01
SUSTAINABLE EMEA ISSUE 01/19
B U S I N E S S
M A G A Z I N E
AFRICAN EDITION
COPPERBELT
ENERGY CORPORATION
PREMIER STEEL EDF RENEWABLES ECOM AGROINDUSTRIAL ALSO FEATURED THIS ISSUE IPP OFFICE • MILICON’S LIMITED • VODAFONE GHANA
S U S TA I N I N G T O M O R R O W. T O D AY
26 – 27 MARCH 2019 SANDTON CONVENTION CENTRE, JOHANNESBURG SOUTH AFRICA CO-LOCATED WITH:
UTILITY HOST:
AFRICA’S LARGEST POWER & ELECTRICITY SHOW 8000+ ATTENDEES, 800+ VIPS, 350+ EXHIBITORS 300+ SPEAKERS, 40+ AFRICAN COUNTRIES www.terrapinn.com/powerafrica
EXHIBIT NOW! Contact Sashnee Govender on +27 (0) 11 516 4065 or sashnee.govender@terrapinn.com
SUSTAINABLE
B U S I N E S S
M A G A Z I N E
Sustainable Business Magazine is committed to promoting sustainable printing. This magazine is printed on Forest Stewardship Council certified material and manufactured using environmentally sustainable procedures. All lithographic printer inks used are vegetable-based.
SBM Media Ltd - Henderson Business Centre, 51 Ivy Road, Norwich, Norfolk, NR5 8BF, United Kingdom • T: +44 (0)1603 516519 Email: info@sustainablebusinessmagazine.net www.sustainablebusinessmagazine.net
Editor: Senior Writer: Profile Writer: Contributors: Regional Managers: Business Development: Web Administrator:
George Newell Marcus Bonnano Liam Pritchett Susan Goldsworthy Natalia Olynec Jacob Hall Graeme Watts George Bell Ashley Hewitt
EUROPE / MIDDLE EAST / AFRICA
CONTENTS ISSUE 01/19
Welcome to the latest African edition of Sustainable Business Magazine. Sustainable Business Magazine aims to spread awareness of sustainable values in business, as well as the exciting ways in which organizations continue to meet challenges and champion corporate social responsibility. In this issue, we speak to some of the businesses and corporations who are driving economic growth, environmental stewardship, and empowering communities in Africa. We begin this issue with a conversation with Copperbelt Energy Corporation, a Zambian electricity company. We spoke to Mutale Mukuka, Chief Financial Officer, about developing sustainable electrical infrastructure, expanding internet access, and new opportunities in solar and hydroelectric energy generation. We continue our focus on green energy generation with a foreword from the Independent Power Producers Office (IPPO), followed by the latest installment in our IPP series, an interview with Kevin Minkoff, Head of Business Development at EDF Renewables South Africa. The company, formerly known as InnoWind, is responsible for more than 100MW of wind energy projects in the Eastern Cape, and is the hub for all EDF’s renewable energy projects in sub-Saharan Africa. In Kenya, we spoke to Nairobi-based construction company Milicon’s Limited about green building practices. Chief Technology Officer Rohan Parchuri told us about LEED-certified projects, the importance of producing construction materials in-house, and introducing Japanese efficiency methods to the Kenyan market. In a special focus on sustainable business in West Africa, we examine three key strands in the Ghanaian economy. First, we spoke to Arvinder Sethi, Director at Premier Steel, about major infrastructure works and the future of warehousing. We then take an in-depth look at Vodafone Ghana, and how better telecommunications allows businesses to grow and prosper. Finally, we spoke to Rahul Gopinath, Head of Africa – Cocoa and New Products at ECOM Agroindustrial, a major commodities trader, about developing West African farmers. We finish this issue with an editorial from Susan Goldsworthy and Natalia Olynec at IMD Business School on the need for business to respond to WWF’s Living Planet Report 2018, which warns of the ‘rapidly closing’ window to protect global wildlife. Details of upcoming sustainability events in Europe, the Middle East, and Africa throughout February, March, and April 2019 can be found on our events calendar. Our featured event is Power & Electricity World Africa 2019, Africa’s largest and longest-running power and electricity show, which will take place at the Sandton Convention Center in Johannesburg, South Africa, March 26-27 2019. We hope that you find this issue both interesting and inspiring. Thank you for reading. The Sustainable Business Magazine Team
02
Copperbelt Energy Corporation
08
Independent Power Producers Office (IPPO)
10
EDF Renewables
14
Milicon’s Limited
18
Premier Steel
24
Vodafone Ghana
28
ECOM Agroindustrial
34
IMD Business School
36
Global Events
37
Advertisers Index
IMAGE COURTESY OF COPPERBELT ENERGY CORP.
© SBM Media Ltd 2018. No part of this publication may be reproduced in any form for any purpose, other than short sections for the purpose of review, without prior consent of the publisher.
SUSTAINABLE BUSINESS MAGAZINE
|1
COPPERBELT ENERGY CORPORATION
CONNECTION THROUGH ENERGY
Sustainable Business Magazine speaks to Mutale Mukuka, Chief Financial Officer at Copperbelt Energy Corporation Plc, about accessible energy, sustainable growth, and facilitating the free flow of information across Central Africa. Copperbelt Energy Corporation Plc (CEC) is a Zambian electricity generation, transmission, distribution, and supply company. In 2017, CEC celebrated twenty years of successful operations after privatization, and among the many accolades the company received that year was the Environment Award by the Zambia Environmental Management Agency in recognition of their overall contribution to sustainable environmental practices. A major developer of energy infrastructure in Africa, CEC is respected for their skills in designing and operating transmission systems, and their particular dedication to enabling energy availability and accessibility for customers in Zambia and the DRC. “Our company first came into existence in the early fifties,” explains Mutale Mukuka, Chief Financial Officer at CEC. “We were initially established by mining companies who operated on the land between Zambia and
2 | SUSTAINABLE BUSINESS MAGAZINE
the DRC – the mining belt. They had a few coal power plants already to support their operations but came together to establish a streamlined energy business and the Rhodesia Congo Border Power Corporation came into being. It was later known as the Copperbelt Power Company, and, after independence, the company was nationalized and subsequently incorporated into the Zambia Consolidated Copper Mines (ZCCM), operating as the Power Division. This takes us to the late nineties, when CEC as we know it today was born out of the privatization of ZCCM. Since 2006, when CEC was bought by a group of Zambian-led investors, it has played a bigger role in Africa, venturing into different operations and looking into commercializing assets the Company already owned. Today, the business is the largest power trader in Southern Africa, our intention being to grow supplies
CEC IS RESPECTED FOR THEIR SKILLS IN DESIGNING AND OPERATING TRANSMISSION SYSTEMS.
SUSTAINABLE BUSINESS MAGAZINE
|3
COPPERBELT ENERGY CORPORATION
BY INNOVATING, BY INVESTING IN THE NEW AND CHANGING WITH THE TIMES, CEC HAS REACHED A STRONG POSITION MOVING FORWARD.
MR MUTALE MUKUKA CHIEF FINANCIAL OFFICER AT COPPERBELT ENERGY CORPORATION.
