Companies are producing more responsibly, more sustainably
11 Jul 2017 by Paula Pelaez, Programme Manager, Business Call to Action
The world is a riskier place to operate in.
Populations are growing and feeding people is becoming trickier. Climate change is challenging our security and ability to make a living. Global markets have become more unstable.
For companies, these global trends present both risks and opportunities, requiring them to rethink how to source and produce in a sustainable way.
At the Business Call to Action, we work with companies who are applying sustainable principles in their daily operations. What have we learned from them?
1. Involve small producers: Engaging small-holder producers can help companies secure raw materials or ingredients locally and competitively. In fact, that can also help inspire innovation with new materials, designs, or products. Japanese lifestyle brand MUJI sources soapstone from local producers in Kenya and wool felt from Kyrgyzstan, training them to meet international standards. In Burkina Faso, L’Occitane sources quality shea butter – a key ingredient for many of their products – from women’s cooperatives.
2. Develop innovative solutions: Companies are helping smallholder farmers equip themselves against climate change, through access to better seeds, training in sustainable agriculture, or access to micro-insurance. Ignitia, a high-tech social enterprise, delivers tropical weather forecasts to farmers via text messages. Bangladesh-based vegetable retailer Direct Fresh advises farmers on sustainable pest-control, techniques for improved yields, and access to loans. Juice producer Sambazon, works with 7,000 açaí harvesters on organic, non-invasive harvesting principles, increasing their earnings and eliminating destructive forest practices in the Amazon.
3. Keep it local: products with high value-added can be produced and consumed locally. One way is to bring well-paid manufacturing jobs to communities instead of relying on them to export raw materials to factories elsewhere. This also helps reduce companies’ carbon footprint. Nutriset, a world leader in ready-to-use therapeutic foods such as high energy spreads and milk products that treat severe acute malnutrition, supports over 1,000 jobs through local manufacturing. It supplies 35 percent of the global demand for these products, keeping 3.6 million children well fed in Asia, Africa and Latin America.
4. If it’s not ethical, it isn’t worth it: Respect for human rights in local production is essential. Partly driven by legislation like the Dodd-Frank Act, investor’s, or consumer’s expectations, companies are now sourcing conflict-free minerals, responsible forest products, or palm oil that is sustainable. These efforts are often reflected in collective industry efforts, company sourcing policies and monitoring systems, as well as educating suppliers to new standards.
5. Motivated employees make good businesses: Working conditions matter, which is why training, decent wages, and good working conditions are so important. Essilor, the world’s leading ophtalmic company, trains local individuals to become vision entrepreneurs, as part of their business model to bring affordable and accessible eyecare to developing markets. DataMotivate, an outsourcing company based in the Philippines, gives professional training and jobs to survivors of human trafficking and slavery in the financial and real estate sectors.
These practices don’t just create more sustainable economies. Already, businesses are seeing clear benefits. Supply chains are more robust and efficient, secured through better relationships and trust. Companies discover new local talent and keep their employees motivated. In other words, success in the business world and sustainable development don’t just sit well with each other. They are becoming two sides of the same coin.
Hosted by UNDP, Business Call to Action is working with over 190 member companies who incorporate low-income populations in their value chain – making concrete contributions towards the SDGs. They represent all regions and include multinational and large national companies, as well as small and medium sized companies and social enterprises across a range of sectors including agriculture, infrastructure, healthcare, energy, financial services and mobile technology.