably. We will introduce you to the reasoning behind the steps in the implementation cycle and what’s to be kept in mind.
Toolbox There are hundreds of tools out there to get your sustainability initiatives off the ground. We introduce you to the most helpful, easy-to-apply favourites from our extensive toolbox. Apply them and you will be through the first step of the implementation cycle in no time. They will certainly help you to run all aspects of your business more successfully. Ahmed‘s Oriental Kitchen To make the theory and tools presented in this handbook concrete, we have invented a fictitious start-up company, »Ahmed’s Oriental Kitchen«. Ahmed Rashid wants to open the small restaurant in Cairo soon. For years, he has been dreaming of having his own food place where people can mingle while enjoying Lebanese and Egyptian delicacies. His idea is to tweak very well known daily dishes by adding interesting ingredients, as well as revitalizing nearly forgotten traditional recipes. After having saved some money, he is ready to make his dream come true. Ahmed is thrilled to become his own boss and to invest his entrepreneurial energy in the development of Egypt towards economic growth, and social and political stability. 11
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Implementation cycle
5 steps to succes When embarking on a path of making your business more sustainable in an environmental, social and economic way, we suggest you follow five steps. How you want to approach each of these steps depends on
your business and your preferences. On the following pages you will find ample inspiration. However, we suggest you do the journey one step at a time.
Accept Responsibility Talk Your Walk Know Your Impact
Walk the Talk >> The implementation cycle 12
Sustainable Start-Up Handbook
Think Long-Term
Cowork at Egypt’s first Green Tech Hub At icecairo, a desk, fellow entrepreneurs and a fablab to produce green tech products wait for you! www.icecairo.com
1 - Accept responsibility First of all, it is important to accept the responsibility you have as a business for your employees, your community and the environment. Make sure everybody in your business knows what you stand for and that the entire team works together to make your CSR activities happen. This way, you will reach your goals much faster. 2 - Know your impact To improve what you do as a business, you first have to find out both the positive and the negative impacts your operations have on society and the environment. Knowing all these will enable you to plan the right activities in the next step.
4 - Walk the talk Now that all the rough planning is done, you can finally get going and implement your projects. Decide what exactly you want to do, by when it’s supposed to be done, how much money is available for it. And of course, who is responsible? Get your employees on board from day 1. 5 - Talk your walk Congratulations! Your first initiative for sustainability was a great success. Don’t be afraid to talk about it. It will make your employees proud and convince customers to come back for more of your products or services. Lastly, it will leave your competitors green with envy.
3 - Think long-term What direction will your efforts take? It’s wise to think about your vision and mission for sustainability and draw up a plan for whatever you intend to do. Become part of a recycling scheme, launch a green product, or do a staff volunteering day.
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Implementation cycle
1 - Accept responsibility Foundations Did you know that… ...in Egypt, well over 80 percent of the unemployed are below age 30, and 80 percent of the unemployed have never worked? ...MENA‘s population is projected to double over the next 40 years, whereas per capita water availability is said to fall by more than 50 percent by 2050? ...the Zabbaleen, traditional garbage collectors in Egypt are able to recycle nearly 85% of garbage, a diversion rate that is much higher than most cities in Europe? ...due to climate change, rising sea will probably swallow up low-lying coastal areas, deserts are expanding, and groundwater resources are drying up in MENA? These and many more national and global challenges are making it increasingly difficult for companies to continue growing while claiming their right to operate. Governments and societies are demanding that businesses start to account for their impact. Managers and entrepreneurs alike need to rethink business models as well as products, technologies and processes. You can choose to ignore the challenges that Egypt faces, or to accept the responsibility you have as a business person. This of 14
course doesn’t mean that you will have to take on the challenges all by yourself and fight a lonely battle. If every company keeps its own house in order and tries to become more sustainable, we’ve achieved a lot. For those that do it right, there is a world of business opportunities out there! By publicly announcing your commitment to keeping the environment and the people in your community in mind when making business decisions, you will generate a lot of goodwill from customers and employees. At the same time, they will of course also start to monitor whether you practice what you preach. This in turn will keep you and your team going to implement activities that put you on a path to becoming the good business you commit to be. After all, who wants to be associated with exploiting people, polluting the environment and supporting corruption?
Is sustainability a burden? Many entrepreneurs and even large companies believe sustainability is a burden on the bottom line. Is that true? For example, saving energy can lower your costs, and selling products that people really need will increase your revenues – it’s all about taking the right actions.
Sustainable Start-Up Handbook
Accelerate your technology start-up The Flat6Labs in Cairo and Jeddah offer funding, mentorship, training, perks, legal support and office space: www.flat6labs.com
Toolbox
Commit to the outside
So, how can you act? Start by accepting responsibility for your impacts. As a business owner, you should lead the process by committing the company and its resources to adhering to sustainability practices as a core component of your business strategy. That means, as a first step, you can commit to recycling, saving energy and water, anti-corruption, fair labour practices and respecting human rights. Become a Global Compact member As an advanced step, you can become a signatory of the United Nations Global Compact at www.unglobalcompact.org. In doing so, you commit to the organisation’s philosophy and the 10 principles in the areas of human rights, labour, environment and anti-corruption. To prove your commitment you would have to submit an annual Communication on Progress (CoP), i.e., writing a report on your sustainability activities. The Global Compact is the world‘s largest CSR network. If you prefer a more local approach towards the Global Compact, you can contact the Global Compact Network Egypt focal point via their website at www.ecrc.org.eg and get the opportunity to network with and learn from other sustainable businesses.
Put up a poster: Activate your creative self and design a poster that tells everyone what your start-up stands for. Fill it with your CSR promise or your company values, or draw a picture that shows your company and how it contributes to a better community and environment for all. Make an announcement: If you like it a bit more formal, put your commitment in a few wellformulated sentences. You can use those as first content for a section on sustainability on your website. And why not post the commitment on your Facebook page together with a fitting picture? Let your products speak: There’s a lot of printed matter you will produce at the start of your business. Use all those labels and flyers and business cards to renew your commitment again and again. Just include something along the lines of »Committed to Sustainability« on packages, on the bottom of letters and in your email signature to reach a high number of people out there.
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Commit to the inside Do a staff event: Launch your green commitment with a staff event. Invite your employees for a nice lunch at the local café and explain to them what sustainability means for your company and how each staff member can contribute. Get them excited about it. In the mug: Order a bunch of Egyptian-made mugs for your employees from the local pottery shop. Have your commitment to sustainability inscribed on the mug to remind the team of the common journey at all times.
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Identify champions: Identify su stain ab ility champ ion s amongst your staff members and encourage them to come up with new ideas. They can also help you to implement your activities once you have a clear plan.
