Saturday, September 19, 2009

BoP Business Development and the Extractives Industry

An article from NextBillion.net addressing the challenge of whether BoP business development and the extractives industry are compatible, since BoP business development by definition-if you accept co-creation as a key tenet-should engage the community in the process from the outset. However, extractives projects can be scoped, planned, funded and largely executed before the community is involved in a meaningful way.

The author, Tayo Akinyemi, thinks that in most of the cases the answer is probably "no", since most extractive projects are structured in a way in which investors and the management team ultimately control how the business is built while co-creation assumes that all relevant stakeholders are involved from day one.

My view and experience is that this is not neccessarily so and that many productive processes are only born after the community has also agreed to let such investments to happend on condition that the extractive company contributes to business co-creation. This is achieved on many cases, through the creation of a parallel "social" project, i.e. a development foundation, local investment enterprise, etc.

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