of power and infrastructure build in the DRC too, as we continue to see ourselves more involved with the mining operations there.” SUSTAINABLE INFRASTRUCTURE With a new century has come new challenges – and new opportunities. CEC is bent on growing the renewables share of their energy mix. “We recently commissioned a solar plant,” says Mr. Mukuka. “It is called the Riverside Solar PV Plant, near the Copperbelt University in Kitwe, and it’s a first for Zambia. It is 1MW, so it’s relatively small, but we are very excited about it because it will generate clean, reliable energy for Zam-
4 | SUSTAINABLE BUSINESS MAGAZINE
bians. Zambia is prone to power outages resulting from hydrological risks associated with the country’s current energy mix, which is dominated by hydropower. This prompted us to further explore solar and other renewable energy resources.” “An additional benefit of this project to the community and country is the component of training in the development and management of solar energy, both at professional and academic level,” adds Mr. Mukuka. “With our German partners, we have been able to introduce a new solar energy curriculum at one of the country’s top universities – the Copperbelt University. This means that we are able to train both our staff
ers in the region. We have realized that the biggest bottleneck in the transmission of power is actually getting the power to our customers, or in other words a question of accessibility. Hence, there are a number of infrastructure projects in the pipeline that we will continue to focus on in the months to come as we believe we have a significant role in creating infrastructure.” ACCESSIBLE ENERGY Zambia currently only has an electrification rate of around 30% nationwide, and access to electricity is vital to the Zambian government’s long-term economic development strategy, for both individual users and for businesses. “We have identified opportunities that are available to extend the transmis-
sion grid or even establish an isolated grid to help move forward in this area,” says Mr. Mukuka. “Some years ago, we extended our transmission to support a mine that was just a few kilometers on the DRC side. To do this, we had to have a line going up to the border, then a substation at the border and a direct line to that mine. Ultimately, anywhere where there is demand and the opportunity for growth we try to make investments, whether that is just increasing the transformer size so we are able to output more power to those areas or whether we are able to extend the line to provide power to new areas.” “CEC does not supply power to individual consumers or households,” says Mr. Mukuka. “Currently, the Company does not play in the retail space. However, in the
and students, thereby creating expertise and capacity available to the country at large. We also run a biodiesel refinery with a capacity of 900,000 litres per annum to produce an environmentally friendly and low-cost fuel as an alternative to fossil-based diesel.” Still on the development side, CEC has a hydroelectric project, scheduled for full construction commencement soon. The Kabompo Hydro Power Project will have a generation capacity of 40MW, with an annual energy output of about 166GWh. “This plant will have a stabilizing effect on the national grid,” says Mr. Mukuka. “We also plan to make further significant investments in transmission infrastructure for our customSUSTAINABLE BUSINESS MAGAZINE
|5
COPPERBELT ENERGY CORPORATION velopment including grid extension, hence access is not possible.” “We believe universal availability of power is not something that will come easily to our region, “ says Mr. Mukuka. “We need to recognize the affordability of effective tariffs. Solar technology, in particular, is becoming cheaper by the day, and is potentially a perfect solution for countries with low power accessibility. While we are mindful that this process will take some time, it is important to us that we are improving day by day and thinking about how we can facilitate effective, renewable, sustainable power for more people.”
spirit of public-private partnership, inventive mechanisms can be found for the state to leverage the financial ability of mining and other large industrial and commercial operations. For example, once power supply to a mining operation has been established
in a rural area, the grid can then be extended so that electricity access is available to schools, hospitals, and such social infrastructure in that area because households alone, especially rural consumers, lack the financial muscle to finance power infrastructure de-
Plot 1023, Eshowe Road, P.O. Box 22612, Kitwe
Tel: + 260 212 220432 • Fax: +260 212 220797 • Mobile: +260 974228077 + 260 950 228843 kitwe@eml-eis.com www.eml-eis.com
A worldwide leading supplier of pneumatic and electrical automation technology. Offering industrial and process automation, components and solutions.
DIVERSIFICATION & GROWTH In order to supply reliable electricity in the first place, CEC need to maintain the economic viability of their business through strategic growth. “As the saying goes, if you are not growing, you are dying,” says Mr. Mukuka. “We must ensure that we are constantly evolving and progressing via sustained growth. We have ensured growth the last few years by tapping into new markets consistently. Early on, we had the bulk of our income coming from just two custom-
TECHNICAL SPECIALISTS
Introducing the Fluke 279 FC Thermal Multimeter
The industry’s FIRST Thermal Multimeter! ONE WAY VALVE
LIMIT SWITCHES
QUICK EXHAUST
FITTINGS
TUBING
SERVICE UNIT
The 279 FC is a full-featured digital multimeter with integrated thermal imaging and is designed to increase your productivity and confidence. The thermal multimeter helps you find, repair, validate and report many electrical issues quickly so that your problems are solved.
Plot 195 Luanshya Road, East End, Off Great North Road, P.O. Box 31189 Tel + 260 211 227824-27 / +260 211 235366 • Mobile +260 9677311975 • Fax: +260 211 237014 / +260 211 226551 buying@eml-eis.com www.eml-eis.com
6 | SUSTAINABLE BUSINESS MAGAZINE
MWACHIMUKO Technical Enterprises Ltd T: +26 0966788384 E: mwachimuko@yahoo.com
IN ORDER TO SUPPLY RELIABLE ELECTRICITY IN THE FIRST PLACE, CEC NEED TO MAINTAIN THE ECONOMIC VIABILITY OF THEIR BUSINESS THROUGH STRATEGIC GROWTH.
ers. Through our expansion, we are slowly mitigating that risk, as well as ring-fencing investments to ensure secure business practices. Now we have over twenty customers and many of them are very good growth prospects. We also have a robust sourcing strategy and think carefully about how much power is self-generated, how much of it is coming in from the region, et cetera. We recognize that all players should benefit from a business and should get something out of their work, and key to this is the concept of sustainable growth.”
REGIONAL PROSPERITY By innovating, investing in the new and changing with the times, CEC has reached a strong position moving forward. “One specific instance of our approach to innovation is the company’s recently spun-off internet business.” says Mr. Mukuka. “When we started the business, as a joint venture investment, we were only making around one hundred thousand dollars per annum, whereas at the time we divested in October 2018, the business was worth over twenty million dollars. It’s a perfect example of sustainable growth.
www.mapaonga.com
Again, here, accessibility is really key. Our business is not just providing power to people, but by extension, we are also enabling auxiliary services that are made available by way of a functioning power supply system. This helps to improve production, which in turn improves the GDP of the country, positively impacting the economy and improving the quality of people’s life. Because we have run our business professionally, we have become attractive to investors and because of that there is a lot of interest in what we do and how we do it.” c
SIGNAL PROCUREMENT AND ENGINEERING LIMITED Electrical, Instrumentation, Civil and Mechanical Engineering • Electrical and instrumentation engineering services • General Building and Housing • Civil engineering • Mechanical spares • Steel Fabrication and Erection • Protective clothing equipments • Tubes & pipes •
Building, Civil and Mechanical Contractors with a Difference We provide construction, rehabilitation and maintenance services in a diverse array of works such as buildings, roads, bridges, culverts, mechanical works, and any other specialised construction works that may be specified by the Client.
No. 18 Mupundu Road, Northrise, NDOLA. P.O. Box 71309, NDOLA. Mobile: +260 955 411115 Tel/Fax: +260 212 611141 Email: info@mapaonga.com
SIGNAL PROCUREMENT AND ENGINEERING LIMITED No. 5 13th Street Nkana, Kitwe.
Cell: +260 977 593 914 / 955 593 91 Email: signal@zambia.co.zm signalprocurement@gmail.com
SUSTAINABLE BUSINESS MAGAZINE
|7
INDEPENDENT POWER PRODUCERS OFFICE
RENEWABLE
ENERGY ENSURES SA
REMAINS GREEN Renewable energy is fast changing the energy landscape of South Africa. Massive tall towers and thousands of shiny mirrors have suddenly appeared, as if from nowhere 8 | SUSTAINABLE BUSINESS MAGAZINE
– locals call the Solar Tower the “Star in the Sky”. Along the coast great white whirring blades of countless wind towers suddenly punctuate the horizon as far as you can see. Upstream, a river has been partially diverted to feed rushing water into huge turbines. Inland, thousands of blue solar panels stand upright in strict formation solemnly gazing at the burning Kalahari sun. Countless homes carry large tanks and black snake-like tubes on their roofs. What’s happening...a possible alien invasion? No! Hakuna matata (no worries). It is only South Africa’s renewable energy programme exerting its position on the energy mix of the country. South Africa has taken its rightful place amongst world leaders as a user of renewable energy. Global positioning with regards to reducing of carbon emissions has thrust South Africa into the realm of renewable clean energy. From rooftop solar water heaters to large concentrated solar power towers, the range is wide and growing even faster as gas and desalination projects climb into the game. Further technological advances such as Vertical Axis Wind Technology (VAWT) continue to stoke the fires of renewable energy research in the country. How did this all happen so quickly? The answer is very simple. It is what happens when good governance prevails. A simple agreement between the SA National Treasury, the Department of Energy and the Development Bank of Southern Africa saw the birth of renewable energy in SA and the Independent Power Producers Office (IPPO). The IPP Office is situated in Centurion in Pretoria and has become the home of renewable energy in SA. It was this group of smart young experts led by a legend in renewable energy in SA, Karén Breytenbach, bolstered by the presence and support of her COO, Maduna Ngobeni, a gentle giant in the field of renewable energy. Together they led the team to great heights when they produced the REIPPP, the Renewable Energy Independent Power Producers Programme, pronounced “reep”. This program has been lauded internationally and many countries
STUDENTS BUSY IN THE COMPUTER LABORATORY BUILT BY GOUDA WIND FARM.