Some examples of things you can commit to as a business:
Building a prosperous community. Promoting local trade. Employee well-being. Caring for the environment. Good governance principles. Providing safe products.
Sustainable Start-Up Handbook
A social business incubator Nahdet El Mahrousa is a hub for Egyptian young professionals, social change agents, and leaders in their fields. www.nahdetelmahrousa.org
Ahmed‘s Oriental Kitchen In a meeting with a bank clerk, Ahmed presents his business plan based on sustainable business practices. He targets fast growth of his business in the first year by getting things right from the get-go and creating a real buzz around his company by committing to sustainability. He plans to hire three more people by the end of the year. Because he would like to employ eco-friendly appliances and procedures he would need a bigger initial amount of financial means than with conventional equipment. But he is sure that the business would prosper in a highly competitive industry because the fresh food would convince customers at their first visit to come
again, while at the same time saving resources (and money) and creating jobs. He is able to convince the bank to give him a larger loan. During the course of preparations for the start of his business, Ahmed includes his commitment to sustainability in business cards, invitations to the launch event, and job advertisements. He puts up a poster in the restaurant. In addition, he becomes a member of the Global Compact Network Egypt. To prove his commitment to the Global Compact’s principles and to doing things differently right away, he decides to employ a female cook. Principle n°6 states that discrimination with respect to employment and occupation should be eliminated.
Ahmed decides to be a responsible entrepreneur. With his business he joins the Global Compact.
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Implementation cycle
2 - Know your impact Foundations As a business you are not acting in isolation. Everything you do has an impact on other people, be it your suppliers that depend on you, the customers you provide products to, or the people from your community that you employ. All those are referred to as your stakeholders, people or groups that are affected by what you do. Your impact on those relationships can be positive or negative. As a responsible business you want to make sure you maximise the benefits these people have from your business operations, while minimising the negative effects. Don’t forget, your business is equally shaped by your stakeholders’ actions. If they don’t agree with how you conduct business and work against you, you will have a hard time making your company a success story. Identifying and engaging relevant stakeholders is a challenge faced by many companies, from small enterprises to large corporations. Knowing your stakeholders and managing your relationship with them is critical for the credibility and growth of your business activities. To develop meaningful sustainability projects, you need to be aware of your impact on stakeholders.
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Some easy steps you can follow Step 1: Identify your stakeholders Think of your stakeholders in terms of workforce, market, community and government. The environment is considered a stakeholder too, as your business depends on it. Ask yourself one simple question: Whose lives do we touch through our operations or our products, now or in future? Here is a list of some possible stakeholders:
Workforce
Management, full-time staff, temporary staff, interns, students
Market
Current and future clients, suppliers, investors, competitors
Community
Families of employees, neighbourhood, media, NGOs
Government
Educational institutions, tries, public infrastructure
Environment
Wildlife, water, air, soil, natural resources
Sustainable Start-Up Handbook
minis-
A CSR smorgasbord The Guardian assembled case studies and dossiers around sustainable business on www.theguardian.com/sustainable-business
Step 2: Rank stakeholders As you will find out you have a large number of stakeholders, you will not be able to give equal attention. It’s important to identify the most relevant stakeholders. Which of the above stakeholders do you have the greatest responsibility towards? How dependent are they on your business or your products? Are they directly or indirectly impacted by your business and, in turn, how interested are they in what you do? Step 3: Capture your negative and positive impact on stakeholders Here you need to do some brainstorming with your team or ask stakeholders directly. Develop a table and then list all the good things you do. For example, as a business you create employment for people, you provide great products that make life easier and you are an active part of the local community. In addition to the sunny side of the business, also be honest about all the not-sogood impacts. Those are the things we like to ignore and sweep under the carpet, like the excessive amounts of water you use in production, the pollution it creates to transport your goods, and the unhealthy ingredients in your products that might cause obesity, addictions or even worse.
Step 4: Identify ways to increase positive and decrease negative effects Now comes the most exciting part of the exercise. Earmark the most promising areas of action you want to tackle first. Look at your positive effects and choose those, which you are most proud of and which have the highest impact. Talk about these successes and make sure more and more stakeholders can benefit in the future. Plus, don’t forget the potential positive effects you can have in the future with new ideas, products and processes. On the other hand, you need to identify the most damaging negative impacts to develop strategies to minimise or, even better, eliminate them. Otherwise they will haunt you later when you least expect it.
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Toolbox Don’t be scared! When it comes to engaging with your stakeholders to identify impacts you will most likely encounter some frustrated people that don’t like your business or its products. Be open to their suggestions and ideas, because you will only be able to become a more responsible business if you have people that are honest and tell you what they think. So, enjoy the good stories, but listen carefully when people approach you with criticism or new ideas. It might be an opportunity to create a new, better product or to improve customer experience. Identify and rank your stakeholders Before you talk about impacts on or by stakeholders, you have to get to grips with who your stakeholders are. Here are some simple tools to help you: Do a team brainstorm: Your employees are working with suppliers, customers and authorities all the time. They all have different stakeholders they deal with on a regular basis. If you take the time to sit with your team, you will develop a long list in no time. To structure the brainstorming, proceed group by group. First, capture internal 20
stakeholders, namely your employees themselves, then move on to capture other market-related stakeholders, then the community, etc. It will help to have a flip-chart at hand and ask someone to write down all stakeholders on a list as you engage in discussions. Read local papers: There might be people who have an interest in your business or feel affected by it, which you and your team are unaware of. It doesn’t even need to be connected to your particular company but could relate to your industry in general. For example, if an NGO expresses concerns that in Egypt, the agriculture and fishing industry make majority use of cheap and vulnerable child labour and you happen to be in the fishing industry, you should take this NGO very seriously as a stakeholder. By reading the papers and regularly checking the Internet you can monitor who says what about either you or your area of business. Make sure you include those people or organisations in your list of stakeholders immediately. Ask an industry expert: If you are lucky, you know someone with a lot of expertise in your area of business. Set up an informal meeting with that person to get his or her view
Sustainable Start-Up Handbook
Listen to the Green Prophet He will keep you up-to-date on green investment and growth in the MENA region. See yourself: www.greenprophet.com
on who is important as a stakeholder in the industry. If your network is not as established yet, you could also approach someone working at a local university in an area related to your business. If you want to open a guesthouse, why not talk to a lecturer at a hospitality school? There might even be research that you can tap into. Create a power-interest grid: Once you have an exhaustive stakeholder list, you can locate all your stakeholders in a powerinterest grid. Prepare this like in the illustration below, then decide for each stakeholder what their interest in your company is. If they are easily affected by what you do, place them high on the interest axis. The second dimension, power, is determined by how heavily the same stakeholder can impact your company. This way you will end up with a comprehensive overview of your stakeholders. Obviously, stakeholders with high power and high interest in your company should be your number one priority. Positive and negative impacts Read, ask, talk, listen. You can’t know all the impacts you have with your business. That’s why you need to be open to suggestions from your stakeholders.
