A2.5.5.5 Other opportunities from community development and environmental products
Other opportunities exist to bring value to both business and society.
Community development
Companies have for some time recognized the need to ensure surrounding communities develop as a result of setting up a company’s operation, for example by the building of schools, hospitals, roads or water facilities. What began as philanthropic gestures made to aid pet causes have since evolved into targeted interventions to address fundamental community needs and assist business objectives. This is not to say that company owners and executives do not still fund their special interests or make philanthropic contributions — only to point out that many businesses have recognized the strategic importance of community development and have exploited the opportunities that exist to improve their overall performance. Brand value & reputation benefits most from community development, but we found benefits in all the business success factors, especially revenue generation. The creation of special community development departments and/or foundations by many companies, particularly those in the extractive industries, has permitted the scaling up of strategic actions designed to optimize positive returns for both the community and the business.
There is also evidence of community development helping to reduce costs as well as risk. For example, where there are large mining or exploration projects that may displace people and adversely affect their livelihoods, companies that work to affect local social and economic development positively may find it easier to win a local license to operate and to reduced delays and contain the costs of the project.
Environmental products & services
There is a growing market for products and services that provide environmental benefits. It includes niche markets for environmental infrastructure and pollution abatement technologies, such as water supply, waste management, soil remediation, air and water pollution control, and other established environmental technologies. A distinct niche focuses on the growing demand for eco-efficiency, including industrial products and know-how which reduce the use of energy, water and other resources in production processes. There are also green niches of established industries that provide alternative ways of meeting market needs, such as renewable energy, sustainable agriculture, forestry and fisheries, and eco-tourism.
Products and services based on environmental considerations — from the raw material extraction to disposal — potentially command a price premium while also catering to the needs of specific target markets.
Creating an environmental product or service needs to be based on a coherent strategy which will embrace a company’s entire operations and possibly business partners. In some cases such a strategy has been adopted by small enterprises following new business models that explore new opportunities and needs of customers around the world.