The Covid-19 pandemic has
changed our world. The scale of
the crisis and required national
lockdowns could wipe out about a
third of jobs across the continent, with
the continent’s GDP growth slowing
dramatically and close to 27 million
people pushed into extreme poverty.
The scale of the devastation caused by the
pandemic has prompted unprecedented
responses across the continent. The
degree to which African governments
and businesses are working together is
demonstrating the power of joining forces
to create collective impact. In collaboration
and alone, businesses have taken rapid and
significant steps to initiate community
emergency relief efforts, simultaneously
focusing on business continuity.
The response thus far points to the
opportunity that provides some hope
within the challenges. Those governments
and businesses responding to the pandemic
are leading the way in a broader shift to the
very system on which our economies are
constructed, a finding of common purpose
towards which leaders of governments,
SHARED VALUE
Post Covid-19: A System
Change Is Needed And
The Private Sector Can
Lead It
corporates and civil societies are driving.
There are numerous corporate initiatives.
In Kenya, for example, KCB Group has
contributed funds towards interventions
to cushion citizens from the economic
hardship brought by Covid-19. In
operations across the continent, Abbott
Laboratories has moved rapidly to
launch a rapid test kit for the virus. UAP
Old Mutual’s set of initiatives includes
assistance for business and individual
clients, as well as work with partners to
provide funding for healthcare workers.
There are many other examples.
However, while many leaders, shareholders
and investors are assisting their employees
and governments during this health care
crisis, not everyone has answered the call.
Even greater levels of effort to work for
the needs of society and environment are
a required at a time when globally, the role
of business in society is being questioned.
Companies are held accountable to be
good corporate citizens as dictated by
country laws - through government
policies, rules and regulations, paying
of taxes, increasing inclusiveness of the
The degree to which African governments
and businesses are working together is
demonstrating the power of joining forces
to create collective impact. In collaboration
and alone, businesses have taken rapid
and significant steps to initiate community
emergency relief efforts, simultaneously focusing
on business continuity.
By Tiekie Barnard
sector, and CSI initiatives.
However, there is so much more that the
private sector can do. This will reduce
consumer questions about corporate
motivations for their philanthropic
initiatives. Socially oriented business
strategies also have long-term business
benefits: only through healthy,
economically active communities can
business ensure its own sustainability.
Today, business success is no longer
measured in financial value alone. It is
measured in how companies create shared
value by taking meaningful, visible steps
to tackle major social and environmental
problems. To attract investment and
retain their social licence to operate,
companies need to rebuild their strategy
around partnerships and positive social
and environmental outcomes. Doing so
will lead to increased revenues and more
sustainable economies.
For this reason, now is not the time to be
concerned about shareholder returns, or
about investor satisfaction. It is now about
looking after Africa’s people and their
fight to survive - through addressing their
immediate needs such as health, food and
shelter. That is more important than any
financial returns, shareholder satisfaction
or impressing investors.
Calls for businesses to assist in continentwide
relief efforts are now becoming a
demand, expressed by those facing the
hardship of having no incomes during
lockdown periods. Companies are rightly
profit-focused but are increasingly
looking also to generate social returns,
understanding that they have a
responsibility towards the communities in
which they operate, the environment and
society at large.
One thing is clear: we are all going to
pay a price during this time. However,
businesses have a collective responsibility
to assist wherever they can. History cannot
repeat itself with only a few benefiting, as
that will mean that we have not learned
anything out of all the suffering. Assisting
will also contribute to the implementation
of the United Nations’ 2030 Sustainable
Development Goals (SDGs) which ask
companies to adjust their operating
models to meaningfully address global
challenges.
Yuval Noah Harari, an Israeli historian,
professor at the Hebrew University of
Jerusalem’s History Department and
author of popular science bestseller
Sapiens, argued in his article “The world
after coronavirus” that the decisions
people and governments take during this
period will probably shape the world
for years to come. They will shape not
just our healthcare systems but also our
economy, politics and culture.One such
decision is that consumerism for now will
take a back step for a while. With spend
now focused on health and survival, “unnecessary”
products will have to wait for
better times. This has a range of positive
impacts, though it also hurts large parts of
the private sector. For example, we already
seen figures from China showing that
Covid-19 has reduced the Chinese CO2
emission by almost 25%.