COOKHOUSE WIND FARM IN THE EASTERN CAPE.
KONKOONSIES SOLAR PV IN THE NORTHERN CAPE.
have applied the REIPPP program in their own countries. Basically, the IPPO conducted auctions in which potential producers bid a price per megawatt that they were willing to sell at. The results were amazing. Based on 2016 Base Data, four bid windows saw the price of generated electricity for wind drop 50% between Bid Window 1 and Bid Window 4. Over the same period PV also fell 74% as newer and cheaper technology was introduced. Hydro electric, biogas, and biomass technologies have also been developed and are adding to the national grid. Furthermore R194bn has so far been invested by private and public sectors to make this happen. This is six times more than what was invested in stadiums in the 2010 World Cup in SA. Another amazing feature of the REIPPP is that successful firms had to commit 1 – 3% of direct turnover to social and enterprise development in the local communities surrounding the plant. This implies radical social and economic transformation as individuals, communities, and small businesses in rural, forgotten areas of our society benefitted from this new windfall. Like a windfall from heaven, IPPs have to date committed R20.6 billion towards socio-economic development initiatives in the country, with R16.5 billion thereof specifically allocated to their respective local community. Amazingly, operational IPPs have invested R504.9 million so far in innovative housing and infrastructure, health care, education, and skills development initiatives. As such, the direct impact of the programme on people’s lives is already tangible. Locals often comment, “We had nothing until the Plant came to the village”.
The unique and wonderful design of the REIPPP allows the programme to contribute to structural transformation in the economy and society by enabling broad-based participation by all South Africans. In Bid Window 4 South Africans own on average a 57.8% stake in the projects that have reached financial close and in Bid Window 3.5 a stake of 56% was reached. Furthermore, shareholding by South Africans is being secured across the value chain in operating companies of IPPs and in Engineering, Procurement, and Construction (EPC) contractors. On average, local communities co-own 11% of these projects. In addition, the IPPO mitigates against South Africa’s vulnerability to climate change. The renewable energy portfolio has reduced the country’s carbon footprint by displacing
22.5 million tons of CO2 emissions and with water savings of 26.6 million kilolitres. The environmental benefits of these clean energy resources will grow exponentially as the portfolio matures. Today 62 large renewable energy plants are connected to the national electricity grid with a total generation capacity of 3,773 MW. An additional two projects are still under construction under round 3 of the procurement program. A further 27 projects were signed on the 4 April 2018 with a generation capacity of about 2,300 MW. These projects are expected to start connecting to the grid towards the end of 2019 with the last connection in 2021. Finally, renewable energy has burst into our lives and the entire country stands to stay out of the dark. c MADUNA NGOBENI
KARÉN BREYTENBACH.
SUSTAINABLE BUSINESS MAGAZINE
|9
EDF RENEWABLES
RENEWING COMMUNITIES Sustainable Business Magazine speaks to Kevin Minkoff, Head of Business Development at EDF Renewables South Africa, about developing renewables projects in economically-deprived regions, community ownership, and the future of energy in sub-Saharan Africa.
WAAINEK WIND FARM.
EDF Renewables is a global leader in renewable energy generation. EDF Renewables has over 3,500 employees across around 20 countries throughout Europe, North America, Africa, the Middle East, Asia, and South America, with gross installed capacity of 14.2 GW. 81% of EDF Renewables’ development is mainly focused on onshore and offshore wind and solar photovoltaic power. The company is also actively developing energy storage, and solar distributed energy projects, as the renewables industry matures and new innovative technologies come online. EDF Renewables established a presence in South Africa in 2011, when the company took control of local project developer InnoWind, founded in 2008. Seven years later, EDF Renewables South Africa has not 10 | SUSTAINABLE BUSINESS MAGAZINE
only brought several South African projects online, totaling more than 100 MW of generation capacity across the country, but has also become the hub for the overall group’s renewable energy projects throughout sub-Saharan Africa. HOMELANDS DEVELOPMENT In South Africa, EDF Renewables currently operates three large active projects all located in the Eastern Cape. “We have over 107 MW in operation, between Grassridge, Chaba, and Waainek, all of which are wind farms,” explains Kevin Minkoff, Head of Business Development at EDF Renewables South Africa. “Earlier this year, we closed the finance on our fourth project, a 34 MW wind farm based in a rural area of the Eastern Cape. It’s called Wesley-Ciskei, and it’s the
first and only wind project under REIPPPP located in a former homeland region. It’s very important that this type of economic development is happening in an area that historically was deprived of such investments.” The ‘homelands’ were rural areas set aside by the apartheid-era South African government for various black ethnic groups, as part of an overall strategy to create a ‘white South Africa’. Between the 1960s and the 1980s, approximately 3.5 million black South Africans were forced to leave their homes in and around the cities to be moved to the ‘homelands’, where they were met with poor-quality housing and land unsuited to agriculture. Work in these areas was mainly restricted to the white-owned factories and mines bordering the ‘homelands’. These areas remain relatively poor, with high levels
AS EDF RENEWABLES MOVES FORWARD GLOBALLY, THE GROUP IS INVESTIGATING OPPORTUNITIES BEYOND WIND, IN EMERGING RENEWABLE TECHNOLOGIES.
of unemployment, though there are continued signs of economic regeneration. Construction on Wesley-Ciskei is expected to begin in October 2019, with energy production to begin before June 2021. Key to being awarded the project was EDF Renewables’ optimized approach, drawing on the institutional knowledge and resources from across the whole EDF Renewables Group. “We achieved a lot of optimization on the project design and engineering, which allowed it to be competitive against projects that were four times larger,” says Mr. Minkoff. “The placement of wind turbines is a great example. Modeling how the wind will flow through the entire project is something we can refine to the point where you have very high certainty about energy production.”
CHABA WIND FARM.
SUSTAINABLE BUSINESS MAGAZINE
| 11
EDF RENEWABLES GRASSRIDGE WIND FARM.
FRIENDS OF CHINSTA.
WESLEY-CISKEI LAND OWNERS.
COMMUNITY REWARDS All EDF Renewables projects in South Africa have a partial community ownership model, in addition to which a percentage of revenue is dedicated to enterprise and socio-economic development in the local region (a form of CSI). Once it comes online, Wesley-Ciskei will be no exception. “The local community always owns a percentage of the equity in the project company,” explains Mr. Minkoff. “For instance, in the Grassridge project, which is located just outside of Port Elizabeth, a community trust owns 26% of the project company’s equity.
The equity is held by a trust that administers dividends coming out of that project to fund community-based initiatives and social development in the area. We have a second scheme in place called Grassroots Youth Development that directs a portion of the wind farm’s turnover into community development programs. We’re looking at a 50 km radius around the wind farm, but mostly in the immediate area surrounding the township.” It’s an easily replicated model of community ownership that Wesley-Ciskei will bring to one of the country’s most economically
deprived areas. And given the bright longterm prospects for wind energy, Wesley-Ciskei is in line to have positive impacts for many years to come. “We’ve spent around 25 million Rand on the Grassroots Youth Development component alone since we started the program in 2015,” says Mr. Minkoff. “That’s across 43 projects, ranging from enterprise development, sports development, education, mental health support, and many others. Those have a very real impact from day one of the project becoming operational.” For the Wesley-Ciskei wind farm, EDF Renewables South Africa donated over
Assessing the impacts of development on the natural, social and economic environments through, among other instruments, the environmental impact assessment process, and in so doing contribute towards sustainable development. Contact: 67 African Street, Grahamstown, 6139 | Tel: +27 46 622 2364 | Fax:+27 46 622 6564 | Email: info@cesnet.co.za | www.cesnet.co.za
Branches: Grahamstown | Cape Town | East London | Johannesburg | Port Elizabeth | Maputo 12 | SUSTAINABLE BUSINESS MAGAZINE
LUNGISUPREME BRANDS.
