Are your contractors managing the social impacts of their activities?
Every day there seems to be another example of the challenges of managing the social performance issues associated with large capital infrastructure projects. Many project operators have to navigate the complex dynamics of communities impacted by such projects, labour disputes, issues of human rights and the use of increasingly precious water, land and other natural resources.
In addition and increasingly, host Governments are enforcing more stringent local content requirements on project operators in an attempt to capture greater socio-economic benefits. However, not all local suppliers have the capabilities of large international contractors and so the challenge becomes balancing local content requirements with high health, safety, environment and social standards. The unfortunate truth is that a project operator will only ever be as good as the poorest performing contractor in their supply chain.
The business case for a more cohesive approach between operators and contractors has been well documented. A 2011 executive briefing entitled ‘Shared Value, Share Responsibility’ by the International Institute on Environment and Development (IIED) clearly articulates both the challenges and actions required to improve performance in this area. IIED looked to the 2010 Macondo incident in the Gulf of Mexico to demonstrate the enormous impacts which poor contractor management and supply chain coordination can have.
Whilst some might continue to argue that alignment on social performance issues between project operators and contractors is a ‘nice to have’, I believe it is essential. After all, owners can ill afford projects that suffer cost and schedule over runs (or stop completely) as a result of community unrest – particularly when margins are so tight to begin with. Getting it right from the outset has never been more important.
As a colleague recently reminded me, ‘social performance management is not core business, but it must be core to the business’. I believe this sentiment also lends itself to the supply chain. Just as a contractor’s health and safety performance is fundamental to a successful operation – whether drilling an exploration well, building a process facility or shopping center, or constructing a road – so too is their ability to understand and manage the social impacts and opportunities which come with that activity.
At Kina we understand that each operation and project will bring unique challenges that require unique solutions. There is no ‘one size fits all’ approach that will bring about alignment and cohesiveness, but we offer a range of tools that can help both project operators and contractors better manage social challenges. We help our clients prepare for and manage the social risks inherent in their supply chains but we also passionately believe in building capacity within the supply chain – helping local suppliers enhance their social performance capabilities. This is good business and ultimately can only lead to better outcomes for project operators, contractors and host communities.
Trina Fahey, Partner
What we are up to & News
Joël Rault joins Kina’s Advisory Board
We are thrilled to have Joël Rault, Chairman and Founder of Hermès Advisory, join our Advisory Board. Joël has previously served as an Ambassador Extraordinary and Plenipotentiary for the Government of France and has extensive experience in administration and the management of private companies. He is also an emerging leader of the Harvard Kennedy School. We are looking forward to having his advice and guidance as we forge ahead with advising companies operating in Africa on Sustainability. For our full press release, ‘click here’
Invest Africa Ltd’s Webinar On Renewable Energy Solutions in Africa
Join our Managing Director, Rosalind Kainyah MBE, as she moderates Invest Africa’s webinar on Renewable Energy Solutions in Africa – Covid19, Sustainability & the future of the continent with Jennifer Boca of Lekela Power, Mansoor Hamayun of BBOXX and Scott Mackin of Denham Capital. They will be looking at whether investment bodies will have to pivot away from renewable energy assets in light of COVID-19; how renewable energy operations have been affected by the virus; the multilateral funds such as AfDB’s SEFA play in renewable energy developments across Africa; and the importance funds should place on ESG standards in the investment decision?
Date: Wednesday 6 May 2020. Time: 12:00-13:00 BST
Kina Advisory is proud to be an event partner of DLA Piper – Africa Week 2019
On the 28th November, Kina Advisory is proud to be an event partner of DLA Piper – Africa Week 2019. The theme for the day is“Africa: the future of trade and investment” and will be facilitated by Lanre A. editor of Nurmara and former editor of This Is Africa at the Financial Times and African Business. Our MD Rosalind Kainyah MBE will be moderating a session in the afternoon on: “Developing sustainable energy and natural resource projects: Implementing ESG in practice” | The panel will be made up of Jack Cunningham – Sustainability, Policy & Risk Director, Gemfields, Rhys Davies – Partner, DLA Piper, Chris Goodwin-Hudson – Founder, Watchman & Carla McRoberts – Managing Director, Veracity Worldwide | For a full breakdown of the day click here:
Rosalind Kainyah MBE will be chairing the 5th Africa Oil Governance Summit
Rosalind Kainyah MBE will be chairing the 5th Africa Oil Governance Summit on the 22nd & 23rd October 2019 & facilitating the 1st panel on “Value addition to petroleum resources extraction through industrialization: The possibilities and the challenges”. For a full break down of speaker & agenda, click here.
Africa | Attracting a New Wave of Investors
Rosalind Kainyah our Managing Director will be moderating a panel discussion for Invest Africa & DLA Piper on Wednesday 25th Sept 2019. The Topic: Attracting a New Wave of Investors: Corporate Governance and Meeting International Standards | For the full details of who’s on the panel and focus points, click here.