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Green Strategy and Sustainable Development

Final Group Assignment:

Fully Inclusive Sustainable Business Models -


Evolving Socio- Economic Entrepreneurship to involve sustainable environmental
practices in developing markets
PROFESSOR: Raghu Garud

Yacob Aschalew Tsegaye


Pullkit Pasrija
Terence Nugent
-Introduction-

Social entrepreneurship is the use of the techniques by start up companies and other entrepreneurs to
develop, fund and implement solutions to social, cultural, or environmental issues. 1 The sustainable
energy solutions market is growing and big global businesses are gradually starting to make the changes
towards more socially responsible and sustainable practices. As well as the global business trend towards
responsibility, there are several initiatives by Aid associations and NGOS such as the UN, REDD and
Green Peace to help boost both the urban and rural economies of different developing countries whilst
trying to solve environmental issues.

The developing world has a vast network of different social and environmental issues. Some of the main
ones theorized in this paper are Energy Supply and Production, effective Waste Management solutions,
Environmental issues (desertification, erratic weather patterns, drought), Employment and Economic
issues and effective Sustainable Supply Chain Management solutions.

-Current Developing country Problems-

More than 1.3 billion people worldwide still lack access to electricity, with more than 95% of them located
in sub-Saharan Africa and developing Asia and 2.6 Billion still use biomass and wood for cooking and
heat.2 Some of the challenges of energy supply in developing countries is the lack of connectivity to an
energy grid. Building and connecting a new grid is expensive and can take time with planning and
permissions. The lack of income of many rural settlements also makes them an unattractive investment
for energy firms trying to expand their production capabilities and grid connection.

Only 20-50% of municipalities with reoccurring budgets spend on solid waste management and only 50%
of the Urban population has access to waste management services. 3 Rural areas are particularly behind
with only 31% of rural populations in developing countries having access to improved sanitation facilities
and 58% having access to improved drinking water sources. In low income countries the cost of collecting
waste alone can drain up to 90% of the waste management due to ineffective logistics. 4 The lack of waste
management creates large open dumps often within range of villages and cities. One of the main ways
used to dispose land fill waste is to burn in causing very large emission rates often unable to be
documented.

The global population is expected to reach 8.5 billion in 2030, 9.7 billion in 2050 and 11.2 billion in 2100.
The worlds population aged 60 or above is growing at a rate of 3.26 percent per year and more than
three-quarters of the worlds population lives in Africa (16 percent) and Asia (60 percent). 5 Urbanization is
set to increase our populations of people living in cities from 30% (2000) to 60%.
The rise in population will mean the need for more space, more food and water, a higher energy demand.
A larger population will mean more jobs need to be created to help sustain the economy and match these
demands. In 2013, there were about 157.1 million unemployed workers throughout the worlds developing
nations, East Asia has the largest number of unemployed workers. Sub-Saharan Africa has the second-
most jobless people (27.2 million) and a 7.6%, followed by South Asia (26 million) 2.
The fast rate at which developing countries are growing and industrializing is causing large amounts of
deforestation and the turning of land for agriculture, manufacturing and other development like increasing
the supply to energy grids. This lack of trees causes a change in the rainfall patterns often creating longer
periods without rain and stronger rain periods when they do come. The lack of rain causes arid areas to
form and the lack of humidity affects the local biodiversity as well as affects local farming. The heavy rains
mixed with the lack of plant coverage means the water washes through not only eroding the soil but also
making it less fertile which in turn means the soil become unusable for agriculture so more trees need to
be cut in the search of fertile land further increasing the problem.
Supply chain management management is often a problem coming from the lack of development and
education in different areas.