>> Power-interest grid High Keep satisfied
Manage closely
Monitor
Keep informed
Power
Low
Low
Interest
High
Examine your value chain: Think about it, even if you produce a very simple product, this involves many steps and processes. Imagine your business at the centre and what operations take place there. Then add all things that happen before. Where do your supplies come from, how are they being transported, etc? Afterwards, list all the actions that take place after a product leaves your company. How does it reach customers? What happens during use of the product? You’ll find that your value chain is quite complex, meaning that with one single product you can have quite an impact, both positive and negative. Be honest and list ALL these impacts on ALL the different stakeholders at ALL stages of the value chain. Mark positive impacts with a green and negative ones with a red marker. 21
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Read CSR reports: It’s never wrong to check out what your competition does. Even better if it’s not direct competition from companies that are far away. The discussion around CSR and the impact of companies on society, the economy and the environment is a global one. Especially bigger companies from around the globe publish socalled CSR or Sustainability Reports on a regular basis. They are a great source of inspiration for smaller businesses. One of the world’s largest collections of CSR reports can be found free of charge at the Corp orate Regist er web sit e at www.corporateregister.com Do an online survey: Once you know all your stakeholders, you can compile a short survey to find out what they think are the most important issues your company should look into. There are easy-to-use online tools that allow you to create your free online survey in no time. Use your company’s Facebook page for a simple poll or try Google Documents (docs.google.com) or Survey Monkey (www.surveymonkey.com).
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Capture information: Make sure you capture all information gathered in a comprehensive table that you can use for further action and to develop your CSR activities. Here is one suggestion for such a table:
Stakeholder ...
Social Impact + ...
Ecological Impact
...
+ ...
Economic Impact
...
+ ...
...
Source from the crowd! As a smart entrepreneur you obviously see your stakeholders as an inexhaustible source of inspiration. Often they are the ones that provide you with much better ideas than those that you come up with by yourself. Don’t be afraid to ask them questions in person or via your Facebook page.
Sustainable Start-Up Handbook
Good and honest American apparel brand Patagonia is open about its successes as well as problems: www.patagonia.com/us/footprint
Ahmed‘s Oriental Kitchen As a next step, Ahmed would like to know who his stakeholders are to compile a guest list to the launch event. Together with a friend, who is a company owner himself, he arranges for a brainstorming session. They use the powerinterest grid for categorizing the stakeholders and decide the following: potential customers in the neighbourhood as well as suppliers of agricultural products should be managed closely; the commercial registration office and the bank should be kept satisfied; environmental NGOs and other potential customers should be kept satisfied; and competitors need to be monitored.
Through interviews with his potential neighbours and a lecturer at the nearby hospitality school, he discovers that he should keep a sharp eye on the source of fresh produce, on hygiene standards in food preparation as well as on waste management. The highest positive impact of the Oriental Kitchen could potentially be on job creation along the value chain. Besides the external stakeholders, he wants to do good to his internal stakeholders, his employees. Salma, the cook, has not gone through formal vocational training, but he knows from friends that her talent in the kitchen is extraordinary. In addition, he employs a young waiter, Karim. Ahmed will have to give him on-the-job training.
Ahmed‘s Oriental Kitchen staff Karim and Salma, as well as their customers belong to the stakeholders.
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Implementation cycle
3 - Think long-term Foundations Congratulations! By now, you should know your immediate impact on stakeholders. That means you can start thinking about projects that mitigate the negative and enhance the positive effects: your very specific sustainability projects that make sure your conduct does not compromise the well-being of current or future generations. This way, you will make sure that your business will be prosperous now and in the future. This is what we mean by thinking long-term.
>> Vision, mission & values Mission Ways to achieve your vision
Vision Your future purpose
Values Your guiding principles
your company assessment and make them your priority in whatever you do. Your journey takes shape! Instead of committing to sustainability in general, you can now develop a more pronounced plan, including vision and mission as well as values. Working together, your mission, vision and values can provide a powerful directional force to achieve a more sustainable way of doing business. Think about values that guide you along the way. Once your plan is ready and written, communicate it to your stakeholders, especially your investors, shareholders and (future) employees, to show them what they can expect from you in the future. A long-term sustainability vision represents your future purpose as a company, providing a mental picture of the goals that your business is working towards. Therefore, think about how Egypt can be enriched by your products and services in the future. As a further step, you should then think about your mission, which will state how you intend to achieve your vision.
In a world that is increasingly challenged by globalisation, resource scarcity, population growth, ecological decline, poverty and other challenges, you can play a vital role, even as a small business. All that it takes is to pick the worst and best impacts from 24
Sustainable Start-Up Handbook
United Nations Development Programme The nine ‘messages’ of the Egypt Human Development Report provide great input and ideas for your vision and mission: www.undp.org.eg
Toolbox You need to set aside some time to think about and define your long-term sustainability vision, mission and actions. It will surely pay off to take this time. It will make implementation of your actions much easier as everyone will know why you’ve come up with them in the first place and what they will contribute to the business itself. If you take it step by step, it will be done quicker than you think. Define your values First of all, make sure you know what your company's values are. They will tell everyone in your team how to behave when doing business. Distill personal values: An organisation is not an abstract entity but one that is defined and redefined by the people working for it on a daily basis. Especially in a small team like yours, the corporate culture and values that your business as a whole stands for, and is guided by, are determined by its people. Search the web for a list of values and hand it to each of your employees. Tell them to (anonymously) tick the five most important ones for them and hand it back to you. Combine them into a list with those values ticked most often on top. Once that is done,
invite your employees for a discussion to see if everyone can agree to these top 5 values as values for the company. Double-check values: Now that your team had its say, make sure the values identified go well with what you personally believe your business should be guided by. The new company values should never clash with your own values, because you as the boss will have to champion these values and make sure everyone adheres to them at all times. Plus, when thinking about your commitment to sustainability that started this whole process, your values should of course go well with your good business journey. Once satisfied, communicate your five or six company values to all stakeholders, especially employees. State your vision For your vision, imagine all the good about your company and try to combine it into one catchy sentence. If you think you can achieve the most for the world by focusing on going green, that’ll be part of your vision. If your stakeholder analysis has shown a beneficial social impact to be your strong point, let your vision mirror that. Remember, you have a lot of input to base your vision on already! 25
Sustainable Start-Up Handbook
Do the count: From your stakeholder analysis you have a long list of possible negative and positive impacts sorted into social, ecological and economic categories. Revisit that list and find out which of the three areas features the most entries. If people have a lot to say about your role regarding the environment, this could be a focus in your vision. If there are equal amounts of comments in two or all three areas, your vision can mirror that, too. Be inspired by other institutions: To get further inspiration beyond your stakeholder analysis, find out what your country’s national vision or development goal is, and in which areas your country cooperates with international organisations.