Nobody can argue with the fact that
this is a time like no other. Risks need
to be taken. Due to the importance of
turnaround time, responses cannot be
researched, analysed or even at times
delayed until a board meeting or until we
inform our shareholders or investors. We
need to act, and we need to act fast.
Those in the informal sector, living from
hand to mouth, are suffering. Some
smaller businesses are waiting for the
big ones to pay them. At this time, using
Covid-19 as a reason for non-payment of
work delivered is not acceptable. Large
corporates could be relooking their 90
and 120 day payment terms. These cannot
hold in these trying circumstances - nor,
arguably, in the future. It is time for a
system change.
That system change needs to come from
the entire private sector and requires
some hard questions and even harder
decisions. Some food for thought: Can
we, as leaders from the wholesale and
retail sectors, reduce our profit margins
and make food more affordable? Can
we, as leaders, look at reducing transport
and telecommunication costs drastically?
Can our health care sector increase the
minimum wage of health care workers?
Can we, as leaders, undertake that we will
always pay a living wage? Are we prepared,
as investors and shareholders, to accept
that the return on our investments will
not be what is was before the pandemic
and can we practise patience? For those
organisations that can afford it, can there
be an internal support or relief programme
for employees? Understanding the
existence of gender-based violence, can
business implement internal check-ins
with employees working from home?
What business needs to achieve during
this time is not easy - and particularly
for companies that have not traditionally
considered social upliftment to be more
than a philanthropic sideline. We see
the challenges that sometimes seem
unsurmountable when working with
clients to co-create business strategies that
deliver economic value as well as value for
society.
Shared value involves businesses partnering
with role players across sectors - including
government, non-profit organisations,
civil society groups and development
agencies - to develop solutions to pressing
social needs. It involves empowering,
uplifting and building the resilience of
communities through education, training
and entrepreneurial initiatives. In the
process, a company can strengthen its
supply chains, improve the quality of its
products and broaden its markets.
This approach resonates very well in Africa,
a continent with immense untapped
potential for innovation and growth but
facing longstanding social challenges.
For Africa to realise its potential and
become globally competitive, social
problems need to be tackled by a coalition
of role players working together. Charity is
not a sustainable way of promoting growth:
Africa’s people want opportunities.
Similarly, many of its key business leaders
want to invest in initiatives that enable
mutual success.
Becoming Part Of The
System Change
So how should a business start to become
part of the larger system change that is
required?
In short, what drives the shift is for a
company to identify business activities
and investments that drive social change
and, through them, business results.
A company starts by identifying a key
social or environmental issue that is
holding the business back or affecting
the business negatively. A solution is
developed, and a financial business model
build around the solution to ensure the
delivery of economic value and value to
society, called profit with purpose.
The solution might include partnering
or collaboration and planning with other
organisations never losing focus of the end
result, profit with purpose and ultimately
the benefit to society. This goes beyond
existing social impact initiatives that
focus on philanthropy, reputation and
compliance.
Driving this approach is a network of
businesses and associations working
towards social and environmental change.
Shared Value Africa Initiative is a network
of established and start-up businesses that
focus on creating and building prosperous
and sustainable economies.
Often companies are not sure how to
move from purely profit-focused to
demonstrating their responsibility towards
their environment and society. Shift
Impact Africa, the funder and founder
of the Shared Value Africa Initiative,
assists clients to relook their operational
strategies and identify the social issues
that is holding current progress back and
work together with Clients to develop the
social impact strategy that works for them.
Making system changes, relooking
operating models, and revisiting exorbitant
profit margins can be the system changes
that can come out of Covid-19. What we
need in the future are purpose-led leaders
who can create economic value and value
for society.
Tiekie Barnard is the Chief
Executive Officer and Founder
Shared Value Africa Initiative
(SVAI). You can commune with her
on this or related matters via emal
at: [email protected].
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