-Goals-

A fully inclusive business model should include solutions socially, culturally, economically and
environmentally at a local level. Our theory is that existing or new, a large and global businesses can
invest or customize their business model with a community whilst providing several of the basic needs to
a community and still being a sustainable business. Being able to successfully implement such a model
would create shared value between the business and the local community.
There are many examples of socio-economic and environmentally conscious business models focusing
on one or more social issues at a time.
Mini energy grids;
Where one or several forms of mini energy production units (solar panels, mini wind turbines, biomass
units, solar water heaters) are either positioned individually or are connected together to form mini grids.
These are often used to allow small businesses to be able to produce energy if in a rural area or off the
energy grid.
Urban farming;
Unused urban areas are turned into gardens for growing produce. This model is often seen in more
developed urban cities. The sources of income that this creates often includes either location rental,
produce sale, usage for community learning centers.
Shared Space;
A model which is used either in large developed cities to share office and work space. Also used in
Agricultural areas for animal farming or growing, this is often on a plot rotation system. This allows for
several different people to be able to utilize the same land.
BioGas Energy systems and Waste Gasification plants;
BioGas systems are often used rurally. This allows for remote gas production and a basic form of waste
management for communities. Waste gasification technology is becoming cheaper and more available
and is a solution for all types of waste, producing oil, gas and energy depending on the unit. These are
often used in small independent waste management companies.

-Possible Benefits of including community issues in the Business Model-


The web of Geographical locations, political situations, economic situations makes the different
developing countries differ in their socio-economic needs. We argue that by shaping your business to
address these different social, economic and environmental issues, it will be sustainable and profitable on
the long run as it will add value to the different sectors of the economic value chain at the local level. This
has benefits for both the business and the community it is in.

With a growing population, the need for energy security in urban and rural areas is going to be on the rise.
Energy in remote locations can be costly for both the business or the local community. For a business, a
solution could be to invest in your own energy production capabilities to insure energy security for
yourself, but depending on the business this could require a large amount of land. Another solution to this
as well as a way to include a community could be to source the space from the community in coming up
with a partnership with them in utilizing roof space or unused space for PV panels. Investing in energy
production for business use would provide energy security for locations off the grid. This could potentially
be done by solar, wind, or biogas solutions. Potentially by knowing different factors such as Feed in tariffs
and surface area needed to produce x amount of energy, you can calculate the total energy needed to be
able to provide energy security for your business, security for the local community as well as a return from
excess energy.
Sanitation and waste management Benefits. With our current technologies, waste can be used to
produce energy, gas, oils and fertilizers. Developing countries have problems with managing large
amounts of waste that usually end in dumps or rivers or seas, human bio waste coming from poor or no
plumbing and sanitation management and animal and produce waste coming from un sustainable and
underdeveloped supply chains. By implementing waste solutions into your business model you are not
only effectively providing a solution to manage your own waste, but also local waste management benefits
for the community. The production of gas provides a better alternative to burning wood for heat and
cooking, which has harmful side effects for both the community and the environment. This can also be a
solution to reducing waste in land fills and producing at the same time, example gasification machine. By
adding waste management for the production of gas and energy quantifies the waste potentially allowing
a business to calculate how much waste needs to be collected to be economically beneficial to both
parties.
Health and Raised living conditions. Better waste management will result in better health at the local
level as well as raised living conditions. Energy security will help with development allowing for longer
ability to use light increasing productivity in many businesses as well as on a public level (extended school
times or available study time for children, less time to cook for families, connecting to telephone and social
grids etc).
Educational and Economic benefits. Some of the discussed problems in developing rural areas come
from education and economic problems, the local community doesn't have the knowledge to be able to
manage new technologies, the cost of sending workers with the knowledge or teaching new workers is
costly and complicated. A solution for a larger business entering an area should be to plan a business
based around the need of manual labour. Investing in logisitc style businesses and waste management
solutions will require many manual labour vs skilled labour. This creation of employment also allows
communities to learn of the benefits that come having these sustainable technologies as they will be
connected to them.
Shared value across the value chain for both business and local community. The creation of many low
educational jobs would mean an increase in potential employment benefiting the local economy. The jobs
could range from building, transporting, waste logistics, produce logistics. The introduction of waste
management facilities raise the living standards for the local community as well as provides a way for a
business to manage its own waste. The usage of energy production technologies will keep both the
business and the community supplied with energy.