FINGO ARTS FESTIVAL.
ZAR 20 million to the community owning the land so they could acquire a 5% equity stake in the project. Key to the success of this model is that the community component is deeply embedded in projects from the beginning. “A lot of the projects that we started developing in the earlier stages, we developed with the community component at the heart of it,” says Mr. Minkoff. “The two go hand in hand very well. It’s a very sound way of operating a business, whether a wind farm or a mining operation. If you look at successful mining operations in South Africa, mostly they have a very good community integration. This is true of Wesley-Ciskei. The entity that initiated the development of that project was a spin off from Oxfam, and its interests laid entirely in enacting community uplift. We believe in energy that benefits everybody. This new project has been about that from the beginning.” WESLEY-CISKEI. EDF RENEWABLES CEO.
21 ST CENTURY MODELS As EDF Renewables moves forward globally, it is investigating opportunities beyond wind, in emerging renewable technologies. “There are two big advancements at a EDF Group level this year in terms of strategic directions,” says Mr. Minkoff. “One is called the Solar Plan, and one is called the Storage Plan. The Solar Plan is aimed at developing and building 30 GWp of PV in France by 2035. The storage plan entails establishing 10 GW of storage globally by 2035, investing eight billion euros into that technology for that.” Meanwhile, in sub-Saharan Africa, EDF Renewables is growing throughout South Africa. “In sub-Saharan Africa, our future lies in a number of ventures,” explains Mr. Minkoff. “One of these is continuing to utilize the best of the projects we have. It’s mostly going to be driven by South Africa. I think what’s appearing more are tailor-made solutions with corporate, industrial, and
public partnerships. We’re moving a little bit away from the centralized model and more towards a 21st century decentralized, smaller, hybrid, more flexible type of solutions.” “This has been made possible by technological advances, definitely, but also contractual advancements and new financing models, that have enabled new types of agreements to occur too,” says Mr. Minkoff. “The entire range of products that go with a project that are now bankable on a smaller scale with operators that are not traditional utilities. The U.S. is leading that move. A lot of it has been driven by large global companies like Google, Facebook, and Amazon, that have pledged to become 100% renewable from their electricity supply. Those companies have driven the kind of contracts that we are now able to make use of. Going into the future this is only going to become more important, and we’re already perfectly placed to capitalize on this wave.” c
GRASSRIDGE WIND FARM.
SUSTAINABLE BUSINESS MAGAZINE
| 13
MILICON’S LIMITED
OVER THE PAST FEW YEARS, MILICON’S HAS TAKEN A SPECIAL INTEREST IN GREENER, MORE SUSTAINABLE METHODS OF CONSTRUCTION.
INVESTING IN MACHINERY Sustainable Business Magazine speaks with Rohan Parchuri, Chief Technical Officer at Milicon’s Limited, about a business model predicated on technology, working on green buildings, and providing sustainable incomes to local communities. Milicon’s Limited is a Nairobi-based Kenyan construction company with a difference. Founded in 1998, the company was created when Managing Director Sai Prasad Parchuri identified a gulf between the operating practices of Japanese construction companies and Kenyan construction companies. “Our Managing Director is an engineering graduate from India, who for many years worked for the Japanese company Sumitomo Construction,” says Rohan Parchuri, Chief Technical Officer at 14 | SUSTAINABLE BUSINESS MAGAZINE
Milicon’s Ltd. “He saw a gap that needed closing between the discipline and the emphasis on technology in the Japanese company and the way local Kenyan companies were operating. Since then, our main motto has been ‘Investing in Machinery’, which allows us to deliver customers the best efficiency and quality possible.” GREEN LEADERSHIP Over the past 20 years, Milicon’s has been involved in public works projects, such as
telecommunications buildings, educational institutions, and hospitals, as well as industrial projects such as building foundations for soda ash manufacturer Magadi Soda. Over the past few years, Milicon’s has taken a special interest in greener, more sustainable methods of construction. “We are currently building the Leadership Center at the College of Insurance, an institution that aims to develop business leaders for Kenya,” says Mr. Parchuri. “It is a hotel and green building which is already LEED-cer-
NACOSTI OFFICE BLOCK.
gy, and Innovation,” says Mr. Parchuri. “That had a similar methodology and processes to the Leadership Center, but at a smaller scale. The National Commission is about one-third of the total size of what we are doing with the Leadership Center, but the processes we followed such as concrete and steel re-use are very similar.”
PROPOSED LEADERSHIP CENTRE FOR COLLEGE OF INSURANCE.
tified. That means sustainability has been absolutely central to the project since day one. An example of this is the way we make use of waste concrete. We have a concrete workshop within the site itself where we can return waste pieces for re-use. Whatever remains we try to reuse or renew into other materials. We do the same with many of the other materials produced on site, such as waste timber or aggregate. Any waste water is recycled to improve the condition of the foundations and soil. Off-cuts from materials we don’t produce, like plastic, are sent back to the manufacturer to be recycled. Other things such as mechanical ventilation are kept to a minimum, so that energy usage is kept as low as possible.” This is the first time Milicon’s has worked on a LEED certified building but the company is already familiar with these kinds of sustainable practices. “Before this we did the National Commission for Science, Technolo-
GOVERNMENT PARTNERSHIP The company’s disciplined, process-oriented approach means they can achieve high-quality results even under challenging conditions. Between 2012 and 2015, Milicon’s worked on Kenya’s Senate Chambers, a very high profile and demanding job. “We did the complete Senate Chambers, meaning
a complete re-modification of the existing parliament and halls as well as the commissioners’ office block,” says Mr. Parchuri. “The project involved building an entirely new building as well as renovating existing ones. It was a major project logistically because of all the restrictions under which we had to work. Parliament was in operation, so we couldn’t disrupt their work with our project. That meant we could only work in areas when we were given the space to do so. There would be a window of 7 or 8 days, for example, when the national leaders were moving or parliament was closed. So that meant we had to move in very quickly, do all the things that were necessary, and get out again within this time. There were also
KIBABII UNIVERSITY - ADMIN. BLOCK.
SUSTAINABLE BUSINESS MAGAZINE
| 15
MILICON’S LIMITED
KIBABII UNIVERSITY - WATER TANK.
security concerns, which meant everyone had to gain approval before they could work on-site. In the end we had to work day and night to get it completed.” Ultimately, the success of this project led to Milicon’s winning a bid to build Kibabii University College from scratch, a project that was successfully completed in 2017. GROWTH FOR KENYA Milicon’s credit much of their success to their impressive ability to produce almost everything in-house and on-site. “Our main agenda was always to invest in machinery and technology,” explains Mr. Parchuri. “If you take the materials we use in construction, nearly everything is made on-site. Take concrete, for example. We have four batching plants ranging in size from 20 to 60 cubic meters per hour. We have a
16 | SUSTAINABLE BUSINESS MAGAZINE
plaster machine we bought from South Africa that we can take to sites, as well as block-making machines that allow us to produce our own blocks. We also have huge, modern machines for aluminum fabrication, timber works, et cetera. Our main motivation was always to do everything in-house. Because we can supervise everything ourselves that way, we can get far better results with greater efficiency.
NEW KITCHEN AND DINING AT KENYA NATIONAL ASSEMBLY.
KENYA NATIONAL ASSEMBLY DINING AREA.
OFFICE COMPLEX & HOSTEL BLOCK FOR NACOSTI.
That leads to better profits and we can spend more on our employees.” Spending on employees, for Milicon’s, involves hiring the best personnel, and
investing in local employment in and around the communities where projects are situated. “All of our senior employees are well experienced, often with many years in the area they’re working in,” says Mr. Parchuri. “They are skilled personnel that are essential for proper project management and operation of equipment. At every project site, we will also employ between 700 to 1000 local people, both skilled and unskilled, to ensure we deliver those projects successfully. If we are helping our employees, they are the ones who will support their local communities. From every project we have a separate budget
that we allot just for that local community. People we hire specifically for that job benefit financially and they can take those benefits back to their community.” “Because the motto we have placed for our company is actually helping us to grow and the local communities as well, we want to keep pursuing it,” says Mr. Parchuri. “Our major plans will be to grow and deliver quality projects, making sure that our brand name remains one of the best in Kenya. We will grow together with our company and the local communities around our projects, eventually bringing the whole of Kenyan society along with us. That is our dream.” c
KENYA NATIONAL ASSEMBLY PARKING AREA.
