The turmoil in northern Mozambique has thrown a spotlight on the sustainability and ESG efforts of international oil companies (IOCs) in Africa. Historically they have not had the most constructive relationships with governments and native communities.
Often the emphasis on developing or integrating local companies and people into the supply chains or operations of these large extractive projects can be wrapped up in temporary CSR missions and not built into the longer-term frameworks of national development agendas or company vision statements.
In doing so, this improves the understanding of their operating environments, lowering their costs of procurement and building capacity and capabilities of enterprises and individuals. And crucially, this improves the economic prospects of the host country, reinvesting in human capital and improving the social economy.
Increasingly this is being implemented as the industry takes on more responsibility and some of these concerns are addressed by local content regulation – which aims to increase opportunities of local businesses in these value chains. However, this is only the starting point.
Before projects are established, it is essential that IOCs and the public sector establish clear metrics, promoting participation of locals, to monitor and evaluate against over the project duration.
This is where the guidance of experienced partners like Invest in Africa, who have cut their teeth in these industries, have a clear vision of what local sustainability means and how best to implement considered ESG strategies.
Read more of Invest in Africa Director William Pollen’s thoughts in his thought leadership piece for Environmental Finance here: https://www.environmental-finance.com/content/analysis/big-oil-needs-big-change-to-its-sustainability-approach-in-africa.html