-Conclusion and Example Theory Cte DIvoire- Using a Produce storage and logistics
facility as a business model-

Cte dIvoire is located in west Africa and has a coast line. It has a tropical climate with three seasons (2
dry seasons and a wet season) and 32% forested land, 65% agricultural and the rest is classified as
other. It has a population of 24 million, 54% urban, 40% connected to energy (mostly urban), 45% literacy
rate.6 There is a large energy grid which covers the country but it is not developed to reach rural areas.
There is also a large road grid connecting the whole country but again it is not very developed in rural
areas.
Some of the essential needs of a Produce Storage and Logistics facility can be related to some of the
basic issues in the rural Ivorian population or solved by the rural areas in which the populations live. A
storage business needs a large amount of space, a large amount of energy for the facility to run, will have
large amounts of produce waste so will need good waste management options, will need manual
employees , and essentially would need produce to store and sell. Some of the basic issues in rural ivory
coast are the lack of connection to an energy grid so the lack of energy production in certain areas, lack
of waste management, most waste ends up in landfills and most sanitation facilities in rural villages are
outhouses. Most farm produce is sold in cities. Most areas are often far from main cities and so the rural
farmers have to either travel often and far or use middle men to trust to sell their produce. As well as
taking a lot of time, being a hot and humid climate, once harvested food produce (especially water based
produce) has a shortened life span resulting in a large loss of produce costing the local economy.
By placing the facility near local communities, a business can solve several of its needs as well as
address the local problems. It would need large amounts of space for the solar panels needed to provide
the energy to their facility. A potential solution would be that they could provide energy to the local
community in return for using the space available in the villages to help make up the surface area needed,
benefitting both parties. Being a produce facility, they will need space for managing the excess waste that
comes from expired or damaged produce. By using a Biomass plants or a small Gasification plant to
produce energy and gas, you can come up with a solution to the local community for landfill waste, human
waste (rather than outhouses use underground tankers where waste can be pumped out for collection),
and agricultural and farming waste. There is a lack of money flowing in rural economies, farming is time
intensive and produces a low return to time, there is a lack of manual blue collar work available, and the
lack of a skilled labour force often results in few development investments in the rural economies. A
Produce facility would provide more manual labour jobs (less need for a highly skilled workforce) as well
as produce from the local farmers to be able to sell. This will help address both these economical issues
as well as provide a solution for local farmers to sell their product locally. Knock off benefits will also
develop with this style of business model. Having access to energy and gas will raise the living standards
overall, power schools, social connection of communities, allow homes to stay lit later and more
conveniently than the traditional fire places, easier cooking, better sanitation knowledge, but most
importantly create a sustainable environment where both the local community and business benefit.
Overall, Further study and research must be done at a local level to include the potential for remote
energy production technologies, waste production technologies and solutions, Energy tariffs in the specific
countries, geological studies (solar radiation, wind speeds) and population studies (rural locations), local
and national problems at a political and economical level. But with our advances and availability in
technology it is possible to consider many different socio and economic issues and use them to create a
sustainable business.
-Potentially positive Sustainable business plans-
http://www.edenprojects.org/mission
https://wri.org/our-work/project/forests-and-landscapes-indonesia/
http://www.saharaforestproject.com
http://transafricapipeline.org
https://www.epa.gov/sites/production/files/2015-
10/documents/1.urban_farm_business_plan_handbook_091511_508.pdf
http://www.nrel.gov/docs/fy06osti/39943.pdf (Over all small biogas plants costs)
References:
1. https://en.wikipedia.org/wiki/Social_entrepreneurship
2. (https://www.theglobalist.com/9-facts-unemployment-in-the-developing-world/)
3. (http://www.ewp.rpi.edu/hartford/~ernesto/S2014/SHWPCE/Papers/SHW-Introduction/Chandak2010-SWMTrends.pdf).
4. (http://unohrlls.org/about-ldcs/facts-and-figures-2/).
5. (https://www.compassion.com/poverty/population.htm)
6. (https://www.cia.gov/library/publications/the-world-factbook/geos/iv.html)
Other references
https://www.epa.gov/sites/production/files/2015-10/documents/1.urban_farm_business_plan_handbook_091511_508.pdf
(urban farming)
http://leeds-faculty.colorado.edu/moyes/bplan/Samples/Ambeeka/Ambeeka.PDF
(great business plan layout from 2000.)
http://www.erm.com/globalassets/documents/presentations/2014/sustainable-solutions-for-the-oil-and-gas-industry.pdf (consultancy
group for oil and gas - not too much said though)
https://en.wikibooks.org/wiki/Sustainable_Business/The_business_plan
http://eng.sinohydro.com/index.php?m=content&c=index&a=lists&catid=28 (sinohydro, sustainable business initiative.)
http://gogreenplus.org/nuts-and-bolts-guide/performance-nuts-and-bolts-guide/sustainability-management/sustainability-plans/