We provide Professional Services in General Building Construction, Civil, Mechanical, Electrical and Telecommunication Engineering We are a registered contractor with an experience of over 22 years in design, procurement of plant, supply, installation, testing and commissioning of HV, MV & LV Electrical power transmission and distribution systems including Airfield lighting systems, Airport Control and Air Navigation Facilities. Remote power solutions which comprise of Solar/Wind, Battery and Diesel Generators, CCTV, Access Control, Fire Alarm and Detection Systems, Structured Cabling/Telephony installation works, All-Dielectric Self- Supporting (ADSS) Fiber, Hybrid Fiber Cable (HFC), Gigabit-capable Passive Optical Network (GPON) system, Mechanical installation works and Maintenance of such system. Industrial Area, Off Mombasa Road | Postal Address: 61152 00200, Nairobi, Kenya | Tel: +254 (020) 2433595/6 (CDMA) : +254 722 209 634 /+254 735 337 767 | Fax: +254 (020) 24 33597 | Email : info@philafe.co.ke www.philafe.co.ke
SUSTAINABLE BUSINESS MAGAZINE
| 17
PREMIER STEEL
PREMIER STEEL HAS BEEN INVOLVED IN SOME OF THE COUNTRY’S MOST SIGNIFICANT INFRASTRUCTURE WORKS.
MATERIALS FOR GHANA’S GROWTH
Sustainable Business Magazine speaks to Arvinder Sethi, Director at Premier Steel, about working on major Ghanaian infrastructure projects, the future of warehousing, and participating in national growth. Premier Steel is a Ghanaian based construction materials wholesaler and retailer, with an extensive product portfolio ranging from iron and steel to paints and varnishes, protective and marine coatings, construction chemicals, and waterproofing, all sourced from reliable blue chip manufacturing companies. “Our mother company, Sethi Brothers, was estab18 | SUSTAINABLE BUSINESS MAGAZINE
lished in Liberia in 1975, which expanded to Togo in 1990 and Ghana in 1992,” explains Arvinder Sethi, Director at Premier Steel. “In 1997 I established Premier Steel Limited as a limited liability trading company. Today, in addition to the company headquarters in Accra, we have four distribution depots in Kumasi, Takoradi, Tema, and Tamale.”
INFRASTRUCTURE DEVELOPMENT As a key supplier to Ghana’s construction industry, Premier Steel has been involved in some of the country’s most significant infrastructure works, supplying quality construction materials and coatings from leading global manufacturers, including Master Builders Solutions, PPG Protective
PROJECT: TAKORADI PORT EXPANSION PROJECT. CONTRACTOR: JAN DE NUL.
PROJECT: GHANA AIRPORT CARGO CENTER. CONTRACTOR: ENERGOPROJEKT.
and Marine Coatings, Pittsburgh Paints, Berger Paints, Renner Sayerlack, Solignum, and Condor. The Kwame Nkrumah Interchange, a road interchange in the center of Accra, was a major project for Brazilian contractor Queiroz Galvão. Premier Steel supplied all of the concrete admixtures and epoxy coatings for the project, as well as some of the steel and iron rods. “We also were involved in supplying curing compounds and release agents for the acropods being built for the Tema Port Expansion project,” says Mr. Sethi.
“At the Takoradi Port Expansion, we are supplying admixtures for the quay blocks. We are supplying grouts and epoxy flooring to the Aksa and Amanadi Power projects, to be used for their generators and floors. And we supplied protective and marine coatings (PMC) and steel to the Kpone Power project and TICO project. Construction chemicals were supplied to the new Kotoka International Airport Terminal 3 project, concrete admixtures to the Kejetia Central Market project in Kumasi, and epoxy flooring to the Ghana Airport Cargo Center.”
PROJECT: AKSA ENERGY. CONTRACTOR: AKSA.
SUSTAINABLE BUSINESS MAGAZINE
| 19
PREMIER STEEL ARVINDER SETHI, DIRECTOR AT PREMIER STEEL.
In developing countries like Ghana, infrastructure projects can have an outsize impact on economic growth – and social transformation. “The Kwame Nkrumah Interchange relieves a lot of traffic congestion on the arterial ring road in the capital Accra,” says Mr. Sethi. “As a result, the commuting times of many people have been drastically reduced. The Takoradi Port and Tema Port expansion projects have helped many more vessels dock. There are quicker turnaround times, meaning more cargo arriving. The Takoradi Port is particularly important as it’s where all of Ghana’s oil, minerals and wood is exported from. This expansion has really 20 | SUSTAINABLE BUSINESS MAGAZINE
helped them become more efficient. With the power projects, we had a shortage of electricity in Ghana. Now we actually have a surplus. And the new Ghana Airport Cargo Center is a world class cargo center that the country previously never had, which makes clearing procedures more efficient and quicker at the airport.” Premier Steel also provide some materials free of charge to deserving organizations. “We sometimes have paints which have damaged packaging, so though the paint is perfectly useable, it’s not feasible for sale,” explains Mr. Sethi. “We donate these paints to local orphanages, for their own use. We
also assist the local police station with building materials for their renovations. We do what we can to practically support our local communities with our materials.” BEST STORAGE POSSIBLE Next, Premier Steel intend to begin introducing automation to their warehousing. “Our vision is to be one of the leading building and construction material distributors in Ghana,” says Mr. Sethi. “To do this, we need to run a sustainable, automated, efficient business model. It can be very hard to find the right employees in Ghana. Putting the right team together is difficult be-
PPG PITTSBURGH PAINTS. It’s all you need when you think about painting.
Accra: +233.26.7555253 | +233.26.7555255 Tema: +233.26.7555254 | +233.26.7555265 Kumasi: +233.24.331675 Takoradi: +233.24.4403441 asethi@pslgh.com | haresh@pslgh.com SUSTAINABLE BUSINESS MAGAZINE
| 21
PREMIER STEEL PROJECT: ABOADZE THERMAL PLANT. CONTRACTOR: METKA.
PROJECT: GOLD COAST REFINERY. CONTRACTOR: KELM GH / WARE LTD.
22 | SUSTAINABLE BUSINESS MAGAZINE
cause staff are often very transient. This is a problem across all companies – many of us are just stealing the good employees from each other at this point. So we are looking at setting up a fully automated warehouse that will be able to provide efficient service and accurate information. Some of our European distributors have this, and we’re modeling ourselves on that. It could take some time before that’s possible, but in our view, this is the way to improve efficiencies and improve costs.” For now, Premier Steel is proud to operate high-quality manned warehouses. “We use technology to ensure our buildings provide the best storage possible,” says Mr. Sethi. “This includes temperature control and air conditioning for stored materials, a rigorous cleaning schedule, and making sure the inside of the warehouse isn’t exposed to
PROJECT: NEWREST ACCRA CONTRACTOR: WARE LTD.
PROJECT: ECOBANK HO. CONTRACTOR: ENERGOPROJEKT.
PROJECT: KEJETIA CENTRAL MARKET. CONTRACTOR: CONTRACTA.
PROJECT: A1 RACEWAY. CONTRACTOR: DEVTRACO LTD.
direct sunlight. We operate a system of firstin, first-out to make sure no products get left behind. Our manufacturing partners also retain batch samples of every product sold for warranty and testing purposes against defective materials.”
