Oh sustainability, how I hate (and love) you!

Oh sustainability, how I hate you! But only on the days when I look at the world and feel despondent and think that we should be accomplishing so much more. We should achieve better and more visible results to improve the state of the environment. And don’t get me started on social responsibility and equality. I become discouraged because I am impatient. Fortunately, this happens rarely.

Oh sustainability, most of the time I love you.

I love to be involved in creating a more sustainable world. I have been working as an Environmental and Social Adviser at Finnfund for 2 months now. I knew that the organisation makes responsible investments in developing countries and makes them in a professional manner. But I did not know about the passion that goes into the work. Everyone works flat-out to make new sustainable investments.

Constant improvement…

I have also been delighted to see how carefully my colleagues working on sustainability do their job. No project is identical. At Finnfund, we always draw a detailed environmental and social action plan at the start of each project. This plan defines how we will improve the company’s sustainability during the investment period.

Finnfund requires its investee companies to comply to the Performance Standards of the International Finance Corporation (IFC) and other international best practices. Anyone who has lived in Africa or any developing country might find such compliance unrealistic. Corruption is rampant and nobody follows the rules and agreements anyway, not even the written ones.

Dialogue initiates change

That is not an entirely accurate picture. I have spent 13 years living in various African countries and can honestly say that even the good regulations are often not complied with. Corruption is also a real problem. Challenging operational environments and complicated bureaucracy often hinder business operations. For example, I managed a consulting firm in Tanzania for seven years, and during that time I became highly aware of the jungle of tax schemes small businesses are forced to navigate.

However, I have also seen how active dialogue can initiate change. When I was part of a value chain project that supported the cashew nut sector in the rural Tanzania, we were able to make the export of processed nuts a profitable and successful business thanks to research and dialogue with authorities. The engine of the project was a medium-sized company that processed cashew nuts, but the operation impacted the whole sector.

Leader companies make an impact

In addition to growth in productivity, I have also witnessed the role of forerunner companies as pioneers of sustainability. For example, when one production plant operating in the countryside documented the requirements and rights of labour and made them visible, smaller companies in the sector improved their working conditions. Working hours and occupational health and safety are not considered very important in all countries and local labour legislation lags behind international standards.

Therefore, it is important that Finnfund and other development financiers promote the growth and development of responsible companies. Finnfund finances significant forerunner companies in Africa and other developing countries. Financing is important, but equally so is the work we put in to improve environmental and social responsibility of the investee companies, which, in turn, leads to positive impacts that affect both the everyday life of people and wider society.

Päivi Michael
Environmental and Social Adviser, Finnfund

Päivi Lehtonen began working as an Environmental and Social Adviser at Finnfund in September 2020. Her previous jobs include Councellor at the Ministry for Foreign Affairs of Finland in South Africa and Development Consultant in Tanzania.

Päivi Michael Senior Environmental and Social Adviser paivi.michael@finnfund.fi