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Wildu du Plessis: Commitment to sustainability opening doors to post-pandemic capital in Africa

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Wildu du Plessis, Head of Africa, Baker McKenzie (Image source: Baker McKenzie)

The industrials, manufacturing and transport (IMT) sector is being hit hard by COVID-19 disruption, but commitment to sustainability could very well lead the sector to recovery. This is according to Baker McKenzie’s report “Sustainable Success: Exploring environmental, social and governance priorities for industrials through COVID-19 and beyond” which revealed that industrialshave taken great leaps forward in relation to environmental, social and governance matters (ESG) in the past decade.  The report outlines how CEOs in the sector have signed up to a new holistic definition of company purpose and most public companies now report on ESG goals. Access to funding is also becoming intricately linked to a commitment to ESG principles, with industrials looking at sustainability initiatives as a way to source capital for projects in Africa.

According to the report, the economic challenges and the huge changes that have turned the world upside down in 2020 cannot be ignored, but the fundamental imperative to embed and prioritise ESG remains — and is arguably more important than ever as the fragility of the world’s current systems and norms is revealed.

The report found that sustainability can be used as a lever of recovery and competitive advantage, where companies proactively consider ESG issues as part of their COVID-19 response and decision-making. Connecting sustainability and business models more closely offers industrials the opportunity to reimagine supply chains, production and revenue streams — the basis for long-term reinvention and success. As such, sustainability is set to be a powerful guiding principle of COVID-19 recovery and a source of advantage for IMT companies. In the fight for post-pandemic capital in Africa, embracing sustainability provides a valuable edge for African industrials. Funding in some areas is already contingent on meeting certain global ESG standards and other investors have followed this lead — requiring documented, planned policies and processes in relation to ESG before investing

Access to capital will be critical to corporate recovery and in ensuring that key industrial and infrastructure projects in Africa can continue. Africa’s leaders have been assessing how best to mobilise capital from local savings pools, shore up development finance from various development finance institutions like the International Finance Corporation, the International Monetary Fund, and the World Bank, and direct capital raised via green bonds towards qualifying projects. 

The market for green and sustainable bonds is set to expand further in the coming years and industrials in Africa are likely beneficiaries of the capital raised. The African Development Bank (AfDB) Green Bond programme, for example, facilitates the bank’s green growth policy by providing capital for eligible climate change projects. Investors are able to finance climate change initiatives via green bonds, which is then allocated to eligible projects.

Green bonds are gaining in popularity across Africa and the larger economies of sub-Saharan Africa have all embraced this.  In 2019, Kenya set up the legal framework and rules for the launch of its first green bond on the Nairobi Securities Exchange,  with the aim of raising capital for green transport, water and energy infrastructure projects in the country. The country announced in 2020 that it planned to issue its first diaspora bond for green infrastructure projects this year, so that Kenyans living abroad could be given the opportunity to participate in the country’s post pandemic recovery via investments in sustainable projects.

Nigeria was the first African country to issue a Sovereign Green Bonds in 2017 and launched its the Green Bond Market Development Programme a year later. The Nigerian Stock Exchange (NSE) Green Bond Market is a platform for green bonds in the country and four bonds are listed on the platform. Late last year, the NSE signed a Memorandum of Understanding with the Luxembourg Stock Exchange to promote cross-listing and trading of green bonds in Nigeria and Luxembourg, with Access Bank’s Green Bond the first to be listed on both exchanges.

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In South Africa, in an effort to drive investment and make it easier to list and trade sustainability-linked instruments, the Johannesburg Stock Exchange (JSE) launched a sustainability segment for green bonds in June this year. In July 2020, the African Development Bank invested ZAR 2 billion in Africa’s first Sustainable Development Goals-linked bonds (SDG bonds), which were issued by Nedbank and listed on the newly launched green bonds segment of JSE. This bond issuance is expected to create jobs, promote SMEs run by members of under-represented groups in the country, and act as a catalyst for green projects.

Post pandemic, IMT initiatives in Africa are expected to have a heightened focus on improving Africa’s capacity for green, low-carbon and sustainable development, via, for example, clean energy, community healthcare, green transport, sustainable water, wildlife protection and low-carbon development projects. Wildu du Plessis believes a commitment to ESG principles is clearly taking centre stage in the quest for post pandemic funding, with access to capital for large industrial projects now likely to contain sustainability requirements.

Article by: Wildu du Plessis, Head of Africa, Baker McKenzie

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NGOs - SDGs

Kudoti, South African Recycling Platform recognised as one of the global winners of the Nestlé’s 2021 Creating Shared Value Prize

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Kudoti Co-Founder, Matthieu de Gaudemar (Image: Medium)

Kudoti, South African recycling company, was announced in the top five winners of Nestlé 2021 Creating Shared Value (CSV) Prize, for their innovative recycling impact through technology.

The CSV Prize has been running for over 10 years and has identified multiple initiatives for some of today’s most critical environmental and social issues around the world. This year’s competition, conducted in partnership with the non-profit organization, Ashoka, was entitled ‘How do we create a waste-free future?’,  It aimed to identify and award innovative solutions with a system-change approach and a strong growth potential, or a replicable model for other social, cultural or geographical settings.

Kudoti (meaning trash in Zulu) is changing business perspectives of waste into recovered materials through supply chain solutions.  The company’s digital approach helps track recyclable waste in real-time and matching it to demand. The use of technology improves market conditions for waste materials, which drives up recycling behaviour.

Matthieu de Gaudemar, one of the founders of Johannesburg-based Kudoti, expressed gratitude to Nestlé and Ashoka for this CSV initiative. “Businesses and individuals have a concept of waste as waste, when we should have a concept of waste as a resource.  With new business models, we can change the way that waste is viewed.”