Mr. Sethi is hopeful about the future of Ghana. “We’re doing pretty well over here in Ghana,” says Mr. Sethi. “It’s a politically stable environment. We have economic stability and security. There’s no shortage of electricity. The country currently has a 6-7%
growth rate. Things are looking good in terms of the other West African states. We’re proud to be participating in the development of this wonderful country, and we believe our business will continue growing alongside it.” c
GROWING FOR GHANA As Premier Steel pursue their long-term goal of further automating their warehouses, they will continue centering themselves in the Ghanaian construction supply chain. “The plan is to maintain our position and to increase our market share,” says Mr. Sethi. “Premier Steel will take things one step at a time. It’s an informal market here in Ghana. Most construction projects here are ad hoc and unorganised. Not many things are planned. So we just have to do our best and know what’s happening.” SUSTAINABLE BUSINESS MAGAZINE
| 23
VODAFONE GHANA
24 | SUSTAINABLE BUSINESS MAGAZINE
CONNECTIONS
Sustainable Business Magazine takes an in-depth look at Vodafone Ghana, and how the company is investing in 4G technology, healthcare, and improved education. Ghana was one of the first African countries to move from a government-controlled telecommunications market to a liberalized market. Today, the number of Ghanaians with mobile phones has reached an all-time high, with the Jumia Annual Mobile Report estimating that by 2020 there will be 40 million mobile phone subscribers in the country, representing 130% penetration. What’s more, 10.11 million Ghanaians – over half the population – have internet access, with the number growing every year. Ghana Telecom, the state-owned telecommunications provider, was privatized in 1996. In 2008, Vodafone Group Plc acquired a 70% stake in Ghana Telecom for US$900 million, forming a new company called Vodafone Ghana, with the government owning the remaining 30%. At the time, Arun Sarin, CEO of Vodafone, said in a statement: “Ghana is one of the most attractive markets in Africa, with mobile subscribers growing at more than 55% p.a. and mobile penetration around 35%. Our extensive operating experience together with our portfolio of products and services position us well to deliver a superior mobile experience to Ghanaian customers and significantly improve financial performance. I expect that our investment will generate substantial benefits for Vodafone and for the Ghanaian economy and
we are delighted that we will be working in partnership with the Government of Ghana.” Today, Vodafone Ghana is one of the largest telecommunications providers in the country, supplying mobile, fixed lines, internet, voice, and data. The company has consistently won awards for service and CSR activities, including CIMG Telecommunications Company of the Year and CSR Telecom Company of the Year. Now, Vodafone Ghana is bringing faster, reliable internet access to even more Ghanaian users, with their announcement in January that they would begin deploying 4G technology to customers in April 2019. 4G FOR THE FUTURE After the National Communication Authority (NCA) published a Request for Applications in late 2018, Vodafone Ghana won one of three lots of 2x5 MHz frequency spectrum blocks in the 800 MHz band. They were the only company to successfully apply for the 4G license. The bidding document required any company which won a bid to make 25% of its shares publicly available on the Ghana Stock Exchange – a clause Vodafone Ghana already exceeds, as 30% of the company’s shares are publicly-owned. Now, Vodafone Ghana is restructuring their infrastructure to prepare for 4G de-
ployment in the second quarter of 2019. In a statement, Yolanda Cuba, CEO of Vodafone Ghana said: “We are excited that, after three years of persistent constructive engagement with the regulator and policymakers, we now have the opportunity to operate an LTE 4G license in Ghana. We are happy that our customers will finally experience faster data speed. Vodafone is committed to continuously working with the regulator to promote digital inclusion in the country, for which the 4G spectrum will play a critical role. It will also enable Vodafone to work with government on its agenda of digitizing Ghana’s economy.” Ms. Cuba also said: “I would like to thank our shareholders – the government of Ghana which has 30 per cent shares, and Vodafone Group with 70 per cent shares in Vodafone Ghana – for their commitment to our operations, and their support in our quest to deploy 4G in Ghana. With such strong partnership between our shareholders, Vodafone Ghana is optimistic of a great future for our customers and the country”. DRIVING SUSTAINABLE DEVELOPMENT Globally, Vodafone Group’s sustainable business strategy targets three focus areas: Women’s empowerment, with 2025 goals to connect an addition 50 million women
SUSTAINABLE BUSINESS MAGAZINE
| 25
VODAFONE GHANA
We are fleet Management
We’ve got you covered
Leasafric provides leasing and ancillary services to its cherished clients with the view to adding value to its client’s services and operations. Our services include: • Operating Lease/Fleet Management • Finance Lease • Staff Busing • Switch Car Rental • Staff Outsourcing • Tracking Services t: 030 278 0901-3 / 050 128 2269 e: info@leasafric.com.gh | w: www.switchcarrentals.com.gh mobile app: Switch Car Rentals
RPS Engineering Services Ltd
Service. Integrity. Fortitude. RPS Engineering Services Ltd is a wholly Ghanaian owned professional company supporting Cellular, Telecommunications, Broadcast and similar operations with infrastructure implementation and maintenance services of the highest international standards. RPS Engineering currently offers endto-end turnkey cellular network infrastructure solutions to leading Telecom operators and infrastructure support companies in Ghana.
RPS Engineering Services Limited - #20 Apple Street, Otinshi, East Legon, Accra O: +233 302520271 | C: +233 244809999 | ooduro@rpsengineeringservices.com
www.rpsengineeringservices.com 26 | SUSTAINABLE BUSINESS MAGAZINE
living in emerging markets to mobile and for Vodafone to become the ‘world’s best employer for women’; energy innovation, with 2025 goals to reduce greenhouse gas emissions by 40% and to purchase 100% of electricity used from renewable sources; and youth skills and jobs, with 2025 goals to support 10 million young people to access digital skills, learning, and employment opportunities, and to provide up to 100,000 young people with a digital workplace experience at Vodafone. At a local level, Vodafone Ghana are known for their philanthropic contributions to the wider Ghanaian community. The Vodafone Ghana Foundation was launched in 2009, shortly after Vodafone’s initial entry into Ghana. The Foundation supports social initiatives, particularly those involving technology and telecommunications. The Foundation’s vision is: ‘To be regarded as the most caring Telco brand in Ghana, by empowering and giving access to tools and facilities that support sustainable social change.’ The Instant Schools program, deployed alongside the Ministry of Education and local educational institutions, provides free access to online learning materials from primary to secondary level, provided by Khan Academy. This content is accessible by mo-
bile phones, in order to reach children who don’t have access to regular schools, and is free to Vodafone Ghana subscribers, who are not charged for data usage. The content is tailored for local students. The pioneering Vodafone Ghana Foundation Scholarship Scheme aims to increase women’s engagement in science and technology by identifying 100 girls per year with low financial resources but high grades to study math, science, and technology courses in senior high schools in Ghana, and supporting ten women to study at the University of Education Winneba. Another Foundation-supported project is the television show ‘Healthline’, which for seven years has brought free surgeries to individual Ghanaians while inviting viewers to take a greater interest in healthcare. Meanwhile, ‘Healthline 255’, a medical phone service, has given thousands of individuals education on health conditions and first aid advice, the majority of calls coming from rural areas with limited access to healthcare. RECOGNITION FOR EXCELLENCE In recent years, Vodafone Ghana has received a multitude of CSR awards. In 2017, the company was awarded CSR
Telecom Company of the Year and Best CSR for Health at the CSR Excellence Awards in Accra. At the time, Ebenezer Amankwah, Corporate Relations Manager, said: “At Vodafone, we believe technology can be used to drive social good and this is part of our ethos in all the markets where we operate. Our approach to CSR is unique and this is what distinguishes us from the rest. We still believe there’s a lot that can be done and we will continue to champion sustainable initiatives that will complement government’s efforts towards achieving the Sustainable Development Goal (SDGs).” In November 2018, Vodafone Ghana received the CSR Award for Education and CSR CEO of the Year for CEO Yolanda Cuba. In a statement, Ms. Cuba said: “This is a true reflection of the concerted effort we put in to impact lives in Ghana. I dedicate this award to the staff of Vodafone Ghana and the Foundation for a job well done. We have a duty to do good as a multinational company operating in Ghana. It is part of our ethos in all the markets where we are visible. Over the years, we have made efforts to promote initiatives that benefit society, because we are committed to the communities in which our employees live and work.” c SUSTAINABLE BUSINESS MAGAZINE
| 27
ECOM AGROINDUSTRIAL
ECOM HAS BEGUN TO SHOW WHAT A FUTURE COMMODITIES TRADING INDUSTRY COULD LOOK LIKE.
RETHINKING
COMMODITIES TRADING Sustainable Business Magazine speaks to Rahul Gopinath, Head of Africa – Cocoa and New Products at ECOM Agroindustrial, about working with West African farmers to develop better products and sustainable, lasting prosperity.
