Biovale Biodiesel Business As An Agent Of Social Inclusion
A BIODIESEL BUSINESS
AS AN AGENT OF SOCIAL INCLUSION IN BRAZIL
To set up a pool of highly professional entities to
organize the bio-diesel production chain based on Jatropha
curcas feedstock, elaborating turn-key projects from soil to
promoting sustained development and poverty
alleviation, creating opportunities and a new model for
the intensive and extensive use of the energy biomass
potential of Brazil.
Main focus: most vulnerable region of Brazil: Semi-arid,
particularly, Jequitinhonha and Mucuri Valleys, in the Minas
Gerais, Bahia and Espírito Santo States (Meso Vale)
Final target: to consolidate a socially responsible and state-of-art
biodiesel holding industry in Brazil in partnership with BIOVALE
ENERGIA, a recently set up Brazilian corporation for this purpose.
“Take joint actions and improve efforts to work together at
all levels to improve access to reliable and affordable energy
services for sustainable development sufficient to facilitate
the achievement of the MDGs, including the Goal of halving
the proportion of people in poverty by 2015, and as a means
to generate other important services that mitigate poverty,
bearing in mind that
access to energy facilitates the eradication of poverty”
( Summit on Sustainable Development in the
Johannesburg Plan of Implementation )
“ We folks have to get out of the dry hinterland! But one only gets out
of the dry hinterland is taking it over from inside...” (Guimarães Rosa)
empowering the poor groups
If the conditions could be created for these small
producers to become more effective in production and
trade, poor groups could contribute significantly to
achieving a higher and more sustainable pace of
development, promoting not only economic growth but
But such conditions will not come about easily or quickly.
The legacy of history and the long marginalization of poor
groups in terms of the distribution of land and other
assets, in terms of institutions and of centuries of
inequity in access to education, nutrition and health,
create too great an obstacle.
These obstacles must be addressed and overcome if the
challenging targets on poverty reduction are to be
achieved. Acting directly on poverty means addressing
empowering the poor groups
Sustained growth can be achieved only by creating conditions in which
poor groups can increase their productivity and output.
Empowering these poor groups is not a diversion from promoting
growth. On the contrary, it is an effective, and perhaps the only, way
of achieving sustainable growth.
But empowerment will serve little purpose if the material means for
increasing production and incomes are not available to the poor.
Enhancing their skills and building the human capital of the poor will
have a major impact on both their economic productivity and their
By improving the productivity and sustainable management of land
and water, technological advances offer the potential to address many
of the obstacles that the lack of assets imposes on the poor.
Access to extension services, market and technology must be relevant
to the conditions of the poor and they must have access to it.
As a socially responsible corporation, we commit to the following :
1. We will incorporate ESG (Environment, social responsibility and Corporate
Governance) issues into general management, investment and decision-
2. We will be active managers and incorporate ESG issues into our management
and investment policies and practices.
3 We will seek appropriate disclosure on ESG issues in our management and in
the entities in which we invest and/or attract investment.
4. We will promote acceptance and implementation of the Principles within our
5. We will mobilize to enhance our effectiveness in implementing the Principles.
6. We will report on our activities and progress towards implementing the
In compliance with UN General Secretary initiative
UNEP – Finance Initiative – UN Global Compact
Corporate social responsibility
The Sell Side of important financial markets is recognizing the
materiality of corporate social responsibility.
Social and environmental issues can materially affect stock prices,
particularly over the long-term and sometimes even in the short-
“Business is part of society, not outside it. When we talk about
corporate social responsibility, we don’t see it as something
business does to society, but as something fundamental to
everything we do…not just philanthropy or community investment,
but the impact of our operations and products as well as the
interaction we have with the societies we serve. CSR is not a soft
issue or a nice to do activity on the fringe of business. It is central
to doing business. It is challenging to manage and it is a hard
edged business issue.” (expressed by the giant Unilever at the
London business School)
We encourage organizations and investors to scrutinize our
project/corporation as an attractive option to their socially
Brazil: the biomass source
Biofuels – the emerging solution for
“ Only in the Sun Country occurs the magnificent encounter
of the solar irradiation with the water, which generates a
stunning energetic profusion in its soil. This energy is a
heritage inherent to the Brazilian people and so it should be
exploited and used to promote its social and economic
development.” Artur Augusto Alves
The ability to grow energy crops in addition to food crops could
transform agriculture more profoundly than any development since
the green revolution - helping to achieve the United Nations’
Millennium Development Goals
In modern economies, large scale poverty imposes an enormous
economic loss, wasting the talents and energies of hundreds of
millions of people , diverted from socially productive activities that
could create wealth for society to the struggle for mere survival.
should be at the
global level, at the
country level with
the private sector
and civil-society But the fundamental partnership, and
institutions ultimately the only one that counts, is with the
poor themselves. They have the talents, the
skills and the knowledge of their own
poor groups. environment.
Biofuels: A New Future for Rural Communities
One of the main benefits of biofuels is their potential to increase
farm incomes and strengthen rural economies. The World Bank
reports that biofuel industries require about 100 times more workers
per unit of energy produced than the fossil fuel industry.
In 2004, the Brazilian sugarcane sector was responsible for 1 million
jobs (direct)/4 million (indirect) corresponding to the production of
350 million tonnes of cane (UNICA, 2003 and Goldemberg, 2003).
The dispersed nature of agriculture makes it unlikely that biofuel
production will become as centralized as the oil industry.
