Danone’s Ecosystem Fund project is a modern and open illustration of the company’s dual social and economic value which has been part of its DNA since 1972, because, as F. Riboud said when the Fund was created, “It is in the interests of a company to take care of its economic and social environment, which we can call, by analogy, its ‘ecosystem’.
Created in 2009, the Danone Ecosystem Fund is an endowment fund of 100 million Euros aimed at co-creating inclusive business solutions with social and economic value for Danone and its Ecosystem partners, e.g. small producers and farmers (milk and fruits), small distributors and street vendors, waste pickers, caregivers (midwives, nutritionists etc.), micro-entrepreneurs.
Each “Ecosystem” project is the fruit of co-creation between several players:
• initiated by local subsidiaries of Danone;
• co-built with non-profit making organizations such as NGOs (Care, Askoka…) and small players of the local economy who are the ‘beneficiaries’;
• financed and assisted by the Danone Ecosystem Fund.
Today the Danone Ecosystem Fund works in partnership with more than 42 Non-profit Organisations on 54 projects, eight of which were new projects introduced in 2014. They are spread across 25 developed and developing countries.
The solutions delivered by the Fund are focused around five main themes related to Danone’s activity:
- sustainable production of milk and fruits,
- local distribution,
- protection of territories where Danone is present,
- personal services.
On December 31st, 2014, the total sum employed by the Fund for projects implemented by non-profit organizations and for activities of general interest led directly by the Fund, audits, impact studies, and monitored by coordination teams was 60 million Euros. Partners co-financed the projects in the sum of 40 million Euros.
The Fund has already delivered long-lasting economic and social solutions to more than 30,000 people.
The impact is materialized in the following areas:
- Socio-eco impacts: by generating jobs, long-lasting independent economic structures, income, developing competencies and capabilities, autonomy (with a particular focus on women)
- Societal impacts: on health (by improving the working conditions and consequently the quality of life), environment, sustainable action, inclusion, and women empowerment
- Business value creation: by ensuring secure sourcing and license to operate, topline growth, employees engagement, company reputation, brand equity, and socially responsible investment.
Thanks to the Fund, Danone transforms its practices and has developed an immediate competitive advantage which will be maintained in the long term through the creation of sustainable solutions, rooted in the territory and the social dimension.
This competitive advantage is based on:
• a ‘license to operate’, i.e. the economic and social legitimacy of Danone to operate in the territories where it is established;
• a positive differentiation between Danone and its competitors.
This is how the Danone Ecosystem Fund participates in the development of an inclusive economy, which reconciles the long-term development of an international company such as Danone with that of small players in the local economy who make up the ‘reinforced ecosystem’.
Conceived as a laboratory of experiences and mindful of measuring the social and economic impact of projects that it has co-created, the Fund has put in place, with the help of experts (researchers, academics, sociologists, economists, etc.), the assessment tools necessary to help lessons to be learned from its successes. In this way, new, viable and ongoing models of socioeconomic businesses will be built, projects will be audited, and their impact will be studied (William Davidson Institute, ESSEC, etc.) and monitored by a coordination team.