28 | SUSTAINABLE BUSINESS MAGAZINE
ECOM Agroindustrial is a multinational commodities trading company which handles four product streams – cocoa, coffee, cotton, and sugar. Founded in 1849 by José Esteve, a Spanish cotton trader, the company remains majority-owned by the Esteve family. Today, ECOM operates in over 40 producing countries, and the company is the largest coffee miller in the world, as well as among the top four merchants globally in cotton and cocoa. In West Africa, ECOM primarily deals in cocoa, cashews, edible nuts, and spices, particularly in Ghana, Côte d’Ivoire, Nigeria, and Guinea-Bissau, working with some of the world’s poorest farmers. With a long heritage, ECOM has a depth of experience to draw upon, and a perspective which prioritizes longevity and long-term sustainability over the immediate bottom line. Around 30 years ago, ECOM re-evaluated and radically changed its business model. Today, the company continues to thrive where other commodity traders have fallen by the wayside. “We would call ourselves the largest sustainable agro-industrial trading company in the world,” says Rahul Gopinath, Head of Africa – Cocoa and New Products. THE FIRST WAVE Three decades ago, ECOM noticed a growing demand among consumers for sustainably-produced commodities. “They wanted to know who was actually producing these products,” explains Mr. Gopinath. “They were asking if coffee was being produced in a socially and environmentally responsible manner. That’s where the sustainability certifications like Rainforest Alliance, Fairtrade, and 4C came in. We began providing our clients with what we called product-level sustainability. This meant auditing and traceability, allowing them to know the source of a product, the conditions under which it had been produced, that there was no child or slave labor or other unethical practices occurring. Because customers were prepared to pay a premium, we’d move the product from its origin while paying the farmer a fair price.” This transformation began with coffee but soon expanded into cocoa and other commodities as well. Nonetheless, with time, it became clear to ECOM that further work remained to be done. “About ten years ago we came to realize product-level sustainability provides consumers with guilt-free consumption but doesn’t add prosperity to the farmer,” says Mr. Gopinath. “The farmer’s lifestyle and disposable
income hadn’t changed in any significant way. We began looking at how we understood sustainability. We noticed that our understanding of product sustainability was being defined by the European or American end consumer. Really, though, we should have been looking at the production process itself and the community that produces the commodity. The only way of improving sustainability through this lens was to improve farmer prosperity.” To achieve this, ECOM began transforming its very infrastructure. FARMER PROSPERITY For ECOM, this transformation entailed a wholesale shift from being a risk manager centered between the producer and the consumer to becoming a service provider for farmers. “Rather than trying to buy cheap from the farmer and selling high to the customer, which is how a normal trader would have behaved, we started being a service provider helping farmers reach their full potential,” says Mr. Gopinath. “Instead of just sourcing sustainable products, ECOM started selling products and services to farmers that meet two kinds of demands: Increasing the income of the farmer significantly, and reducing his risk and costs significantly. We ended up providing agro-inputs and training to farmers while sending agronomists to their fields. Our hiring changed. We used to hire traders, but today we hire agronomists who actually go down on motorbikes with GPS devices. They tell farmers exactly how they could be better pruning their farms SUSTAINABLE BUSINESS MAGAZINE
| 29
ECOM AGROINDUSTRIAL
and how they should use inputs to improve productivity. We turned our earnings model on its head by looking at the products purchased more as a service of liquidity to the farmer, connecting the farmer to the final
consumer. We began seeing ourselves as providing market access to the farmer rather than simply trying to buy cheap from him.” The services offered by ECOM were essentials, like health and life insurance,
cheaper equipment and fertilizers, and access to reliable agro-inputs. Many farmers in West Africa never previously had access to these formerly-costly services. “It changed our relationship to products and the supply chain from being transactional to a relationship based on the complete prosperity of the farming community,” explains Mr. Gopinath. ESSENTIAL SERVICES For ECOM to begin these changes, they first needed to understand the underlying issues that were affecting farmers. The company identified three problem areas: Smallholder farmers were often unable to properly utilize their finite resource of land; farmers often did not have sufficient or correct knowledge of farming; and increasing disposable income alone does not create value. “To resolve these issues, first, we wanted to create a knowledge-
30 | SUSTAINABLE BUSINESS MAGAZINE
able farmer,” says Mr. Gopinath. “We employed large numbers of agronomists, so there is one agronomist for every 500 of our farmers. Under each agronomist are five technical officers, and each officer has around 100 to 150 farmers working with him. All of these individuals are trained in agronomics. They use motorbikes to drive up and down to farms, giving advice to farmers, providing them with training and scientific knowledge. It was important to get farmers to understand farming can be done scientifically.” “Second, we knew that graduates and other educated people were living closer to farms than most government organizations or what they could provide,” says Mr. Gopinath. “So we created a franchise model, where we started franchises instead of having our own staff. Countries were divided into districts and each district is given to a franchisee. They then have full control over the products and services we will deliver on the
ground. The franchise holder goes through training on our products and services, how they are delivered, how agro-inputs and financial services are delivered, and how to train farmers. Under the franchise holder are micro-franchisees. A franchise holder has 20 to 30 micro-franchisees, and under each micro-franchisee is about 40 to 50 farmers.” Third, ECOM began providing essential services, even when they weren’t directly farming-related. “We’re creating value by providing healthcare, education, and social activity,” says Mr. Gopinath. “For example, ECOM is working with a couple of insurance companies to create life insurance products for the farmers. These insurance products are launching in West Africa as we speak. Funerals are expensive in West Africa and can send families into debt. By creating life insurance, we can stop farming communities from plunging into debt and offer opportunities to not only stay afloat but to thrive.”
SUSTAINABLE BUSINESS MAGAZINE
| 31
ECOM AGROINDUSTRIAL
GOOD FOR EVERYONE By establishing a service infrastructure that responds to farmers’ needs, ECOM has begun to show what a future commodities trading industry could look like. “By changing the business case into a farmer-led sustainability model we have done two things,” says Mr. Gopinath. “One is that we’ve changed a significant part of our earnings stream into a flatter, more predictable earnings stream that in turn creates value for the company. Two, we’ve changed our trading environment. There are very
few traders who are in existence for more than ten to twenty years because their value drivers disappear over time. There is always someone arriving with bigger piles of cash or a better trading team that can out-compete them. Our model builds trust and commitment with farmers, who are some of the most risk-averse people, over a long time period. Other traders aren’t around long enough to build the same kind of trust. It’s like building a moat around our business. When we started producing ethical products 30 years ago, it didn’t
Africa • Europe • The Americas • Asia
www.satgurutravel.com
COMPLETE TRAVEL SOLUTIONS FOR BUSINESSES Adjudged Travel Agency of the Year 2016 & 2017
• AIR TICKET • HOTEL RESERVATION • TRAVEL INSURANCE • PROTOCOL SERVICES • MEET & GREET • CAR RENTALS & HOLIDAY PACKAGES • VISA ASSISTANCE
32 | SUSTAINABLE BUSINESS MAGAZINE
T: E:
WITH OVER 68 BRANCH OFFICES ACROSS THE GLOBE
+233(0)54011914 +233(0)249331163 +233(0)556577710 marketing.gh@satgurutravel.com dk@satgurutravel.com • rohan@satgurutravel.com
OUR MODEL BUILDS TRUST AND COMMITMENT WITH FARMERS, WHO ARE SOME OF THE MOST RISK-AVERSE PEOPLE.
yield any significant prosperity to farming communities. It was a good thing for the consumer but we didn’t create value for the farmers and producers, and without them there is nothing. We needed to bring people along with us. We needed to really show farmers what’s in it for them to create an ethical and sustainably-produced commodity. That’s the difference we’ve made.” “We expect to be around for another 170 years – at least,” says Mr. Gopinath. “The age of trading companies working on information arbitrage or trading companies being extractors of value out of origins is over. As farmers gain better access to the
internet, as they understand how to form unions and cooperatives, and as governments themselves start to realize agriculture is going to be the most sustainable way of creating employment, trading companies will no longer be able to have a relationship based simply on transactional value. ECOM knows the next 170 years of our future will not be based on the old practices. It will be based on a long-term sustainable relationship with farming communities, with consumption countries, and with the consumers themselves. We are a bridge between those parties that helps them prosper from each other.” c SUSTAINABLE BUSINESS MAGAZINE
| 33
IMD BUSINESS SCHOOL
What Did We Do Once We Knew? Time for Business Leaders to Connect Heads and Hands to Hearts Written by Susan Goldsworthy and Natalia Olynec at IMD Business School.
“Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has.” Margaret Mead 34 | SUSTAINABLE BUSINESS MAGAZINE
Evidence that the impact of human behavior on our planet is accelerating at unprecedented rates is raising pressure for business leaders to accept their role in stemming environmental destruction to reduce the heavy risks for companies, individuals, and society. The cost of inaction is high in our ‘more-than-human’ world. Global wildlife populations have fallen by 60% in four decades in a “mindblowing crisis” as a result of increasing deforestation, pollution, climate change, and other human factors, the WWF warned in their 2018 Living Planet Report. We have a “rapidly closing” small window between now and 2020 to stem the tide of natural destruction, the
WWF said, urging world governments and businesses to strike a deal similar to the 2016 Paris agreement for climate change. When that time comes, will we ask ourselves, ‘what did we do once we knew’? “We are the first generation to know we are destroying our planet and the last one that can do anything about it,” WWF UK Chief Executive Tanya Steele said in a statement. It’s time for more business leaders to commit their heads and hands to follow what their hearts already know. It’s time to act. In our day to day lives we often live in denial of our denial, distracting ourselves through digital addictions, consumerism, and materialism, to name but a few. We live quietly divided lives, diminishing our own power and agency. The truth is, deep down, we already know what we need as individuals and as a society. When we are ready to listen, an external disruption, like the WWF Living Planet Report or other recent news relating to child detention, migration, or gender inequality, confronts us with a reality we can no longer ignore, and our inner voice is awoken from its slumber. The WWF hopes that if more businesses understand the economic value of the natural environment, they too will take steps to protect it. With the potential for greater cross-border impact than governments, more business leaders are making a personal commitment to more responsible leadership. Days after the WWF report, the British Academy demanded a radical re-think of how business will meet 21st century environmental, social, and economic demands, as well as the challenges of technological advances and globalization. The report on the future of the corporation was backed by a statement of support from leaders in business and academia. Some business leaders are already leading the way, joining unprecedented cross-sector partnerships for change. Take for example the MacArthur Foundation’s New Plastics Economy Global Commitment, which has garnered support from giants like Unilever, Mars, and Pepsico, accounting for 20% of plastic packaging produced globally. The Commitment aims to create a “new normal” for plastic packaging by eliminating single-use packaging materials, increasing the amount of reused or recycled plastics in new products, and innovating to ensure 100% of plastic packaging can be reused, recycled, or composted by 2025. It follows the EU’s decision to ban single use plastics to reduce marine litter. Leading change on an organizational level begins with a conscious, personal choice. A growing number of companies are redefining their business models around ‘purpose’. When he took the helm of Ben & Jerry’s, CEO Jostein Solheim further radicalized the high-end ice cream maker with the blessing of parent company Unilever. He pushed initiatives such as values-led sourcing, supporting Fairtrade, non-GMO labeling, racial equality, same-sex marriage and LGBTQ rights, and campaigns to combat global warming or to halt a ban on travelers from several Muslim-majority countries from entering the United States. The company also introduced vegan ice cream to the mainstream. “We have a long and challenging road ahead of us, but, as a business, we believe we have the power to both influence change and create significant impact,” he said. Millennial employees are also increasingly seeking employers that have both financial and social impact, like Tony’s Chocolonely. The Dutch confectioner was founded by Teun van de Keuken, a television producer who was shocked at the acceptance of slave and
SUSAN GOLDSWORTHY, AFFILIATE PROFESSOR OF LEADERSHIP AND ORGANIZATIONAL CHANGE AT IMD BUSINESS SCHOOL.
NATALIA OLYNEC, SUSTAINABILITY PARTNER AT IMD BUSINESS SCHOOL.
child labor when investigating fair trade and production practices in the food industry. His company aims to eradicate child labor and slavery in the cocoa supply chain, led by the slogan “Crazy about chocolate, serious about people”. It is by uniting our deeply personal knowing with our professional knowing that we can choose to act in a way that challenges what is and inspires what could be for the benefit of ourselves, our organizations, and, ultimately, our society. As leaders, we will then be able to look ourselves squarely in the mirror when we answer the question: “What did we do once we knew?” c WWF’s Living Planet Report 2018 is available to read online at: https://www.wwf.org.uk/updates/living-planet-report-2018 Susan Goldsworthy, a former Olympic finalist, is Affiliate Professor of Leadership and Organizational Change at IMD Business School. She is co-director of IMD’s senior executive program CLEAR (Cultivating Leadership Energy through Awareness and Reflection) and co-author of award-winning books Choosing Change & Care to Dare. Natalia Olynec is Sustainability Partner at IMD Business School and former Global Head of Sustainability for Damco, supply chain management division of A.P. Moller Maersk. SUSTAINABLE BUSINESS MAGAZINE
| 35
GLOBAL EVENTS
FEB
2019
6th - 7th
Innovate 4 Water Kisumu, Kenya www.innovate4water.net
Innovate 4 Water Kisumu is a ‘homegrown’ initiative that seeks to build on lessons learned from the I4W Nairobi forum to provide a sustainable approach to addressing the need for innovation in the water and sanitation sector not only in Kenya but the region as well.
18th - 20th
Power-Energy Summit 2019 Dubai, UAE
Showcasing the latest trends, researches, innovations, developments in the various fields of Power and Energy Engineering. Exploring the disruptions and innovations that are likely to occur in the industries and business processes with the aim of educating the guests to embrace the revolution in all the areas of Power and Energy Engineering.
AfricaSan5, 5th AfricaSan Conference Cape Town, South Africa www.susana.org
AfricaSan is AMCOW’s path-breaking initiatives to promote prioritization of sanitation and hygiene in Africa. It is a Pan-African initiative to build momentum to address the epidemic of a lack of access to safe sanitation and large-scale open defecation.
www.powerenergyconferences.org
18th - 22nd
18th -19th
Middle East Smart Landscape Summit 2019 Dubai, UAE www.landscapesummit.com
This summit will bring together the region’s leading landscape designers and architects. The summit will discuss in-depth the sustainability-focused change of landscape strategies for urban development in the region.
28th - 29th
Renewable Conference North Africa 2019 Casablanca, Morocco
The SSA Power Summit will provide a platform to address some key challenges of improving aging power infrastructure, developing new power infrastructure, more cost effective temporary power solutions, and more.
www.renewablenorthafrica.com
APR 2019 36 | SUSTAINABLE BUSINESS MAGAZINE
MAR
2019
29th - 30th
Middle East Lighting Design Summit 2019 Dubai - UAE www.lightingsummit.com
29th - 1st May
Project Qatar Doha, Qatar www.projectqatar.com
The Qatari construction sector is the fastest growing construction market in the Gulf region, with USD 26 Billion allocated for major projects and accounting for 47% of Qatar’s total 2017 expenditure. Project Qatar is the country’s only business exhibition specialized in construction and all related industries. The show promises fast market penetration into the country’s lucrative construction market, and the opportunity to generate new business leads with companies of all sizes. Project Qatar 2019 is thus a peerless platform, and participation is essential for everyone aiming at seizing a share of Qatar’s arena of opportunities.
The Leading Lighting Design Event in the Middle East focusing on different aspects and elements pertaining to the trends, challenges, and opportunities in lighting design.
ADVERTISERS INDEX C Coastal & Environmental Services
P12
E Electrical Instrumentation Services Ltd.
M Mapaonga Zambia Ltd. Mwachimuko Technical Enterprises
P06
L Leasafric Ghana
P Philafe Engineering Ltd. PPG
P26
R RPS Engineering Services Ltd.
P07 P06
P17 Back Cover
S Satguru Travel Signal Procurement and Engineering Ltd. W World Electricity & Power Africa 2019
P32 P07
Inside Front
P26
SUSTAINABLE BUSINESS MAGAZINE
| 37
PPG PITTSBURGH PAINTS. It’s all you need when you think about painting.
Accra: +233.26.7555253 | +233.26.7555255 Tema: +233.26.7555254 | +233.26.7555265 Kumasi: +233.24.331675 Takoradi: +233.24.4403441 asethi@pslgh.com | haresh@pslgh.com