A good vision statement meets the following criteria:
Gives a picture of future purpose. Acts as a strategic guide. Activates imagination. Shows something desirable. Allows flexibility. Is easy to communicate.
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Think positive, and only positive: Now, with all the information gathered and direction given, try to think only in the most positive terms about your business. Even if stakeholders mainly mentioned negative things about you, think in reverse and find a way to turn your bad impacts into something positive. Formulate your vision to tell everyone the good you aspire to do. It could sound like this: »The vision of ... is to play a significant role in preserving Egypt’s natural resources through our production and products.« or »Our vision is to make a positive contribution to employment and social upliftment for the Egyptian people.« Decide on your mission Decide what’s key to work towards that vision. Think small steps. A vision is there to inspire, not to be made reality tomorrow. Your mission statement(s) will constantly remind you of your areas of engagement to become more sustainable. Revisit your stakeholder analysis: You can choose whether you’d like to have one mission statement that combines all your focus areas or whether you want several short statements with one focus area each. In any case, your mission should focus on what you
Sustainable Start-Up Handbook
Staff volunteering If you or your employees want to find a NGO to do pro-bono work for, register here: www.sharek.org
can do best and with most impact. If your vision is around social impact, have a look at this section of your stakeholder analysis table and, together with your team, pick the most promising areas. For example, to decrease unemployment, you can of course employ more people yourself. But maybe you can also encourage other entrepreneurs to use your products to create a business for themselves. To finalise, mould all focus areas into your mission. Here are two examples that go with the vision statements on the previous page: »Our mission is to reduce consumption of water and electricity in our operations, while at the same time providing products that can be fully recycled by customers.« Or »We provide affordable products for everyday Egyptians via a network of selfemployed sales people that bring our products closer to the people.« Compare to peers: When you and your team are satisfied with the mission and you feel that it goes well with and helps you to achieve your vision, check what other companies in your area have come up with. Just make sure your sustainability vision and mission didn’t ignore something very important to the industry.
Add actions To make your mission a meaningful one, it has to be accompanied by some real-world action. Take a look at your mission statement(s) and find out what you can do on the ground. Think outside the box: Now comes the creative part. There are numerous ways to make your mission work. Of all the hundreds of projects you can possibly conceive, you want those that have the biggest impact at the lowest cost. Even better, you want those that make money. Be innovative in your approach and don’t think along old lines and norms. Business as usual won’t help an awful lot with today’s challenges. A very helpful way to think outside the box is to involve people from different areas of expertise. For example, if you want to reduce water consumption, don’t only talk to an engineer. Also consult a teacher, a sociologist and a chef. They might have completely new ideas. Be open to ideas from everyone. We especially tend to ignore young people, people with lower education or at lower job levels. However, those are potentially your most powerful sources of ideas because they deal with the nitty-gritty all the time and have the real world experience. 27
Sustainable Start-Up Handbook
Do a World Café: For every focus area in your mission statement(s) try to identify one or two projects that you and your small team can implement over the next couple of months. For this purpose, get a good mix of people together. Your employees should be involved, but you can also ask some good friends, a family member or experts you know. Invite all of them for a so-called World Café. You can have a real coffee break with it. This is how it works:
>> World Café
Count your focus areas, for example water consumption, electricity consumption and recycling, and arrange as many tables in a room. Write each of your focus areas on a large piece of paper and put one on each table. Then distribute people among tables and ask them to come up with as many project ideas for the area as possible. Rotate after 15-20 minutes and repeat until everyone has worked on every area. Then review all project ideas and choose one or two very promising actions per topic.
Guests Area 1 Area 3 Area 2 Area 4
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Sustainable Start-Up Handbook
Ideas from millions of experts Seattle-based café chain Starbucks gives its customers a say. With amazing success: mystarbucksidea.force.com
Ahmed’s Oriental Kitchen Together with his staff Ahmed decides on the following values for the business: hospitality, professionalism, and reliability. For their vision they determine this statement: »Ahmed’s Oriental Kitchen restaurants all around Cairo will create better lives in a clean environment for the communities they operate in.« Once that is settled, they think about where they can have the biggest impact. That‘s why they decide the mission should be »We serve healthy, safe, and delicious food at reasonable prices, while creating job opportunities in Cairo as well as providing a clean and
pleasant environment for all.« Coming up with project ideas is easy now. As a first step, Ahmed wants to negotiate with his suppliers: he receives the freshest vegetables, dairy products and meat they can deliver, and in exchange he will pay above-average prices. Prepared food that hasn’t been sold by the end of the day and is still perfectly fit for consumption will be donated to poor people. Cairo’s informal garbage collectors, the Zabbaleen, who come by anyway, might be interested in taking the food for free for their families and the impoverished Zabbaleen communities.
Their vision statement: »Ahmed’s Oriental Kitchen restaurants all around Cairo will create better lives in a clean environment for the communities they operate in.«
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Implementation cycle
4 - Walk the talk Foundations As an entrepreneur you have accepted responsibility for your business impacts. You have also defined a sustainability vision, your mission and activities. Now it’s time to implement your plans, because a strategy or a vision, even a great one, does not implement itself – you need to walk your sustainability talk. Just in case you need some additional inspiration, here are a few suggestions for sustainable business activities listed per stakeholder group for easy reference:
Environment
Green products Water & energy efficiency Waste reduction Environment education
Employees
Better working conditions Improved work/life balance Creating a diverse team Staff volunteering
Community
Investments in infrastructure Education and training Job opportunities Affordable products
Market
Local sourcing Good supplier relations Anti-corruption Business alliances
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You can start with identifying some shortterm and some long-term goals to achieve the sustainability vision. Remember, goals should be SMART, i.e., Simple, Measurable, Achievable, Reliable and Time-bound. Implementation is about seeking better ways to align day-to-day operations with your specific CSR activities. To do this, you also need to evaluate the ability of each process, person or department. For example, to help the environment you can look at the product development, procurement and sales process – and identify opportunities for sustainability (waste management, client education, greener products, local sourcing). Some entrepreneurs may find it useful to manage their products’ environmental footprint. Others may need to provide additional benefits for workers, or they may want to work exclusively with suppliers that only employ workers of legal age. During the implementation phase, it is important that your business engages and empowers employees and business partners to execute the strategy and vision. As a leader, your »Sustainability mindset« needs to trickle down into all the operational processes. You need to develop a set of cultural beliefs about the importance of sustainability to the company’s long-term success. This can be enhanced by developing codes of conduct for your stakeholders.
