One Africa, One Voice
Highlights of the CEO Connect Roundtable Discussion on 4 June 2021
Competitive collaboration is an essential building block for Africa’s economic advancement, but of equal importance are the vital roles that both government and business have to play in addressing societal issues and building a Shared Value ecosystem.
An African farmer, who grows wonderful corn year after year, is asked to reveal his secret: I give my best grain to all the farmers around me. I know the wind blows the pollen from their corn onto my land and, if they have bad corn, then mine will be bad. The bottom-line? Building back better because you collaborate and share with your neighbours.
This very apt analogy of creating Shared Value was used by Dr. George Njenga, Executive Dean at Strathmore University Business School, to set the stage for an engaging leadership dialogue at the recent CEO Connect roundtable hosted by the Shared Value Africa Initiative (SVAI).
With leadership representation from Allianz Nigeria Insurance, Safaricom, Old Mutual, Abbott Laboratories, Gautrain Management Agency and Enel Green Power, the executive discussion focused on competitive collaboration and Shared Value strategies as key economic drivers for Africa; and prerequisites in a decade of action where people, planet and prosperity take center stage.
Participants identified collaboration among companies and between business and government as essential building blocks in Africa’s economic advancement. Discussions also focused on critical solutions that encompass the unity of business and government, education of the values and strategies inherent to a better society and, right from the word go, the use of technology to drive those strategies.
One great example of such a successful private partnership is Safaricom’s MPESA solution, a mobile financial payment platform launched in 2007. It has forever changed the face of financial inclusion in Kenya from 30% to 82% and, in doing so, also influenced the whole of Africa in developing a better distribution of cash and finances.
In Africa, telcos and financial institutions have a real opportunity to combine the power of technology and innovation to really enable society to live better lives and, one of the key ingredients of Safaricom’s success in this regard, is leading from a purpose of transforming lives.
This is according to Safaricom CEO Peter Ndegwa, who passionately believes that doing good, is actually good for business. “When, as a business, you can you lead from purpose, solve social issues and enable society to do better, you will have a more sustainable business and you will form a real connection with society.”
On par with the power to transform lives through mobile money and connectivity, is the potential of renewable energy in building a better future for all.
In the past, the public good was electricity and it had to be as cheap as possible. Today, the renewable energy program really is a trendsetter in creating shared ownership with communities.
Africa, however, faces countless energy distribution and infrastructure challenges across the continent, with a high dependence on fossil fuels. Additionally, there are also multiple renewable energies, which in themselves create unique challenges in terms of managing the variability of energy resources, including assessments and investments into related energy storage applications and batteries.
Currently, most countries have a monopolistic utility that provides energy to all. As a result, independent power producers are unable to provide energy to any commercial customers.
“If we are to unlock the promise of renewables, governments have a vital and enabling role to play in creating markets in a transparent and clean way. Governments have to open up the market, invest in infrastructure, promote clear regulatory policies and issue transparent tenders for the supply of both energy and infrastructure,” argues William Price, Country Manager of Enel Green Power Southern Africa,
More specifically, governments have to establish the required infrastructure and regulatory policy for open, transmission access in order for providers to provide energy to different customers. “We encourage anyone looking at or involved in renewable projects, to embrace and promote Shared Value by having clear policies on local content and resources. Governments should encourage suppliers to use local labourers, as well as spend and develop local resources so they can support the power plants in which we operate,” adds Price.
For life insurers like Allianz Nigeria Insurance and Old Mutual, well-defined regulatory frameworks and stable regulatory environments are also fundamental to de-risking infrastructure funding and reducing the cost of capital.
Says Old Mutual CEO Iain Williamson: “Infrastructure is the perfect Shared Value asset and an ideal conduit for long-term wealth creation, because it underpins the levers of the economy. It inherently provides multiplier effects into the community, economic development and job creation over long periods of time.”
Of course, as a consequence of being a life insurer, Old Mutual is ideally placed to be a financier for infrastructure, in particular relatively illiquid and long dated infrastructure. In fact, many funders like Old Mutual are prepared to provide infrastructure funding at competitive rates, but in the final instance it all comes back to a well-developed and clear regulatory environment.
Given the long-dated nature of the liabilities that life insurers carry, any uncertainty regarding regulatory framework and environment will drive the cost of capital up exponentially. As such, partnerships and collaboration across the ecosystem – funding providers, developers of infrastructure and regulatory frameworks – will be critical in this Decade of Action (towards achieving the Sustainable Development Goals).
Equally, if not more important, will be market education and market development, according to Allianz Nigeria Insurance CEO Adeolu Adewumi-Zer.
“When all is said and done, everything keeps coming back to the same core issues around trust, knowledge, and access. The entire ecosystem, particularly the value chain for insurance, is underdeveloped. It is about financial inclusion and making sure that even the 40% of people living under the poverty line, as is the case of Nigeria, can still have access to the same security that someone in the developed world has access to. This will not come from regular banks or current financial models as it also involves education and access, which we need to do in partnership with government.”
Of course, none of this truly matters if the people of Africa are not enjoying good health! In the words of Monica Sanders, Director: Global Citizenship & Shared Impact at Abbott (USA): “We see good health as the key to achieving anything in life – when you have your health, you have everything.”
Health care, according to Sanders, is not only an opportunity to create economic growth. “It is through good health that we can build a healthy society capable of realising higher economic productivity – all of which is needed to lift people out of poverty.”
She is also very passionate about more inclusive and equitable gender policies as key to Africa’s growth and recovery. Sanders cites the work Abbott is doing in Rwanda, in collaboration with the Rwandan Ministry of Health and an NGO partner, Society for Family Health, as prime examples of equality fueling progress.
The multi-stakeholder collaboration in Rwanda involves a project called the Second Generation Health Post (SGHPs) Initiative, which expands access to health care in rural areas and provides primary care, including antenatal care and safe birthing options for women in the community. Sanders sees these facilities as key to creating entrepreneurial opportunities and career paths for women in the communities. Already some 25% of these SGHPs are operated by women, with plans underway to scale up and double this number, and 80% of the lab technicians working in these facilities are women.
Regardless of industry sector or company, all executives participating in the CEO Connect agree that trust, knowledge, inclusion and access are the core issues that can either impede or fast-track Africa’s growth and development.
These are the challenges that business leaders need to address collaboratively, because one company cannot do it on its own. Even one market cannot do it on its own. CEOs need to look across Africa and come together across borders to address these issues from country to country.
William Dachs, CEO of the Gautrain Management Agency, succinctly wraps up the discussion when he observes that it all comes down to unity, collaboration and working with government, industry and educational institutions to build market capital that speaks to shared value.
“In the final instance it is what we, as leaders and as organisations, do about creating shared value – not by dictating a shared values system, but by leading through innovation in creating shared value,” he concludes.
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