ECUADOR - Economy
Co-Founder, B Systems Ecuador
Sandra Reed is a lawyer at the renowned firm Pérez Bustamante & Ponce. She has a long track record of advising clients on some of the most important and challenging project finance, public-private partnerships, joint ventures and acquisitions in the infrastructure, alternative energy, technology and real estate sector that have taken place in Ecuador over the past 20 years. One of her most representative cases is her long-term relationship with Corporación Quiport, advising on all legal aspects related to the concession, planning, negotiation, financing and implementation of the New Quito International Airport project.
We are developing in the way that the world as a whole is developing. I have been working with sustainable issues my whole life, either from my profession or through different pro bono work that I have done all my life. when I started out, I was quite young, many thought that our concerns were rather crazy, while today the picture is different. Just recently, I had a tough board meeting with a company that had never considered sustainability. One of the shareholders vocally insisted, “I want investment in areas of systems sustainability, I want you to take care of the community, work on energy, and deal with waste, etc.” This is an amazing transformation. So, yes, this has been a worldwide development, and Ecuador has not remained on the sidelines. You will have some companies that remain with the old way of thinking. But true pioneers will need to include such considerations in their activities. Fewer companies will simply wish to distribute dividends and leave it there.
There’s no doubt that you generate a return. For example, energy becomes cheaper. And regarding employees, if you pay well and take care of their basic needs and treat them well, they will certainly deliver more. And concerning the wider community, it also has a great impact, for example at the Quito International airport where I spend a lot of my time as a lawyer, we have strict social and environmental policies, this started when the project was funded with money from international banks and multilaterals, and remained as part of its culture The airport takes care of all kinds of social and environmental issues. And as a result, during the riots in Ecuador, it was ordinary people of the local community around the airport who protected it from damage. The only companies of the flower industry, in certain areas of the country that were not attacked during the riots were those that were certified as B corps. Why? Because their employees have that fidelity attachment to the company, and know that it is good for them, therefore they must work well and protect the company, and the environment. This is a lifetime awareness, and when tough times come, it pays double.
Sistema B International has been working for 11 years with B lab. The movement is based on the believe that capitalism and companies are good and have a great impact, therefore they must be good for the environment, the community, its workers, and all stakeholders. And based on this, the concept was born of assessing one’s impact on the environment, on the people that work with you, and on the community. Then, the notion of responsibility concerns not only the investor, but the consumer. Simply undertaking a self-evaluation makes a significant difference, regardless of whether it leads to certification. Evaluation confirms an awareness of the importance of doing well in different areas. Therefore, the general concept of a B Corp is ‘be a better company for the world.’. The payoff is that investors and consumers prefer you. And even if you don’t get certified immediately, because the standards are so high, while working in solutions to the issues found you are being a better company, we’re assisting you to understand where you stand, this is a plus that B System give.
In the beginning it was small companies—and it’s much easier for a small company to do so. But now we have large corporations such as banks, an example being Produbanco certifying as a B Corp, which is amazing. It is the first bank in the region to have done this, because it requires considerable compromise and effort, that involves the entire organization from the shareholders to the board of directors, the CFO and CEO and all the employees. And naturally, the bigger the company, the bigger the impact. By scale, we have a wide range of companies at different stages applying. We are finding greater public awareness of their impact. I am a lawyer in PBP the largest law firm in Ecuador and we worked to that same strategy. We work with all types and sizes of company in the B Corps system. We worked more with small companies wherein entrepreneurs and young people were keen on the merits of the system. But when you have CEOs or shareholders who are in their 70s and are keen on becoming B Corps, it marks a major sea change. We are at that point right now, where we see that the companies that will remain in the market are those with a 360 degree approach. They don’t just look at the business and how much is sold versus the cost involved. They look at the impact on the community, on stakeholders and employees. Nowadays it is more difficult for somebody to say I don’t care. On top of all taking care of the impact and being certified as a B corporation pays back, it’s a smart business decision, that is the key to why this will continue to develop in the right direction: “be a better company for the world.”
ECUADOR - Energy & Mining
General Manager, Electric Corporation of Ecuador (CELEC EP)