Sustainable Start-Up Handbook
Financial support for technology start-ups Innoventures LLC. offers venture capital and business development support to Egyptian innovative businesses www.innoventures.me
Toolbox Before you jump straight into implementation, you need to follow key project management steps for successful execution of your sustainable startup strategy. Focus on a handful of projects you have identified to work towards your vision. Don’t overburden yourself with too much too soon. No matter what you choose to do, it is important to understand that all activities follow five basic processes. Initiation: Use your sustainability vision and mission to launch the first (few) project(s). If people understand how any given project helps to achieve your vision and mission, they have a sense of purpose and will be much more determined to make it happen. If you can’t lead the project yourself, pick one of your employees. Ask for volunteers among staff to find someone who is eager to work on your CSR project. Then communicate the launch of the project to the entire team so people know what’s going on and they can contribute according to their abilities. Planning: You (or the project manager in charge) have to generate a plan for the project in terms of what exactly you want to do/
change, who is part of the process, what budget is available, what timeline you are working with, and what has to be achieved in the end. Think of it as an action plan. This can be a simple table with columns showing task, responsible person, deadline and cost. Most importantly, all the people involved in the execution of the project will have to be part of the planning too. There’s nothing worse than other people making plans for you without actually asking first. The project manager has to get the team together on a regular basis to discuss necessary steps and make sure everybody knows what to do and when to have everything completed. By the way, don’t forget to establish what basis you are starting from. If you want to increase the amount of packaging you recycle, you have to know your current recycling rate to have a comparison at project end. Execution: This is the fun part! You roll up your sleeves, or »walk the talk«, and adjust your business so that you can reach your sustainability vision. As you progress with your first CSR project, you and your employees will see the impact bit by bit. That should keep you going throughout the implementation phase. Make sure you acknowledge and celebrate these little successes. 31
Sustainable Start-Up Handbook
Monitoring: This step is done in parallel to the other processes. It is where you are constantly checking to make sure whatever you do is in line with your original plan. If not, you will have to take action to get back on track. Meet with the implementation team on a regular basis to monitor progress and define new tasks when others can be ticked off. Once the project is fully implemented, a final evaluation is due. If you said you want to reduce your water consumption by 20% at the beginning of the project, you have to do the maths and find out if you did. Is your water bill really lower now than it was at project inception? Only then can you really say whether or not the project was a success and contributed towards achieving your vision. Closing: Time to celebrate! This is when you complete all the work of a certain project or after a time period previously set, tally up the total bill and sit back and enjoy the fruits of your (and your team’s) hard work. Well done!
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9 points to make your sustainability projects work: Plan properly! As Dwight D. Eisenhower once said, plans are worthless, but planning is everything. Manage your time! Make sure you get things started early so you don’t run into trouble later. Communicate! Listen to people and be open to what they say. At the same time share your ideas with others to get feedback. Don’t be afraid to ask! There are enough mentors and experts out there who are willing to share their ideas and help (free of charge). Lead by example! It’s your business and you are responsible for its success. You will have to make it work. Be determined! And ask others to do the same. Things will only happen if everyone pulls their weight. Take small steps! Projects can seem overwhelming. Chop them up into smaller tasks for ease of mind. Stay focused! Once you have decided on a project, stick to it and get it done. You can embark on more afterwards. Make an exit if need be! Don’t try forever if you know your project won’t work. Rather start a new one.
Sustainable Start-Up Handbook
Crowdfunding in the Arab world Let the crowd fund your sustainability projects! Present it on www.yomken.com or www.zoomaal.com
Ahmed’s Oriental Kitchen Ahmed’s targets of offering dishes at reasonable prices while at the same time paying in a fair manner for the best fresh ingredients to suppliers are a real challenge. To achieve both, the kitchen has to avoid food going to waste by planning preparation and sales very carefully. A week after the very successful opening party, the whole restaurant team comes together to work out a sustainability action plan. Everyone takes over at least one task including a budget. Salma will come up with a changing menu every week according to what’s in season. She will procure only the exact quantities needed for any given week. As business owner, Ahmed is going to negoti-
ate with the suppliers, while Karim is going to ask the garbage collectors if they are interested in picking up left-over food every evening, wrapped up in environmentalfriendly, reusable boxes. After one month, they have figured out food management procedures that reduce waste. Before they start to think about new projects, they analyze what went well and what did not go as expected. They realize that they did well in realizing their action plan, but that it’s a challenge to make customers understand that their sustainable business activities make them unique. Most people haven’t heard of the concept yet. Therefore, it’s time to invest time in communicating their concept and actions.
The restaurant team manages food and waste carefully.
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Implementation cycle
5 - Talk your walk Foundations During the past decade, »CSR expectations« from governments, NGOs and consumers have been on the increase, putting business under pressure to perform, not only financially, but also socially and environmentally, to think about a triple bottom line. Coupled with the technological impact, especially social media, it has become increasingly difficult for companies to hide their negative impacts, but also more easy to show their positive contributions. It has come to a point where stakeholder don’t want to be informed only by polished press releases any more. Stakeholders today are seeking greater transparency, organisational accountability and good governance – and this trend isn’t just for big businesses but includes SMEs through the supply chain. Therefore, business is shifting from: the shareholder to the stakeholder identifying to engaging with stakeholders informing to reporting Communicating your sustainability activities is key to your business success. Your customers want to know what you are doing. Consumers expect goods and services to reflect socially and environmentally responsible business behaviour at competitive prices. A good business reputation has a 34
significant impact on the brands customers choose. If organisations are to survive in the rapidly changing global environment, they must embrace and increase their communication. After all, if customers, employees and investors don’t have the necessary information to compare different companies and products, it is difficult for them to make the right choices. Help them to lead a more sustainable lifestyle by keeping them in the loop! Business communication can be classified into two types: internal and external. Internal documents circulate within the company. External documents are shared with stakeholders outside of the business. So, start talking about your CSR efforts!
