Good morning Ladies and Gentlemen. It is my great privilege to be here with you to mark the launch of the Safaricom Sustainability Report for 2014/15. First, my thanks go to Bob Collymore and to Safaricom for hosting, at what seems a particularly timely moment to come together to discuss these issues. The report makes very clear not only your ongoing commitment to sustainable business practices, but also your desire to share these practices with your business partners and supply chains.
That approach of partnership is I think important. The interlinked challenges and opportunities of sustainability can only be addressed by us taking shared responsibility. Shared responsibility – working together between Governments, the private sector and individuals. It is easy to think of sustainability is a box-ticking exercise, a bit of CSR here, or carbon-reduction there. But it is a lot more than that: it is critical to achieving inclusive economic growth, to equality and development. Your corporate strap-line is “transforming lives”. If this is to have meaning, then as Safaricom employees this report is the most important you will read this year.
To illustrate this view of the shared importance of sustainability, I would like to address three things this morning. I will say a bit about the important international milestones in 2015 and why they matter to us all, then how this relates to sustainable and ethical business in Kenya, and finally comment on the importance of ethics and values.
Internationally, 2015 represents a landmark year for global sustainable development. The Sustainable Development Goals (SDGs), successors to the Millennium Development Goals, were agreed in New York just a fortnight ago. December will see both the Paris climate negotiations under the UN Framework Convention on Climate Change, and the WTO Ministerial – to be held right here in Nairobi, a first for Sub Saharan Africa.
The outcomes of these meetings will set the international framework for growth for the next 15 years. The SDGs represent a commitment by World Leaders to achieve three extraordinary things by 2030: end extreme poverty, fight inequality and injustice, and tackle climate change. In Paris, leaders will meet to agree a new legally binding framework for CO2 emissions. Further climate change is expected to increase the frequency of extreme weather events. The annual cost of climatic shocks to Kenya alone is estimated at US$ 0.5 billion (about 2% of GDP). If not addressed, climate change will hamper progress towards Kenya’s aim of being a middle income country by 2030. As ever, the impacts will disproportionately impact vulnerable groups, especially women and those living in the arid and semi-arid lands and coastal regions. And at the WTO MC10, Trade Ministers will negotiate for freer, fairer trade - necessary to create jobs and livelihoods to bring people out of poverty.
These three events present a unique opportunity for all of us – Governments, the Private Sector and individuals alike – to seize upon this moment to finally bring an end to extreme poverty in our world. It requires us all to play our part. Kenya has played, and is playing, a leading role on the international stage. Through its Permanent Mission in New York, it steered Member States to the agreement reached at the UN Summit. It is leading the way in Africa on climate change with its ambitious climate change action plan, and investment in renewable energy. And Kenya’s role in hosting the WTO MC10 offers an unparalleled opportunity to push for a fairer trade environment, one that will allow Kenya and other developing and emerging economies to realise their export potential and support sustainable poverty reduction.
I’m also proud that my government is helping to lead the way internationally. The UK’s commitment to 0.7% of GDP for aid is now enshrined in law. Speaking last month at the UN Sustainable Development Summit, Prime Minister David Cameron spoke of the need to ‘leave no-one behind’. Put simply, to bring an end to extreme poverty we need to put the poorest, weakest and most marginalised first. You may have heard PM Cameron speak of a ‘golden thread of development’. In essence, this recognises that sustainable development requires a commitment to strong institutions, governance and the rule of law. Only by tackling conflict, insecurity and corruption can we hope to deliver genuine and lasting growth.
That is why our UK Department for International Development is increasingly focusing its support on wealth creation, empowering organisations like TradeMark East Africa or the Kenya Markets Trust to help ordinary Kenyans have access to markets, to drive job creation, skills development and an economic take-off that will benefit all Kenyans, not just a privileged few. In short, sustainable economic growth, driven by a strong private sector, is the most powerful engine there is to lift people out of poverty.
What does that mean for business leaders in Kenya, like Safaricom? You are showing that sustainable business practices in Kenya can – and must – go hand in hand with commercial success. That sustainability cannot be achieved in isolation. Your Foundation is having a huge impact on Kenyan lives. I would like for example to welcome the launch of the Safaricom technology challenge fund just last month. There are other companies doing the same. I’m proud that so many of those companies are British. Some of the biggest employers in Kenya are British headquartered, many are signatories to the UN Global Compact and the Voluntary Principles for Human Rights and business as well as other voluntary ethical business initiatives, and a large number are FairTrade compliant.