De Gaudemar adds that their platform’s success was collective team effort. “It truly takes everyone to address systemic environmental issues. Through this financial investment and technical resources, we will amplify our impact by scaling up our solution in South Africa.”

“When people speak of the future, a world of hover crafts or holograSaint-Francis Tohlangms may come to mind. But at Nestlé, we are seeking a more environmentally futuristic landscape. Through these  Awards, we are on a mission to identify and empower market disruptors in the hope of accelerating a waste-free future”, says Saint-Francis Tohlang, Corporate Communications and Public Affairs Director at Nestlé East and Southern Africa Region (ESAR).

As one of the winners, Kudoti will receive a cash prize of $40 000 and will benefit from Ashoka’s online resources and workshops to explore potential collaboration with Nestlé and a mentoring programme.

“Innovations such as Kudoti not only help reduce waste but also drive consumer behaviour change which is key to achieving a waste free future and takes us closer to a circular economy”, concluded Tohlang.

By Weber Shandwick

 

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Doing Good Work in Africa Marks Its First Anniversary of Supporting Students and Impacting Future Growth in Africa

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Doing Good Work in Africa (DOWA), a non-profit initiative designed to connect students in the United States to African-based entities focused on providing scalable solutions to commonplace challenges, celebrated its first anniversary in April. Launched during the COVID-19 pandemic, friends Ola Erogbogbo and Emiola Abass, co-founded a program that generated 400 applications and placed ten students at three partner companies within two months. In just one year, DOWA placed 27 students and conducted seven educational webinars with over 400 attendees from over 17 countries.

“DOWA seeks to provide a path to ‘brain gain’ by attracting US students (African and non-African) to the continent through internships. The premise is that the solution to Africa’s problems must come from within, supported by human and capital investments across the globe.” said Erogbogbo.

DOWA connects students with internship opportunities allowing them to work on socio-economic projects and experience the African culture and corporate environment. Students can take advantage of this unique experience through grants and scholarships funded by some universities. Matching the students with partner companies is accomplished through a rigorous application process, provided at no cost to the students. DOWA’s partner companies and organizations address challenges in healthcare, education, agriculture and champion growth initiatives in technology, artificial intelligence, and power generation in Africa.

“We are proud of our partnership with DOWA – we had two interns work on geospatial AI-powered education technology in low resourced environments. These engaged students’ contributions will help further our goal to raise one million AI talents” said Bayo Adekanmbi, Founder at Data Science Nigeria.

Liam Casey, a Venture Capital Fellow at Funema, said, “My experience has helped narrow down career goals and interests in impact investment and venture capital for emerging markets.”

DOWA is intentional in partnering with organizations that have a shared mission to work on initiatives that further the advancement of Africa. Erogbogbo further said, “DOWA believes that the challenges we face on the continent present opportunities, and thus, connecting students to companies working to address these challenges can result in more effective solutions.”

DOWA was launched with the help of founding supporters that include Scholars in Our Society and Africa (SOSA) at Cornell University and Nigerians in Diaspora Commission (NiDCOM). With over 300% participation growth and thanks to its growing network of partner companies, DOWA for the 2021/2022 internship cycles is projected to provide internship opportunities to 70 students from over 20 schools, including five Ivy League colleges.

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GSMA Report Reveals The Gender Gap In Mobile Internet Use Is Shrinking, Despite The COVID-19 Pandemic

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GSMA Report: An estimated 112 million more women started using mobile internet last year across low- and middle-income countries, despite the onset of COVID-19, according to the fourth annual GSMA Mobile Gender Gap Report published today.

Nevertheless, 234 million fewer women than men access mobile internet. Moreover, the underlying gender gap in mobile ownership persists and is proving difficult to close.

Affordability, lack of literacy and digital skills, and lower awareness of mobile internet are critical and common barriers for women. Structural inequalities in society and discriminative social norms also remain a challenge. Even when women have the same levels of education, income, literacy, and employment as men, they are still less likely to own a mobile phone or use mobile internet.

The report further revealed that a record number of women in South Asia now use mobile internet services, helping shrink the gender gap to 15% from 19% last year in low- and middle-income countries.

The gains in South Asia, which had the most significant gender gap in 2019 with women 50% less likely than men to use mobile internet, masked the stagnation in other regions such as Sub-Saharan Africa. Women in both regions now face a similar gender gap in mobile internet use – 37% in Sub-Saharan Africa and 36% in South Asia.

Women were more likely than men to access the internet exclusively via mobile in almost all markets surveyed. In Kenya, for example, 63% of male internet users said they only used the internet via a mobile device compared to 79% of females. This reliance by women on mobile demonstrates the disproportionate benefit of increasing their access.

“If women are to become equal citizens in a more digital, post-COVID world, closing the mobile gender gap has never been more critical,” said Mats Granryd, Director General, of the GSMA. “I urge policymakers, the private sector and the international community to take note of the important findings laid out in the Mobile Gender Gap Report because only concerted action and collaboration will enable women and their families to reap the full benefits of connectivity.”

The GSMA introduced the Connected Women Commitment Initiative in 2016 to catalyse action to close the mobile gender gap. Mobile operators continued to make commitments during 2020, with 40 mobile operators across Africa, Asia and Latin America making formal commitments to accelerate digital and financial inclusion for women since 2016. These operators have already reached more than 40 million additional women with mobile internet or mobile money services.

The GSMA’s Mobile Gender Gap Report 2021 is available at: https://www.gsma.com/r/gender-gap/ 

Further information on the Connected Women Commitment Initiative can be found at: https://www.gsma.com/mobilefordevelopment/connected-women/the-commitment/

 

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