Contents of sustainability reports An advanced step of your sustainability talk could be to report on your CSR efforts in a brochure. The following are typical chapters of CSR reports: Statement of principles and intent Identification of relevant sustainability dimensions Stakeholder mapping and engagement Discussion of activities Measurable results and statistics
Sustainable Start-Up Handbook
Getting the message across Try videos to communicate your CSR efforts. Start by watching this inspirational movie: »HOME« available for free on Youtube
Toolbox Here’s how you get the word out to your internal and external stakeholders. Internal communication In the modern business world, people communicate by text, phone, email, written correspondence and verbal communication. In effective communication, you must choose the communication method best suited for your staff. However, it is important to: announce your sustainability vision and implementation roadmap early on continuously update your staff on progress regarding sustainability activities encourage two-way communication and be open to feedback and ideas talk about challenges during the process, just as much as you celebrate milestones Here are some ideas for your internal communication with employees: Weekly Sustainability Tea: Informal gatherings are important in any company. This is where new ideas are born. Get your employees together for a weekly tea break to talk about CSR matters. Of course, you should serve organic tea to go with the theme. Or try locally roasted coffee and baklava.
Suggestion box: Sometimes people are afraid to talk about their ideas because they don’t know how they will be received. To gather those great ideas, put up a suggestion box in the office where everyone can drop project ideas anonymously. This way you can also gather feedback on completed projects. Let people have their say! Let them vote: Once a month, open the suggestion box and list all the ideas, however small or weird, on a wall poster. Then ask team members to (anonymously) vote for their favourite idea by sticking a red dot next to it. The project with the biggest support wins and can be implemented as the project of the month. External communication Communicating your CSR projects to your external stakeholders is very important. Part of your social engagement is because you want a good business reputation, which can give you a competitive advantage. On the other hand, you also want to tap into your stakeholders for new ideas. Therefore you need to let people know what you are doing well and what you are working on.
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Local media: You can easily create a little press release about your projects. Or you can place a small advertisement, emphasising your CSR commitment and/or project(s). During a staff volunteer activity or a cheque hand-over, you can take photos and send them to newspapers for publishing. Papers are always looking for a good story. Website: Creating a website these days is easy and inexpensive. You can use this platform to talk about sustainability efforts – and of course about your products and services, too. A very user -friendly and free online tool to build your own website is www.wordpress.org. If that still seems too difficult, you may want to start a blog to create some buzz around your company and latest developments. Check out www.blogger.com to create one. Social Media: If you are not part of the tweeting generation – no worries. Ask any one of your younger employees to set up an account and keep it updated. They’ll be thrilled to get an excuse to check out Twitter or Facebook as part of their job! Social media is on the rise and the next generation of clients will use it to check out your products as well as sustainability efforts. 36
Let your products speak for themselves: As a business you produce or sell products on a regular basis. Make use of them as a communication tool at no extra cost. You print labels for your products anyway, so you can include information on their positive ecological or social properties or your CSR activities on the back. Even if you sell services, the letters and documents you send out can contain little bits of extra information on your sustainability projects, as can your business cards and flyers. International reporting If you are more established in your sustainability activities, think about a proper sustainability report. It doesn’t have to be a lengthy book with dozens of pages. A small report in the form of a brochure could be a great start towards professional sustainability reporting. Thankfully, there are international guidelines you can use to structure your reporting activities. Each of these organisations has plenty of reporting tools available for both corporates and SMEs. If you are planning to grow internationally or work with big multinational corporations you’d better be comfortable preparing in-depth reports on your CSR. It’s the stuff that they look for when choosing new suppliers from abroad.
Sustainable Start-Up Handbook
Transparency: Let your products speak German fishmonger business “Followfish” allows customers to track products online with a code: www.followfish.de/en
UN Global Compact: The United Nations Global Compact is an international network and framework for sustainability management and CSR with a membership of about 7000 socially and environmentally conscious companies from around the world. The UN Global Compact also provides guidance if you’d like to report on your sustainability progress at www.unglobalcompact.org Global Reporting Initiative (GRI): This network-based organisation has produced and regularly updates a comprehensive sustainability reporting framework. It allows you to report according to your CSR maturity level and is therefore quite useful for small companies, too. All relevant documents, news on the latest trends in sustainability reporting and more information are available free of charge at the GRI website under the link www.globalreporting.org
Ahmed’s Oriental Kitchen Being proud of having succeeded in their first sustainability project, the restaurant team wants to tell its customers and its community about it. Karim is keen on setting up a Facebook page for the business. The first posts are about the high quality of their dishes, the management of food waste and a brief introduction into the concept of sustainability. Since all three team members write messages to their friends, customers, and business partners, one hundred people »like« Ahmed’s Oriental Kitchen profile after only one day. They have many more customers in the following week than ever before. Ahmed appoints Karim as communication manager to keep the Facebook page up-todate and bring up new communication ideas in the future. Apart from improving his social media skills, Karim gets a pay rise.
ISO 26000: The ISO 26000 standard provides harmonised, globally relevant guidance on social responsibility management for private and public sector organisations of all types. An overview is available free of charge, but the full document has to be bought at www.iso.org 37
Sustainable Start-Up Handbook
Egyptian Case Studies
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Sustainable Start-Up Handbook
Egyptian Case Studies
Oasis Renewable Energy
The business The company with 11 employees was founded by Egyptian professionals and engineering professors operating in the field of renewable energy in 2010. Its services include feasibility studies, construction, commissioning and operation of renewable energy installations as well as technical advisory services for small to large renewable energy projects.
The drivers Most of the existing available technology does not match the performance characteristics of the harsh environmental conditions in Egypt. The few technologies that would withstand the said conditions, are normally at price levels that are not affordable for SMEs in the agricultural sector, especially smallholders. Business owner Amr Farouk explains his motivation: “I prefer to support people to derive an income on their own over charity, even as the mentored entrepreneurs may actually be our competitors.�
The model Oasis supports micro enterprises to develop prototypes of small scale renewable energy The results installations for small farmers like 100 USCurrently, Oasis is contributing to 5 startDollar solar water heaters. Oasis provides ups, and aims at supporting 10 in total durinterim management, coaches staff, and ing the pilot phase. Parallel provides hands-on trainto the technical developing at the Oasis Commument of the prototypes, the nity Centre. Moreover, it development partner AWconnects the start-ups to TAD develops a capacity research centres and building and microfinance funds partially their capischeme for women in setal expenditure. The start lected villages. An aware-ups are all contributing ness campaign that aims at to the main stream busidisseminating knowledge ness of Oasis, by either about the benefits of reproviding products renewable energy is also unplacing export, or develderway. oping a product with a higher local content and amr@oasis-farouk.com lower budget. A US$100-wind turbine 39
Sustainable Start-Up Handbook
Egyptian Case Studies
Schaduf Urban Micro Farms
The business Schaduf Urban Micro Farms sells urban farming systems and offers a whole package of support to rooftop farmers: from the loan to invest into a tailored irrigation system to technical support up to marketing the fresh produce. Sherif and Tarek Hosny started the business two years ago. The brothers now employ 7 people. The model The model is an inclusive business model where low-income households are addressed as customers and producers at the same time. To increase commitment to rooftop-gardening, the installation of the irrigation system is not for free, but Schaduf connects the urban poor to organizations that manage micro finance funds. Besides, Schaduf trains their customers in micro farming, and provides services such as strategic market analysis and quality control. Five weeks after sowing, the crop is ready for harvesting. Schaduf buys the fresh produce from the urban farmers, re-sells them in big quantities to wholesalers or delivers them to customers via the Internet. Depending on the harvested quantities, the micro farmer receives EGP 100-300 per month starting from the second month.
