investing in livelihood and enterprise development
TRANSCRIPT
Investing in livelihood and
enterprise development
By Philipp Essl
19 January 2015
BG case studies on strategic social investment
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Certain statements included in this presentation contain forward-looking information concerning BG Group plc’s strategy, operations, financial performance or condition, outlook, growth opportunities or circumstances in the countries, sectors or markets in which BG Group plc operates. By their nature, forward-looking statements involve uncertainty because they depend on future circumstances, and relate to events, not all of which are within BG Group plc’s control or can be predicted by BG Group plc. Although BG Group plc believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Actual results could differ materially from the guidance given in this presentation for a number of reasons. For a detailed analysis of the factors that may affect our business, financial performance or results of operations, we urge you to look at the “Principal risks and uncertainties” included in the BG Group plc Annual Report & Accounts 2011. Nothing in this presentation should be construed as a profit forecast and no part of this presentation constitutes, or shall be taken to constitute, an invitation or inducement to invest in BG Group plc or any other entity, and must not be relied upon in any way in connection with any investment decision. BG Group plc undertakes no obligation to update any forward-looking statements.
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About BG Group
• Market leader:
– FTSE top 25 company
– Listed on London Stock Exchange
– Market capitalisation
– Circa $ 45 billion
• Two highly distinctive capabilities:
- World class exploration
- Unique LNG model
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Deepsea Metro I drill ship
Where we work
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BG approach to strategic social
investments
• Country-level approach, supported by corporate guidelines &
expertise
– Alignment with local/national development & BG business objectives
– Projects based on 3-5 social investment strategies and annual work
plans
• Focus areas: livelihoods & enterprise development, vocational
training, and STEM education
• Prior assessments to understand local context – development
needs and constraints (e.g. socio-economic baseline, etc.)
• Delivery through expert partners (international & national NGOs)
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Case study 1
Livelihoods development project
in Bolivia
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Business and community context (I)
• Since 2000, BG Group in
Bolivia operator of gas
operating plant with 6
integrated, on-shore gas
fields
• Local footprint communities
with little livelihoods options
(only fishing)
• Strong dependency on
external support (NGOs)
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Business and community context (II)
• Difficult company/community
relationship
• Ad-hoc charity to respond to
local expectations with
limited, long-term benefits
• Continued pressure locally
and nationally to
demonstrate contributions to
broader local development
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Shift in community investment
approach
In 2009/2010, decision to apply more strategic approach to social
investment
– Participatory baseline study to strengthen understanding of local
context
– Joint identification of development priorities for BG support: local
economic development to support family incomes, as well as
local institution building
– Company and community relationship strengthened through this
process
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Launch of “value chain development”
project with NGO
• “Honey/beekeeping” identified, based on strong competitive
advantage
• Objective & beneficiaries: “develop sustainable source of
household income for families in local footprint area”
• Activities: capacity building along entire honey value chain
(production, processing, and commercialisation)
• Focus on measurement: production in kg; cost in $, sales in kg & $
• Capacity building of local institutions part of the project
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Honey production
1145 producer household (’14) Total production (’14): 6,200kg
Commercialisation
12Total revenues 2014: 20,000 USD (~10% ROI)
Launching the brand “Weenhayek”
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Case study 2
Investing in entrepreneurship development
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Youth entrepreneurship development
– the business case
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Country perspective:
Youth unemployment and lack of
opportunities key political and
economic challenge
BG Group perspective:
Strong community expectations
regarding job and enterprise
opportunities business risks
Shared value proposition:
Supporting enterprise & job creation, benefiting
BG’s supply chain and/or broader economy
Global, strategic partnership with
Youth Business International
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Support youth (<35 yrs.) to
create new businesses and
subsequently jobs
Strong focus on M&E to
understand what works
KPIs: #businesses, #jobs, etc.
Training
Mentoring
Access to finance
Delivery by local YBI network
member organisation, with
international YBI oversight and
capacity building support
Objective & beneficiaries Measuring results
Activities/services Approach
Projects in Canada, Kenya, Tanzania, and Trinidad
Supporting creation of new, youth-led
businesses in Kenya
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• 366 youth and community members
reached through outreach events
• 172 youth trained
• USD 28,905 distributed in loans
• 30 new businesses started
Objective & focus: Support alternative
livelihoods among coastal communities in in
Mombasa
Results after 1 year:
Back Up
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Lessons learnt
• Convincing communities to invest strategically can be challenging – but indispensable in order to deliver sustainable benefits
• Good understand of local socio-economic and political context important for design & implementation of strategic social investment
• Social investment process has contributed to a “partnership-like” relationship between communities and BG
• Building institutional capacity among communities (e.g. associations) can complement and leverage development support from public institutions
• Many challenges/risk remain: dependency on BG support, “political hijacking” pf community investments, and managing intercommunity tensions
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Youth entrepreneurship development
– the business case
• Unemployment and lack of economic opportunities among youth
key challenge across many BG host countries & communities
• Key community expectations vis-à-vis BG Group relate to job
and/or enterprise opportunities
• Contributing to broader youth-led enterprise growth and job
creation (direct and/or indirect), of direct benefit to BG business &
supply chain, as well as to broader economy
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