W abv.org.au E info@abv.org.au T +61 2 6151 9999 STRENGTHENING BUSINESSES AND, THROUGH THEM, COMMUNITIES The launch of Pacific RISE, an Australian Government social impact investment initiative being delivered by Coffey and ABV CONTENTS 1. Building a portfolio of private sector partnerships 2. Due diligence regarding private sector partnerships 3. PanAust Partnership: Planning for change in remote northwestern Papua New Guinea 4. Newcrest Partnership: Benefiting the community while contributing to a social licence to operate 5. Coffey Partnership: Delivering the Australian Government initiative Pacific RISE 6. Bank of the Philippine Islands Partnership: Helping design a community immersion program and building the capacity of agricultural co-ops BUILDING A PORTFOLIO OF PRIVATE SECTOR PARTNERSHIPS With 30 years experience building shared outcomes for business and the communities in which they work, our ability to work with the private sector and to leverage private sector investment is a key ABV strength. As friends of ABV may be aware, over the last year our activities have been funded or supported in-kind by corporations including The Body Shop International, Highland Products Limited, Virgin Australia, and of course IBM. These private sector partnerships are in addition to projects being delivered via other non-traditional sources including the, Bank of PNG, Department of Finance of PNG, GIZ, Pacific Business Investment Facility, Pacific Islands Trade and Invest, PNG Women s Chamber of Commerce, and the Provincial Government of East New Britain. Our partnership program has cranked up even further recently, and we have now established a number of important new collaborative agreements. With this in mind the first article in this issue of Perspectives discusses our due diligence process, the steps we take to ensure that our partners align with our mission and values. Other articles outline several of our new private sector partnerships including with miners PanAust and Newcrest, with Coffey and with the Bank of the Philippine Islands. We also have several new projects in the design phase and we will share the details once they are rolled out. All these new partnerships mean it is an exciting time at ABV, yet we are remaining true to our vision - to alleviate poverty by using business expertise to drive inclusive economic growth and wellbeing. Sarah O Connor CEO
2 DUE DILIGENCE REGARDING PRIVATE SECTOR PARTNERSHIPS In recent years ABV has emphasised the diversification of our funding sources, in particular through engaging with business. Whether it is for the purposes of corporate social responsibility, to maintain a social licence to operate, or due to a shared value-based business strategy, corporations are increasingly interested in working with not-for-profits to benefit the communities in which they work. As ABV explores opportunities with the private sector we are conscious of potential risks associated with such partnerships, and therefore aim to follow best practice for development sector collaborations with business. In our volunteers ABV is lucky to have access to a pool of people with expertise in these matters, and with the assistance of a number, ABV was able to develop a rigorous due diligence process. This process is instigated by the CEO early on in discussions with potential partners. The process helps us to build an understanding of the potential partner s policy and cultural compatibility with ABV, as well as their reputation and policies with regards to the environment, health, safety and social responsibility. Whether a business is an appropriate partner depends on a variety of factors. An overarching consideration is whether the business is involved in activities, countries, governments, sectors, or customers that would cause a reasonable person to believe that ABV is acting inconsistently with our mission and values. Further factors we consider include, among others: the activities the business is involved in focused on assisting the community, whether the business has a good reputation, especially in areas of corporate social responsibility; and the business plans for the prevention of environmental accidents. In addition, to ensure that ABV becomes aware of issues that may arise we maintain a watching brief over the life of all our partnerships. With this process we believe we are striking the right balance, considering and investigating risks while enabling us to move forward in our policy of private sector engagement with confidence.
