AfricaConnect – We finance progress

Companies that already meet high standards in the Better Jobs area that go beyond minimum requirements or that would like to implement these may receive more favourable interest rates or a grant. This is possible through one of the following measures.

Living wages

• Living wages allow employees and their families to enjoy a decent standard of living.
• This can be officially verified by means of recognised certificates such as SAI or fair wage. Alternatively, it can be calculated using the Roadmap on Living Wages developed by ‘IDH – The Sustainable Trade Initiative’ together with the AfricaConnect-Team. If required, an action plan is then drawn up to bridge the gap.

Certified working conditions

• High standards with regard to worker rights, treatment of employees, etc., can be demonstrated, for example, with the SA8000 and For Life certificates. This must go beyond what is required by law and AfricaConnect’s minimum social standards.
• AfricaConnect also supports occupational health and safety management systems that are certified according to ISO 45001, thereby ensuring high health and safety standards in the company.

Further training

AfricaConnect supports further training measures with a non-repayable grant. This includes courses that go beyond the mandatory education that employees need to do their current job. The grant can cover up to half of the costs incurred.

In Africa, as elsewhere, women are still at a disadvantage when it comes to economic participation. Young women in particular often have lower career opportunities, are paid less and work under less favourable conditions than men. AfricaConnect is committed to equal opportunities and empowering women in business. In addressing these issues, AfricaConnect relies on the 2X Challenge, a G7 initiative that aims to encourage development banks and the private sector around the world to invest in women. It provides the framework for supporting female entrepreneurship and management and, most of all, equal conditions for employment.

At least one of the following criteria must be fulfilled for a company to meet the 2X Challenge and be granted a lower rate of interest:

• Founder/owner: ≥ 51% female owners OR female founder
• Management: Women account for ≥ 20-30% of senior leadership (depending on the sector) OR make up ≥ 30% of the board
• Female employees: Women account for ≥ 30-50% of the workforce (depending on the sector) AND a qualitative indicator (e.g. Women Career Advancement Initiative, anti-discrimination directives, etc.)
• Products for women: Products or services that benefit women specifically or primarily

In the area of supply chains, AfricaConnect offers borrowers two different ways to secure a lower rate of interest. Socially and environmentally conscious standards along the supply chains can be verified through quality labels or membership of a supply chain initiative.

Quality labels

• Quality labels are affixed to products and give guidance to consumers choosing a product. To merit one of these quality labels, products must meet specified standards in environmental or social responsibility – either across the entire supply chain or at the production/raw material stage.
• Depending on the quality label, sector and product, 50-80% of sales revenue must be generated through products with quality labels.
• For example, AfricaConnect accepts fairtrade, Rainforest Alliance, FSC, Fair for life, Demeter and GOTS quality labels.

Supply chain initiatives

• Companies can join supply chain initiatives that require member companies to comply with specific standards along the supply chain. At the same time, they help companies to assess risks and implement fair and environmentally compatible supply chains. To receive an interest reduction from AfricaConnect, two thirds of suppliers with a high risk profile must be audited by independent auditors within the space of three years.
• For example, Sedex, BSCI Amfori and SAI (Sustainable Agriculture Initiative Platform) meet the requirements defined by AfricaConnect.

AfricaConnect aims to offer especially attractive conditions to companies whose investments help to limit the impact of global warming and who are actively involved in combatting climate change:

Renewable energy as a business model

• Expanding renewable energy plays a central role when it comes to climate neutrality. Notably in developing and emerging-market countries – where, in many cases, most energy requirements are still met by fossil fuels – climate-neutral energy systems still have a particularly positive impact.
• To help boost this positive impact in Africa, companies whose business models are based on expanding renewable energy are offered a reduced rate of interest. These include, for example, providers of renewable energy systems.

CO2 reduction targets

• To reduce the level of CO2 emissions in the long term, AfricaConnect wants to help companies to set ambitious long-term goals to lower their carbon footprint significantly by 2030 or to make their processes climate-neutral by 2050.
• Companies that sign up with the Science-Based Targets Initiative (SBTI) to achieve this goal and that follow the procedure defined there (including drawing up reduction targets and having them validated by the initiative afterwards) are given a reduced rate of interest after submitting their declaration of commitment.

Building measures

• Finally, changes to buildings or infrastructure can also help to reduce the carbon footprint, for example through photovoltaic installations.
• Companies can be eligible for a lower rate of interest if the measures that they introduce reduce energy consumption by 20% (e.g. through energy-efficient refurbishments) or substitute 20% of energy consumption with renewable energy systems.