Analysis of Shared and Sustainable Value Creation of Companies Providing Energy Solutions at the Base of the Pyramid (BoP)

• Published in: Business strategy and the environment 2016-07, Vol.25 (5), p.293-309
• Main Authors: Panapanaan, Virgilio, Bruce, Tytti, Virkki-Hatakka, Terhi, Linnanen, Lassi
• Format: Article
• Language: English
• Subjects: business at the base of the pyramid (BoP); Energy conservation; Energy industry; energy solutions at the BoP; Poverty; shared and sustainable value creation; Social sustainability; Sustainability; Sustainable development; sustainable energy solutions and enterprises; Value creation
• ISSN: 0964-4733; 1099-0836
• DOI: 10.1002/bse.1866

This study was conducted to analyze the shared and sustainable value creation (SSVC) of 33 energy companies selling energy solutions at the base of the pyramid (BoP) markets. SSVC by selling energy technology solutions directed to address the cooking and lighting needs of BoP consumers were the main focus of analysis. Result showed that achieving profitability and affordability is affected by the kind of energy solution that is offered as well as the investment and level of commitment required. However, companies that fulfilled the profitable and affordable solutions were also able to deliver social and environmental sustainability benefits. Social sustainability benefits point to the ability of alleviating poverty by improving productivity or offering cost‐savings. Environmental sustainability benefits point to the energy savings. The findings show that inclusive business strategy is not necessarily required to reach the poor people profitably but a suitable business strategy depends on the type of energy solution. Copyright © 2014 John Wiley & Sons, Ltd and ERP Environment