Environment & Poverty Times


06 2009


Business opportunities and green jobs


The attractiveness of the SIWA oasis offers a great opportunity for both the local community and the ecotourism business. SIWA.


The Poverty and Environment Nexus: A Business Opportunity?


By Sahba Sobhani and Austine Gasnier


There is ample evidence that we are using the planet’s resources faster than they can be renewed, and humanity’s ecological footprint, our impact on the planet, has more than tripled between 1961 and 2003. The biggest contribu- tor to our footprint is the way we generate and use energy: our reliance on fossil fuels to meet our energy needs continues to grow and climate-changing emissions now make up 48% of our global footprint. If continued, the current status of usage of the world’s energy resources paints a destructive path for the future of development. Today, nearly 1 billion households lack access to clean and proper energy supplies, relying instead on resource- depleting, pollution-creating and health-dam- aging sources such as wood and fuel oils.


This situation urgently demands that all actors take action, including the private sector. But beyond the need for the private sector to ad-


dress environmental challenges, the very same challenges represent a significant business opportunity. A large-scale study undertaken by the International Finance Corporation (IFC) and partners to specifically examine the risks and opportunities of sustainability for busi- nesses across emerging economies, found that many businesses were gaining benefits (such as higher sales, reduced costs and lower risks) from better corporate governance, improved environmental practices, and investment in social and economic development.


At the crossroads between business case, poverty alleviation and environ- mental sustainability The Growing Inclusive Markets initiative is a multi-stakeholder research and advocacy platform led by the United Nations Devel- opment Programme (UNDP) that seeks to promote greater inclusion of poor people in markets of goods and services as consumers, producers and employees. This initiative


Green fashion improving women’s lives


In Rwanda the new fashion is to wear these beautiful, colourful, quite unique necklaces, made out of neither precious stones nor expensive materials, but something as simple as out-of-date magazines and calendars. Various women’s associations have adopted this original way of making jewellery and some are even exporting to neighbouring countries. The women get cash- in-hand for their work and together with their agricultural activities they are now able to cover basic needs and even set aside some savings.


A member of one such cooperative, Alphonsine Mukansanga, explains: “I was only a farmer before joining the Tuberwe cooperative. After joining the cooperative I could afford to buy clothes, food and medical insurance and help my family when needed and when they are ill. I am now even able to save some money for cases of emergency.”


In Rwanda poverty affects a larger number of women than men, and its impact is more severe too. Furthermore 86% of the women work in agriculture and only 33% of them are engaged in some kind of wage-earning employment in the non-agricultural sector. But women also take charge of collecting water, food and cooking energy for the household. Women are consequently extremely vulnerable to environmental stress. To improve women’s livelihoods it is crucial to diversify their sources of income. With women much more likely than men to invest in their families and their children’s education, efforts to target women are also key to achieving the goal of poverty reduction in Rwanda.


Recycling paper has not only become an income-generating activity for poor women, it also con- tributes to the Rwandan government’s objective of keeping Kigali clean. Glossy papers, magazines and old calendars are now turned into the most beautiful and colourful necklaces. Not only are the women using old paper, but baskets and bags are being made out of organic waste materials, such as banana and palm leaves and sisal. After plastic bags were banned in the country in 2005, a whole new market for alternatives to plastic bags developed and the Tuberwe cooperative is now selling an increasing number of baskets to meet growing demand. The women in Rwanda have really proved that a more sustainable and resource efficient economy can indeed provide green jobs!


Recycled paper turned into beautiful necklaces. Elise Christensen/UNDP-UNEP PEI.


Inclusive business models in short Inclusive business models include the poor on the demand side as clients and customers, and on the supply side as employees, producers and business owners at various points in the value chain. The benefits go beyond immediate profits and higher incomes. For business they include driving innovation, building markets and strengthening supply chains. And for the poor they include higher productivity, sustainable earnings and greater empowerment.


reflects UNDP’s strong conviction that the private sector is a great untapped resource for achieving investment and innovation to achieve the Millennium Development Goals (MDG), including MDG 7 which focuses on environmental sustainability.


The initiative’s main contribution is to create a climate in which intermediary institutions can make markets more inclusive by gather- ing relevant information, highlighting good examples, developing tools to support busi-


ness and market development strategies, and creating space for dialogue at both the global and local level.


Its 2008 flagship report, Creating Value for All – Strategies for Doing Business with the Poor – was based on empirical evidence from 50 specially commissioned case studies of inclusive business models across regions, sectors and types of companies. The report analyses constraints and strategies for com- panies to expand beyond traditional business practices and bring in the poor as partners in wealth creation. A number of these case studies feature companies that have devel- oped financially sustainable business mod- els with significant environmental benefits, thus contributing to a greener economy.


A wealth of inspiring examples Many inclusive business models contribute to both human development and envi- ronmental sustainability: water provision,


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