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The drivers Since the 1950s, more and more Egyptian rural families have sold their modest parcels of agricultural land to move to the cities in the hope of getting a job in manufacturing. This decision has turned out to be a poverty trap for most people when they can’t find a job in the city. Furthermore, agricultural skills are being lost. Plus, the decrease in agricultural land leads to increasing food prices. The results After Schaduf successfully built several prototypes, the company started implementing its solution in low-income neighborhoods. One of Schaduf’s first customers managed to increase her income by 30% compared to her pre-gardening income. +201 0017 75224, tarek.hosny@schaduf.com
Sustainable Start-Up Handbook
Egyptian Case Studies
A.P.E.
The business A.P.E. stands for Association of for the Protection of the Environment. Legally an NGO, the social business helps Cairo’s garbage collectors, called the Zabbaleen, to recycle scrap and to compost organic waste. Rugs are woven and patchworks are sewn from fabric remnants, recovered paper is being recycled and re-used for paper crafts. The model Around 100 girls and women, all daughters of informal garbage collectors, work within the association in craftsmanship or administration, receiving a monthly salary. Another 300 girls and women sew clothing out of remnants in their homes. On behalf of them, A.P.E. markets the products in Egyptian shops, and occasionally abroad. Additionally, A.P.E. offers training in manufacturing, health care, and literacy programs for children and their mothers.
The drivers The Zabbal collects waste from each apartment on his route and then takes it home, where it is sorted into different types (plastic, glass, metal, etc.) and then sold to other families or companies that recycle it. The sorting work was traditionally done in the home by women and girls, resulting in high rates of diseases such as tetanus and hepatitis, as well as high rates of infant mortality. The aim of the social business is to help the traditionally marginalized group find innovative ways to support the environment and aid themselves. The results Through the many programs in 25 years of A.P.E., women have become empowered to build better lives for themselves and their families. Through comprehensive development, including health, education, social, economic and cultural programs, garbage collectors become agents of change for a better environment. People in the U.S. love A.P.E.’s products. A.P.E. sold its products of a value of $46.000 at the last Christmas fair in New York City. Fashion designer Marc Jacobs was inspired to include A.P.E.’s colourful bags in his stores worldwide and on his website. +202 2341 2723, info@ape.org.eg 41
Sustainable Start-Up Handbook
Egyptian Case Studies
Diwan Bookstore
The business Hind Wassef, Nihal Schawky, and Nadia Wassef introduced a new kind of bookstore in Egypt where people can buy books, films, music, magazines, stationery, or just have a cup of coffee in a relaxed and friendly place. Books are available in Arabic, English, German, and French. The first bookstore opened in 2002 with 15 employees. Today, the business operates with 145 employees. The model Diwan’s mission is to bring back a culture of reading to adults and children. By hosting events for local writers, providing workshops and lectures, screening the works of emerging artists and filmmakers, as well as promoting alternative and independent musicians, Diwan contributes to the revival and celebration of different aspects of Arab and Egyptian culture. The range of articles for kids does not only include entertainment but age-specific education and knowledge. Diwan is supporting NGOs actively in different fields of education, empowerment, and health by donating the proceeds of its Diwan Bag sales. It is also a consumer driven brand in the sense that it listens to what its customers want and try to act accordingly, e.g. when it comes to the introduction of new titles in Diwan. 42
The drivers As the three partners delved into the world of literature throughout their college years, they came across classic Arabic texts that were not being celebrated in mainstream studies. The first branch opened to revive and celebrate Arab and Egyptian culture, and to be an active platform of cultural interaction - bridging the boundaries between East and West. The results The business has been featured and widely acknowledged for its continuing impact in Time Magazine, The Bookseller, and The Wall Street Journal. The founders have received The Veuve-Clicquot Initiative for Economic Development 2011 for their efforts in creating a business that supports and develops cultural production and life in Egypt. +202 27546349, info@diwanegypt.com
Sustainable Start-Up Handbook
Egyptian Case Studies
The Bakery Shop
The business The three childhood friends Tarek El Nazer, Basel Mashhour and Sameh El Sadat started TBS - The Bakery Shop in 2008. Since then, TBS opened 13 local bakeries across Egypt that serve everything from bread to pastries, with the croissant in different varieties undoubtedly being their signature product. From 9 employees at the start, TBS grew to 260 within 5 years. The model TBS runs four different CSR projects. Besides sponsoring and a recycling project, TBS engaged into the political transition Egypt experiences. During the „Got Ink!“ campaign, all TBS branches offered free products to customers who had ink on their finger. A bright purple index finger served as proof that they cast their vote at the presidential elections in 2012. Furthermore, TBS managers mentor students on how to succeed in the private sector by participating in a business competition organized by the Egyptian NGO Injaz.
The drivers The “Got Ink!” campaign aimed at encouraging people to be part of the historic presidential elections in 2012. The founders wanted to get involved in the political transition without promoting one particular candidate for the elections. “We wanted to show that TBS believes in your vote”, says Basel Mashhour, one of the founders. The TBS founders do corporate volunteering because they are grateful for the past and on-going mentorship they received from their family and friends, as well as from business support institutions. The primary goal of the supported initiative Injaz is to make sure the leaders of today can create leaders for tomorrow. The results During the „Got Ink!“ campaign, TBS gave away almost 16,500 free products, resulting in much traffic in the shops. People did not only go for the free product but bought two or three more pieces. +202 2380 3339, basel.mashhour@ tbsegypt.com
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Sustainable Start-Up Handbook
Egyptian Case Studies
DCS Telecom
The business DCS Telecom is a service provider in the area of network and satellite telecommunications such as satellite internet (VSAT) and VoIP. The Egyptian-based company’s main customers are from the marine and petroleum industry. 13 years after founding the company, CEO Essam Khalil employs 50 people within Egypt. The company has an outreach to several African and Arab countries through small partners. The model DCS Telecom invites college students to work at its premises during the students’ summer break. The beneficiaries receive on -the-job training for 3 months and gain an insight into business with state-of-the-art technologies. In order to find applicants for this program and to to excite a bigger group of students about their industry, DCS Telecom holds presentations at public and private universities in Cairo.
