Joerg S. Hofstetter, KEDGE Business School, France
Anita M. McGahan, University of Toronto, Canada
Brian S. Silverman, University of Toronto, Canada
David B. Zoogah, Xavier University, USA
Sustainability and Global Value Chains in Africa
There is increasing interest in economic growth and sustainability in African countries (Africa Report, 2011). The escalation of social, political, and ecological problems on the continent since the end of the 20th century (Neff, 2007; Zoogah, 2013) has been accompanied by commensurate escalation in the continent’s potential to contribute demographically, politically, socially and economically to global prosperity (Africa Report, 2011). While environmental, social and economic performance of most African nations and companies are below the levels of other world regions, the continent has the youngest average age among all on the planet, and is a focus of global investment and development. As a result, the Agenda 2063 and the Africa Continental Free Trade Area (AfCFTA) seek not only to harness the large market size of Africa but also to establish mechanisms that enable African economies to create enabling environments that support vibrant businesses without harming people and the natural environment. African conceptualizations of prosperity itself can provide a template for innovative business and public policies that can shape new approaches to development for both the private and public sectors. Engagement of all sectors is critical to the achievement of economic goals, such as those expressed under AfCFTA (Ghadge et. al., 2019) and as the UN Sustainable Development Goals under the UN Global Compact. Private-sector organizations – including corporations and non-governmental agencies – working together with representatives from all levels of government -- highlight the important role of Africa in scaling sustainable solutions to the most pressing problems in the world today.
Global value chains (GVCs) and, in particular, the procurement practices of companies sourcing in Africa, are shaping environmental practices and, therefore, sustainability of labor practices and environmental impact in Africa (Gibbon & Ponte, 2005). Western companies, for example, use defined supplier codes of conduct regarding labor and environmental practices to improve working conditions, product quality, and environmental impact of African suppliers, thus making these suppliers competitive globally (McGahan & Distelhorst, 2019). Through such actions, procurers around the world have the potential to mobilize collective action with other companies or government bodies to improve sustainability. However, as Taglioni and Wrinkler (2016) indicate, African nations view GVCs as potential traps that create a new core-periphery pattern with “good” jobs in the North and “bad” jobs in the South (World Bank, 2020). Another challenge is that many African businesses lag behind in measuring, reporting, and addressing sustainability concerns, issues, and problems. In Kenya, for example, only 0.05 percent of all registered businesses in the country are accounted for in the national Global Compact Network – even though the country is strong in exporting to Western countries.
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