I would like to take this opportunity to challenge more businesses to join in their efforts. It isn’t just the right thing to do…it’s the smart thing. Looking after your workers is key to building the long term partnerships within your communities that you need to grow. Lowering your emissions not only saves the planet, it saves you money on your energy bills.
Take renewable energy. The UK’s International Development Minister and Minister for Africa Grant Shapps recently called for a clean energy revolution in Africa to end dependency on aid. A reliable electricity supply is one of the most powerful tools for helping people lift themselves out of poverty. Yet two out of three people in sub-Saharan Africa are currently living without electricity access. 20 years ago there was a nine month wait in Kenya for a monopoly provided land telephone line. Then Safaricom arrived on the scene. In just ten years we have seen a total transformation of the way in which Africans communicate - the mobile revolution. Why can we not demand a similar revolution in access to clean energy over the next ten years?
This will require Governments, investors and aid agencies to tear down regulatory barriers, and attract new finance. The British government is committed to growing this sector, domestically and around the world. The UK-supported Africa Enterprise Challenge Fund is already investing $25m in 32 private sector companies to deliver low carbon growth. The fund is being supplemented by US$ 20 million (Ksh 1.65 billion) to help private sector businesses in clean energy, agriculture and water management in the Arid and Semi-Arid Lands (ASALs).
The Private Sector has an opportunity to show the way in turning development challenges into business opportunities. Just as DFID and Vodafone/Safaicom did when partnering on a small innovation which became the Kenyan powerhouse that is M-PESA, we must put the private sector at the heart of these solutions.
Finally, the other aspect of sustainable growth that your report is right to identify is ethics and values in the business environment. This is the rule of law and governance strand of PM Cameron’s “golden thread”. Kenya’s Vision2030 has three pillars: social, economic and political. But people often forget that all three of these are underpinned by a fourth pillar: values. Those values are the software. Without them the hardware, and our shared goal of double digit growth, will not function.
A critical part of these values is addressing corruption. Let’s call a spade a spade: corruption is theft from Kenyans. I applaud Safaricom’s leadership in this area, last year dismissing 56 employees for corruption. I’d like recognise Bob’s personal commitment, as a member of the UN Global Compact, alongside KAM and KEPSA to promote ethical business practices. Of course, corruption is not unique to Kenya, far from it. It is a global problem that we must all work together to counter.
Whether you are a company, international investor, development partner or Government, our interests are the same: to create an environment which attracts investments, creates jobs, and helps to deliver a better life for all Kenyans. Corruption – much of it generated by the private sector - remains the key inhibitor to accelerated growth of business and economy. Corruption destroys public trust, undermines democracy and the rule of law, and creates space for organised crime. His Excellency President Kenyatta has made clear his resolve to tackle corruption, and this requires the support of everyone. Today’s event is a call to all of you to rise to the occasion; to make a public commitment; to act together to clean up the business landscape. Again, it’s the smart thing to do. Tackling corruption will allow the private sector to thrive, attract investment and ensure the benefits of economic growth are shared amongst all citizens.
More broadly, in line with Chapter 6 of the Constitution on leadership and integrity, we must ensure the values are in place to build a reliable investment climate in Kenya. This agenda involves issues such as streamlining processes for starting businesses, clarifying tax issues, ensuring work permits are quickly and efficiently issued, and tackling counterfeiting. This should see business in Kenya apply strong ethical standards in their operations - by joining responsible business networks, like Business Fights Poverty; complying with voluntary global initiatives, like the Ethical Trading Initiative, UN Global Compact, and the Global Reporting Initiative. And yes, we should maximise the use of local Kenyan content – sourcing inputs from Kenyan firms, hiring local staff, and looking for opportunities for Kenyan business to move up the value chain, leading to more and better jobs for poor people.
So, in conclusion, please don’t regard this report as a nice bit of environmental green-wash. Business and societies are interdependent. Be part of leading the way for responsible business in Kenya, for Kenya and Kenyans. Not selling airtime, but “transforming lives”.
I more than most know that it is dangerous and wrong for a foreign diplomat to try and tell Kenyans what the answers are. Those answers will come from within Kenya, not from outsiders. But if I was going presume to offer advice, it would be this. We must back the talent, ingenuity and resilience of the Kenyan people. We must be optimistic about Kenya’s courage and tenacity. We must help to make the case for stability and inclusive growth, and create a better climate for investment and jobs. We must all of us act together – Governments, the Private Sector and individuals – to ensure that no one is left behind.
You at Safaricom are proving that that is the case. Thank you, and congratulations on the launch of this report.