The drivers Egyptian students hardly have the opportunity to gain professional experience at local companies, especially small ones. Internships as seen everywhere in Western countries and international corporations are not very common in Egyptian companies. In contrast, DCS Telecom does not only see the additional work in training the incoming students, but also appreciates their contributions. In the medium to long term, the business hopes to acquire former summer training students to join their team. The business expects to grow substantially in staff numbers under the condition that satellite communications will be the future first choice communications technology. The results During the 3 years of running the program, 20 students have been trained and one of them joined DCS Telecom after graduation. The staff has seen the students progress in committing to the rules of the workspace like being there on time and working 8 hours a day. DCS Telecom also joined the UN Global Compact to show their commitment. +202 4006 925, N.Mostafa@dcs-eg.com Photo: Mr. Kamalo, DCS employee and former intern
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Sustainable Start-Up Handbook
Egyptian Case Studies
RE: Genuine Plastic Bags
The business RE: Genuine Plastic Bags is a fashion line founded this year by two design graduates from Egypt, Yara Yassin and Rania Rafie. By ironing several layers of standard plastic bags together, they create a material that is water and sand-repellent. The final outcome are colorful handbags and purses as well as cell phone and tablet covers.
The model The two young designers started to upcycle plastic shopping bags during a semester at a university in Berlin. Upcycling is the process of converting waste materials into new functional material or products to prolong its lifetime. Since the graphical elements of their products depend on the available raw material, each design is only made once and thus serves as unique fashion item. Customers can also bring along their own old plastic
bags and Yara and Rania help them to preserve memories related to a certain bag. The drivers The two founders aim at raising awareness for the high quantities of plastic produced and used every day. “We have the bad habits of buying things all the time and using plastic shopping bags only once. Plus, God didn’t pack water into bottles!�, says Yara. These habits would harm the environment and unbalance our ecosystems: Huge amounts of plastics are eaten by fish and other animals and make their way into the human food-chain. Yara and Rania want to spread the idea of reusing materials and want to encourage the start of other upcycling projects in Egypt and the MENA. The results Prototypes of the bags are finished and durability tests showed positive results. A few bags have been sold in Germany and Egypt. As a next step, they are going to start an awareness and marketing campaign in hypermarkets. In the future, the two young business women want to teach the upcycling technique to Egyptian crafts women, so that they can produce the bags in a higher quantities. +201 0209 0063, re-order@live.com 45
Sustainable Start-Up Handbook
Egyptian Case Studies
WASLA
The business Wasla Outsourcing provides call center and technical support services, marketing research solutions, and outsourcing solutions. The company has 3250 employees in Egypt and Saudia Arabia. The company is a member of the UN Global Compact. The model The company’s approach to support the community is to integrate disabled individuals into its workspace. In cooperation with Al-Noor & Al-Amal Association, WASLA provides trainings and jobs for blind or partially sighted individuals in one of the call centers. Currently, there are 20 agents working for WASLA. There is no difference made in the wages between blind and non-blind staff, since both groups do their own special contributions to the business. The disabled staff inspires the rest of the employees and provides them with fresh ideas. To overcome particular barriers for the blind in their daily work, special support schemes like ongoing skills and knowledge trainings are in place. Besides this initiative, Wasla promotes entrepreneurship in partnership with the Information Technology Institute by enabling university graduates to start their own companies. Wasla and ITI supported graduates in establishing a first call center in Assiut. 46
Islamic leader Mostafa Hosny visiting blind call agents
The drivers Disabled persons face serious challenges in finding jobs. Assistance programs are often complicated and poorly coordinated, forcing individuals to piece together information and to develop work strategies on their own. Employers are often reluctant to hire the disabled, which can discourage them from looking for work. Wasla strives to help disabled individuals to get jobs. The results Hiring disabled persons gives Wasla access to a larger talent pool and exposes the company to new viewpoints that enables it to improve its service quality. These individuals have proven to be as highly skilled and efficient or even better as the fully sighted. +201 0083 66022, Saeed.reyad@wasla.com
Sustainable Start-Up Handbook
Egyptian Case Studies
Blue Moon
The business Global Compact member Blue Moon supports the fresh produce industry in MENA to meet legal and customer requirements of the European Union. Its services include capacity building and consulting, selfassessment and internal audits, second party audits, as well as an independent residue monitoring program. The model In a two-year project funded by USAID, Blue Moon trained small growers of Northern Egypt in earning the trust of the international fresh produce supply chain. The focus of the integrated capacity building program lay on the adherence to the requirements of GLOBALG.A.P. and FAIRTRADE standards as well as consumers’ expectations. The small growers also acquired skills in strategic planning and marketing agricultural products. Blue Moon planned and implemented the “Premium Project for Egyptian Small Growers” as well as provided training and consultation services. The drivers The challenge was “good practice” not “farming”. Egyptians have been growing fruits and vegetables for 7,000 years but they need guidance to meet international expectations. Blue Moon believes that by
helping Egyptian small growers meet the requirements of international standards, Egypt could potentially be one of the largest exporters of fresh produce around the world. The results In the fields, pollution has been reduced through collecting bags, personal hygiene has been increased through the provision of field toilets and hand washing facilities, and work safety has ben improved through protective clothes. A first UK-based trading company started to buy fresh produce from Egyptian small growers and a traceability system has been installed. Almost 1200 Egyptian small growers are now certified by GLOBALG.A.P. in Behera & Mersa Matrouh Governorates. +201 0698 1112, manal.saleh@bluemoon-eg.com 47
Sustainable Start-Up Handbook
HOW TO BUILD COMMUNITY TURN OFF YOUR TV LEAVE YOUR HOUSE KNOW YOUR NEIGHBOURS PLANT FLOWERS • GREET PEOPLE PLAY TOGETHER • LEND A HAND SUPPORT LOCAL BUSINESSES SHARE WHAT YOU HAVE • HONOUR ELDERS RESPECT YOUNGSTERS FIX IT EVEN IF YOU DIDN’T BREAK IT HAVE A BARBECUE TOGETHER • PICK UP LITTER SHARE YOUR SKILLS LISTEN TO THE BIRDS • PUT UP A SWING HELP CARRY SOMETHING HEAVY START A TRADITION • ASK A QUESTION ORGANISE A BLOCK PARTY BAKE EXTRA AND SHARE ASK FOR HELP WHEN YOU NEED IT SEEK TO UNDERSTAND Published in 2013 in Cairo by
32 Sabri Abou Alam First Floor, Apartment 8, Downtown, Cairo Egypt e bernhard.rohkemper@giz.de I icecairo.com
Egyptian Corporate Responsibility Center (ECRC) 9 Hayaat El Tadress Square Dokki, Cairo Egypt e amarwan@ecrc.org.eg i ecrc.org.eg