3 PANAUST PARTNERSHIP: PLANNING FOR CHANGE IN REMOTE NORTH-WESTERN PAPUA NEW GUINEA Given the significant presence and impact of the extractives industry on the countries in our region, ABV has begun to partner with the sector to support their community development programs. While always undertaking rigorous due diligence, ABV takes the view that by keeping community interests at the centre, ABV can add value to the design and delivery of resource sector programs and maximise community benefit. ABV volunteer Anthony Sim (third from right) with Sokomin men during a community visit In late 2016, ABV began working with Brisbane-headquartered copper and gold producer, PanAust. PanAust supports community development initiatives at its operational and major exploration sites with the goal of helping local communities to develop sustainable socio-economic livelihoods that will continue beyond the life of the mine. In November 2016 two long-time ABV volunteers Christina Raddatz and Anthony Sim, choppered into the Frieda River region of Papua New Guinea (PNG) for a three-week scoping assignment. In this mountainous and remote area in the north-west of the country, PanAust is currently in the pre-development phase of its Frieda River Copper-Gold Project. As part of its community outreach process, PanAust is working closely with the local landowners so that they are included in, and benefit from, the project. Anthony and Christina s role was to undertake a preliminary assessment of the potential for small business development projects focused on assisting landowners in villages close to the Project. Over a very busy three weeks the two volunteers visited 12 separate villages conducting meetings and interviews with community leaders. The result was a report on the prospects for small business development in the communities within the project area. The report includes information about potential business opportunities, existing business facilities in the area as well as recommendations about business training requirements. The Frieda River Copper-Gold Project is still in the planning stages and is yet to be approved by the PNG authorities. However, if and when the project goes ahead, this report will be a valuable tool when working with PanAust on the design of a long-term community development plan. Money is like your child, you look after it, help it to grow until it is able to look after itself. Abris Kabilengim, Women s Community Leader, Ok Isai, West Sepik Province PNG, 4 December 2016
4 NEWCREST PARTNERSHIP: BENEFITING THE COMMUNITY WHILE CONTRIBUTING TO A SOCIAL LICENCE TO OPERATE In February 2017, Nick Gorshenin and Shane Wise flew to the Indonesian island of Halmahera to conduct a scoping project associated with PT Nusa Halmahera Minerals Gosowong gold operation. PT Nusa Halmahera Minerals (NHM) is an Indonesian company majority owned by ASX-listed miner Newcrest. ABV is partnering with the Newcrest given its approach to building enduring relationships with host communities based on recognition and respect for human rights, trust and active partnerships. Newcrest believes that community engagement and development is critical to maintaining the company s licence to operate and ensuring that communities benefit from its operations. Based on existing reserves, it is estimated that mining at Gosowong will continue for several years, subject to a variety of economic and operational factors. At the same time, the miner is committed to working with the community to plan for eventual closure, with a key aim being to assist the local community build selfsufficiency regardless of the mine s future. A strong small and medium enterprise (SME) sector is widely understood as an important contributor to sustainable economic growth. Following dialogue with Newcrest and community representatives ABV designed the scoping assessment which was undertaken by Nick and Shane. The goal of the study was to identify opportunities to sponsor sustainable SME development and assist in community training, particularly amongst young people and women in the villages closest to NHM, as well as in the North Halmahera region generally. During a busy six week period Nick and Shane engaged with the mine s CSR team, with many community leaders, university lecturers and other stakeholders, while also visiting local and regional markets and ports and government offices. The resulting report provides recommendations about SME capacity building in sectors including integrated farming, fisheries, and tourism, as well as other initiatives that might lead to SME development in the region outside these core areas. Importantly the report also provides a number of recommendations about areas in which Newcrest can design and provide programs within the community, as well as areas which business volunteers could contribute, and so will also provide the basis for future potential ABV assignments in the area. Sofifi fish markets, one of the many Halmahera markets visisted by Nick and Shane during their scoping study
5 COFFEY PARTNERSHIP: DELIVERING THE AUSTRALIAN GOVERNMENT INITIATIVE PACIFIC RISE In January this year the Australian Government launched an innovative pilot program to improve economic development in the Pacific region - Pacific Readiness for Investment in Social Enterprise. Known as Pacific RISE, the program is an initiative pioneering and facilitating a social impact investment market across the Pacific. Pacific RISE will introduce $5 million of new private investment capital into the Pacific over the next three years. Gender lens investing will be emphasised under Pacific RISE, an Australian Government initiative delivered by Coffey & ABV ABV is proud to be partnering with international development management experts Coffey to deliver this initiative on behalf of the Australian Government. In many Pacific countries, economic growth is not keeping up with population growth. To support Australia s neighbours progress, new and innovative solutions leveraging more effectively the drivers of development particularly the private sector and women need to be considered. Impact investing is one such innovation. Impact investments are those that look beyond the financial return. They aim to deliver measurable social and environmental impacts. In creating an impact investment market Pacific RISE will establish private sector partnerships made up of investors, intermediaries and Pacific based businesses. These partnerships will link finance and ideas to achieve social and economic development outcomes, particularly for women and girls. An important element of the initiative is the use of gender lens investing which incorporates gender throughout the financial analysis to improve investments and promote equitable social change. ABV has implemented nearly three thousand volunteer assignments in the Pacific from Papua New Guinea to the Cook Islands since the early 1980s, and has designed scores of successful social enterprise capacity building projects across our region since the early 2000s. As Pacific RISE moves forward ABV will harness its in-depth knowledge of the Pacific and of social enterprises to assist Coffey in the delivery of the program to support the Pacific s economic development.
