By Ron Bills, Envirofit Chief Executive Officer and Chairman of the Board
For businesses wanting to a make a social impact, the best place to begin is by taking a closer look at the UN Sustainable Development Goals (SDGs). The SDGs provide a framework to address the root causes of poverty and ensure that global social challenges are solved inclusively. As a social enterprise, Envirofit’s goal is to use business as a means to address global social challenges by producing affordable clean cookstoves and other clean energy products. The Global Alliance for Clean Cookstoves has highlighted how cookstoves directly contribute to 10 of the 17 SDGs, the most apparent being SDG #7, Affordable and Clean Energy. In addition to that, I’d like to focus on three other SDGs that have been major impact areas for Envirofit that other businesses can act on too. Implementing these goals has made social as well as business sense, helping us grow from a startup cookstove manufacturer to a global company with over 1 million stoves sold.
Prioritizing gender equality helps find new talent and reach more customers (SDG #5)
In many of the countries where we work the business environment is still primarily dominated by men. In fact, when we first started working in Kenya we found that nearly 90% of our salesforce was comprised of men, and there was a general attitude that sales was a job for men. However, we made the decision to invest time and energy into recruiting female sales agents and developing an empowerment training program to help them succeed.
What we found is that women who have been through our Women’s Empowerment Program (WEP) are better at communicating the benefits of our products to other women. This has improved the overall customer experience and led to increased sales, as women who have completed the program are 3x as likely to be top sellers. Now we are working to scale this program across all of our business units in South Asia, Latin America, and West Africa.
Standard market mechanisms will not reduce the gender gap. In order to make progress on gender equality, companies need to actively encourage more women to participate in the job market. This is done by creating programs, such as the WEP, that help women by instilling business skills and personal agency, and also by fostering a supportive workplace that counteracts exclusionary business environments. By pursuing gender equality, Envirofit has benefitted from adding talented and motivated people to our team who would not have otherwise been in the job market, and whose skills have helped us improve our approach and increase sales.
Shifting the view of people living in emerging markets from beneficiaries to consumers opens new markets, growing business and the global economy (SDG #8)
The majority of multinational companies primarily view emerging markets as a cheap place to manufacture goods. While this creates low wage manufacturing jobs, the product is exported with a disregard for the potential market within these countries. Envirofit was driven with the mission to innovate and deliver clean energy solutions for people living in emerging markets and discovered a savvy, quality and price-driven consumer market that was yet to be tapped. Some FMCG companies like Nestle, Unilever, and Colgate have already shown success in reaching this market, with 90% of Unilever’s global growth from 2008-2014 in emerging markets comprising 58% of their business.
Realizing the potential of the emerging market economy not only helps companies increase their market potential, but helps to develop the global economy. In turn this helps achieve SDG #8 by promoting inclusive economic growth through bringing in more than just manufacturing jobs, but also jobs in research, HR, supply chain, marketing, and sales among others.
Investing in climate mitigation drives innovation and helps to build the company brand (SDG #13)
Companies often see climate mitigation as costly and adverse for business. However, investment into integrating climate mitigating technologies and services can increase the value of the product to the customer so long as performance isn’t affected. When hybrid electric and fully electric vehicles were first introduced, many wondered if customers would pay for a product that was perceived to sacrifice performance for environmental friendliness. However, once consumers realized that this wasn’t a trade-off they had to make, the products’ eco-friendliness became a major selling point.
Envirofit has invested years of research into creating clean cookstove technologies that are highly efficient and useful, while maximizing CO2 reduction. Making climate mitigation a priority not only led to environmental impacts, but these improvements translated into savings for the customer- reducing fuel use up to 60%. For consumers in emerging markets who have to spend up to 30% of their annual income on cooking fuel, or devote up to 2 or more hours a day collecting wood, this can have a dramatic impact and become a key value proposition.
Across the world we are seeing a shift in consumer behavior where, according to Sustainable Brands, 50% of global consumers are willing to pay more for products that have social and environmental impacts. So while it might seem like a large investment in climate mitigation technologies and services, the impacts serve as tool to engage your customer base and build a stronger brand.
The private sector is entering a shift in focus where companies are being held accountable for more than just the bottom line. Now they must include social impacts to appeal to customers, investors, and potential employees. Envirofit’s integration of the Sustainable Development Goals into our business strategy not only helps improve the global economy, but also offers an untapped opportunity for profitable business growth. Soon I hope there will be no distinction between a social enterprise and an enterprise, as what’s good for the world is also good for business.
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