In the focused region of the project (Jequitinhonha & Mucuri Valleys)
the access to modern forms of energy is limited or absent. An
orchastrated pool of competences involved in the biodiesel
production chain can help provide income and clean, accessible
energy that is vital for rural development and poverty alleviation.
energy & prosperity
Most poor households in developing
countries lack access to modern
fuels. They instead rely on traditional
biomass fuels like crop
waste,dung, and wood to meet their
basic energy needs.
When used with inefficient devices these
low-quality fuels often result in harmful
health and environmental impacts.
The order of fuels on the energy ladder
corresponds to their efficiency and
‘cleanliness’ at end use.
Climbing the energy ladder towards more
modern fuels, therefore, is a challenge
Although modern fuels tend to be more
most poor people in developing countries
costly, they do provide people with far
must face in order to improve their
greater opportunities for income
overall standard of living.
Source: REN 21/2006
electricity x fuels
Electricity and fuels can produce different energy services.
Electricity is essential for modern communications, supporting modern
industry and the provision of public services.
Fuels, on the other hand, are essential for all households. Unless basic fuel
needs are met, electricity is a luxury item few can afford.
As such, the importance of electricity versus fuels varies based on the
different needs of the poor and the economic and social circumstances that
enable their use. Sensitivity to the differential impact that electricity can
have on the poor is crucial to planning and prioritizing energy-related
programs and projects.
Bio-oils and bio-diesel are supportive to the generation of cheaper
mechanical and electrical energy, besides powering water pumps for
irrigation and human consumption (enhancing potentially the
production of feed-stock seeds.
Source: REN 21/2006
energy link to overall human development
There is an empirical
basis to the relationship
between access to
modern energy and
Energy is strongly linked
to human development.
No country in modern
times has substantially
reduced poverty without
a massive increase in its
use of energy and/or a
shift to efficient energy
Source: REN 21/2006
Our local partners
The poor have to be recognized as individuals with rights and as potential
agents of change who can themselves play an increasing role.
In determining social and economic outcomes poor groups should not be
seen merely as a burden on society. Rather, the poor, especially women, are
hard working and often effective microentrepreneurs.
Our local partners
The development model is based on the working
relationship between the community benefiting
from the BIO-VALE project, a local technical NGO,
an enterprising development agency , a foreign
development agency, Government stakeholders
and a corporation.
Each entity has its respective and important roles
that complement, harmonize and support one
another leading to the ultimate success and
sustainability of the project.
“The private sector can play an important role
towards furthering development, for development
cannot occur without conditions that are amenable to
the conduct of business.” (United Nations)
General intervention strategies
Competitiveness and productivity:
MARKET SIGHT adoption of compatible mechanisms
Regional clusters formation
Attractiveness to private sector
BUSINESS SIGHT Favorable climate
Compatible working tools
Development model: local NGO
Local NGO´s will support following types of interventions:
establishing effective monitoring and evaluation systems, working
closely with cooperating institutions to improve impact assessment
and supervision, and strengthening partnerships with a range of
promoting a global policy environment that increases market access
for the rural poor.
directly responsibility to the community - directly involved in the
energy crop cultivation and oil extraction than the development
agency, assessing the communities’ organizational capacity and their
potential to complete and manage an energy project.
providing technical, organizational advice, support and training to
Development model: Foreign Development Agency
Direct main responsibilities of the development agency :
To provide seed money and matching grants that can initiate
and support the efforts of the NGO to raise the money needed
for a project and/or provide capacity grants which help to
build their organizational capacity.
To popularize the NGO achievements in developing sustainable
energy systems and related environmental protection plans
through the media, internet, and other written and visual
sources (SLUIJS & BODE, 2001).
To facilitate trainings for NGOs such as; community surveys of
power demand and potential usage, site selection, the budget
process, choice of appropriate technology, environmental
assessments, feasibility studies, civil design, operational &
fiscal management, micro-enterprise development, long term
planning, and grant writing (SLUIJS & BODE, 2001).
Development model: Investment agency
MINASINVEST, a not-for profit investment agency, will be primarily in
charge of the social-economic factors coordinating the efforts among
the various stakeholders, which includes:
Building market information systems.
Identifying and coordinating the best partners;
Developing policies and strategies to improve competitiveness;
Strengthening the producers´ negotiating position ;
Providing well-researched analyses;
Government and institutional relationships involved in the project.
Development model:The Community
The local community possesses direct responsibility towards the day-
today running of the biofuel project . Particular emphasis is given on
the socio-economic empowerment of women, thus women groups will
be specially utilized to manage the project.
The role of the community should therefore be:
● Provision of land for Jatropha plantation and site for the
establishment of the oil extraction unit.
● Responsibility for the day-to-day management of plantation,
including: cultivation and harvesting.
● Commitment of human resources for project development such as
unskilled labor (to handle farmlands), access to skilled labor.
In order to help the community in their quest towards sustainable
development, it is very important that they should be the main
recipient of all benefits accrued from the project.
End goal & management
The BIO-VALE project can bring about major economic
empowerment by providing income and employment
opportunities to both the rural communities and entreupreneus.
The project can be utilized to stimulate a circular system
combining ecologic, economic, and income-generating effects
(HEN. 1994), particularly to the drought prone rural
communities of the Brazilian semi-arid regions.
The project promotes the main aspects of development, which
combine to help achieve a sustainable way of life for village
farmers in terms of provision of renewable energy, erosion
control, economic empowerment through job creation and
poverty reduction and economic development.
The favorable context in Brazil, the onset of widespread
distribution, the differential tax regime recognizing the
importance of oilseed production by family agriculture units– and
the introduction of the “Social Fuel” label are regulatory
instruments designed to promote social inclusion throughout the
new fuel’s production and value chain.