By Imunganda Malikana
The startup ecosystem in Zambia faces numerous challenges, including regulatory hurdles, limited infrastructure, market access, and skills gaps. If you’re running a startup in such an environment with the goal of raising funds and scaling, there are certain terms and concepts you should be familiar with, particularly in relation to your business. One of these key terms is ESG (Environmental, Social, and Governance) frameworks.
Gone are the days when financiers and institutions were solely focused on profit maximization. Nowadays, they want to understand how conscious your business is of its environmental impact and whether it is taking steps to be environmentally friendly in its operations and policies (the ‘Environment’ aspect of ESG).
They also want to know how your business is contributing to improving the lives of the community and addressing poverty (the ‘Social’ aspect of ESG).
Additionally, they want to work with entrepreneurs who prioritize transparency and have a clear understanding of how their company is governed and how it responds to unethical practices (the ‘Governance’ aspect of ESG).
As an entrepreneur, it’s crucial to have well-thought-out answers to these questions, especially when engaging with the corporate community. International organizations are increasingly unlikely to collaborate with startups without a clear understanding of your business’s impact on the environment, society, and its commitment to compliance.