6 BANK OF THE PHILIPPINE ISLANDS PARTNERSHIP: HELPING DESIGN A COMMUNITY IMMERSION PROGRAM AND BUILDING THE CAPACITY OF AGRICULTURAL CO-OPS In late 2016 regular ABV volunteers, Earl Dacanay, Mark Greenshields, Matt Stone and Dante Tagle spent a busy several weeks on the Philippine island of Negros working alongside bank employees as part of a corporate community engagement program. Once on the ground in Negros Occidental Earl, Mark, Matt and Dante assisted in the scoping of the needs of the cooperatives, trained BPI corporate volunteers in capacity building, and provided mentoring and support to both BPI employees and co-op members. The BPI employees focused on providing co-op members with training in financial literacy, particularly savings and investments, and asset management. They also reviewed and recommended changes to strengthen financial systems, controls and policies. ABV volunteer Mark Greenshields (C) with BPI staff Aware of ABV s expertise in designing corporate programs which benefit communities, corporates and employees, the Bank of the Philippine Islands (BPI) contracted ABV to assist in the delivery of its 2016 Social Immersion Laboratory program (SoIL). BPI provides a variety of volunteering opportunities for its employees, but SoIL is specifically intended for senior executives. This SoIL program saw employees placed with three local agricultural co-ops in Negros Occidental province on three week assignments. ABV s role was to assist with initial scopes of work, to design a monitoring and evaluation framework to capture information about outcomes for employees and the co-ops, and to provide volunteers experienced in community level capacity building to act as facilitators. Rural areas of the Philippines have much higher rates of poverty and social disadvantage than metropolitan areas. With agriculture the major employer, agricultural co-ops are an important means of sustainable and equitable wealth creation in rural areas. However as co-op managers are often lacking in business skills, there is a widespread need for capacity building programs to generate efficiencies and to enable these co-ops to take advantage of business opportunities. Measured against the framework designed by ABV the program was a resounding success and has the potential to generate genuine long-term outcomes. BPI employees reported high levels of satisfaction, one employee for example saying by far, it has been my most meaningful three weeks. In addition BPI employees contributed to changes in co-op strategy, finances and management which have real potential to generate a measurable increase in agricultural production and yields over the next few years. For ABV the program was beneficial as it enabled us to test ways of combining the expertise of ABV volunteers with the specialised skills of corporate employees. Corporate employees can usually only participate in such programs for short periods, and combining their inputs with multiple ABV volunteer inputs we can contribute to strong outcomes-focused programs. We thank you for your commendable guidance, Earl. We would have not been as productive as we wanted to be had it not been for your superb support. We learned a lot from you. By far, it has been my most meaningful 3 weeks. Ritche Farinas, BPI
7 Snapshots from recent private sector partnership assignments in Indonesia, Papua New Guinea, and the Philippines
AUSTRALIAN BUSINESS VOLUNTEERS Among international development NGOs ABV is unique in its focus on strengthening business and economic institutions with a vision of alleviating poverty through inclusive economic growth. ABV s private sector focused development projects are impactful and costeffective because they are implemented by volunteers drawn from its registry of senior business professionals and small business owners. Our volunteers bring extensive experience to each project along with an independent and altruistic approach that guarantees effective and authentic skills transfer and mentoring. ABV is a proud member of the Australia PNG, Australia-Pacific Islands, and the Australia-Fiji Business Councils Shared Value is the new term for how we ve been working for the last 30 years. We have always engaged the private sector and leveraged private sector investment to create shared outcomes for businesses and communities. With long-term experience implementing capacity building programs using different models, ABV collaborates with our partners to create effective programs which are customised, needs-based, and community driven. PO BOX 207 Civic Square ACT 2608 AUSTRALIA web abv.org.au email info@abv.org.au phone +61 2 6151 9999