Exploring the Green-BoP Nexus Pt. 2: Businesses Bridging the Divide
Last week, I discussed the rift the Tata Nano has exposed between environmentalist and poverty-alleviation focused professionals, academics and activists – a car that at once represents aspirations of new material wealth for millions of BoP consumers and a potentially enormous source of new CO2 emissions.
But there is another story worth telling here – far away from the Nano controversy, out in the rural Yunnan province of southwestern China, there is Hao Zheng Yi. Transportation issues may not be the first thing on peoples’ minds here since, as I’ve reported previously, one fifth of China’s rural population lacks access to electricity. Without reliable energy infrastructure, 80% of people in these regions rely on biomass for heating and cooking, burning wood and straw in ovens as a primary energy source. The negative implications of this practice blur the line between environmental and social concerns, touching on issues of deforestation as well as health problems arising from the indoor air pollution generated by smoke.What if, Hao Zheng Yi thought, there were a technology that could address this full range of problems and be affordable enough to reach scale in a BoP market? Hao founded Yunnan Zhenghong Environmental Protection Co. to do just that. His fuel efficient ovens use less than a fifth of the biomass required by conventional ovens – his goal is to bring these ovens to farmers and their families throughout rural China. In terms of the cost savings, the technology make good business sense, yet this solution also tackles a whole spectrum of environmental and social ills as a seamless part of its business model.
The importance of this and similar business solutions cannot be understated, because of course Hao is not the only triple-bottom-line oriented entrepreneur in China; the beauty of the marketplace is that we can constantly look ahead to the next innovation. Is there a way to distribute an even more efficient energy technology in rural China? Could solar-powered ovens be marketable in Yunnan?
These are the questions that drive us at New Ventures, which, for those who don’t know is the parent project of NextBillion.net. As part of an organization whose mission is to put forth solutions that protect the environment and improve people’s lives, we look for the entrepreneurs, the ideas, the innovations that seamlessly connect the well-being of our two most important stakeholders – people and planet. So we get past the nearly paralyzing complexity of the poverty-environment nexus by focusing our efforts where environmental and social goals meet, essentially working to promote the Zhenghong oven-type models of the world rather than the Nano models.
Some might think this is a cop out – I would disagree. I believe the interactions between poverty and environment should be carefully and thoroughly studied. But this space is large, and there are many people asking those questions. Our role is to focus in on the sectors and models where people, profit and planet are complementary. New Ventures achieves this by working in targeted sectors where these complementarities are clear, such as renewable/alternative energies, organic agriculture and water/sanitation.
What this means in practice is that within these target sectors, we are actively helping entrepreneurs with innovative technologies and products to grow and thrive as well as researching business models that have the potential to reach scale and transform conventional sectors (eg seeking out renewable energy models that replace conventional energy).
This also means that we need to be dialoguing like crazy with others in the sustainable development space, with the BoP, with NextBillion readers. We aim to discuss transparently and honestly the prospects and realities for sustainable and social entrepreneurship, about how realistically scalable companies like Hao’s are and the tensions between environmental and social impacts in the private sector.
So as you notice us writing about ideas and trends surrounding this Green-BoP nexus, I would encourage all of our readers to share their thoughts, whether you think sustainable development models that are good for the poor and the environment are a godsend or a pipe dream. We’ll look forward to continuing the conversation…