Established in 1996, as a joint venture between Telenor Mobile Communications and Grameen Telecom Corporation, Grameenphone is today the largest mobile operator in Bangladesh. The company has 47.1 million customers and is the largest company in Bangladesh by market capitalisation. Grameenphone has a significant workforce, with over 4,900 direct, full-time employees and thousands more employed through its vendor and distribution networks. The company was listed on the Dhaka and Chittagong stock exchanges in 2009 and recently rolled out 3G services for mobile internet, which will increase the quality and speed of internet available through its network.

With a population of over 160 million, 31.5% of which live below the national poverty line, Bangladesh faces numerous economic and development challenges. However, the country has also experienced steady GDP growth of approximately 6% over the past several years, and a marked increase in life expectancy and literacy rates1. Like many parts of the developing world, this growth has increased demand for mobile phones, enabling Grameenphone to play an important role in Bangladesh’s economic development. Many Bangladeshis will access internet for the first time via mobile handsets, rather than on computers.

For Grameenphone, capitalising on this growing demand for mobile phone and internet does not mean doing business at any cost. Environmental and social (E&S) management is a core part of the company’s ethos and business strategy. The company has developed an exemplary environmental responsibility programme, as well as a robust system to minimise labour risks within its supply chain. It is also focused on improving access to cellular services in rural Bangladesh to give villagers the opportunity to generate income through self-employment.

Importantly, these initiatives are not only helping tackle environmental and social challenges in Bangladesh today; they are also creating value for Grameenphone and its stakeholders, and are a key part of the company’s competitive advantage.

E&S

GrameenphoneBuilding a Greener Network

- Reduced CO2 emissions through use of renewable energy, rainwater harvesting and alternative cooling systems, resulting in lower costs

- Increased employee engagement and retention through awareness and community programmes

- Increased brand awareness and differentiation through social development initiatives

E&S Positive Impact

CDC’s investment at a glance CDC, along with co-investors, provided financing to support the expansion and enhancement of Grameenphone’s network, technological advancement and energy efficiency initiatives

Investment: US$25 million

Date of commitment: 2013

Country: Bangladesh

Sector: Telecommunications

1 http://www.worldbank.org/en/country/bangladesh/overview

E&S E&SIntegration Transformation

In Bangladesh, insufficient power supply and outages remain a fact of life, and only 60% of the population has access to electricity. As the mobile operator in Bangladesh with the widest coverage, Grameenphone has to generate its own electricity when it builds mobile phone base stations in areas where commercial power is not available. Using generators that require oil and diesel has significant adverse environmental impacts, as well as exposing the company to unpredictable and potentially escalating operational costs.

A growing population and increased density in urban areas is also putting pressure on the country’s already limited waste management systems.

Notably, Bangladesh remains one of the most vulnerable countries in the world with regards to climate change and the associated extreme weather events, such as cyclones and flooding.

Within this context, Grameenphone believes it is the company’s duty to be a responsible corporate citizen, which led to the development of its environmental and climate change strategy in 2007. Given Grameenphone’s size and profile within Bangladesh, this initiative is now a key part of the company’s value proposition.

Grameenphone’s environmental strategy:

- Focused on five key areas: reducing carbon emissions, creating employee awareness, adopting green practices, creating green momentum in society and providing green services to its customers

- Target to reduce CO2 emissions by 40% between 2008 and 2015

- Instituted environmental management systems

- Reduced paper, electricity and water usage on its premises

Building a Greener CompanyAs part of Grameenphone’s environmental and climate change strategy, the “Building a Greener Network” programme is a roadmap that seeks to transform Grameenphone’s network and office building with environmentally friendly solutions and reduce carbon emissions by saving energy and fuel consumption. The company has set a target to reduce CO2 emissions by 40% by 2015, with 2008 as its baseline. The benefits of the programme to Grameenphone’s business are notable and extend beyond the positive impact on its reputation and ability to conduct business effectively. Some of the key achievements include:

• Installation of solar power tower sites: 500 solar hybrid power sites have been installed to date, replacing generator sites. Grameenphone estimates that it will reduce CO2 emissions by 5,400 tonnes per year and will save 2.04 million litres of fuel annually, lowering the company’s costs over the long term. As a result of the solar towers, the company increased its consumption of green energy by 138% from 2012 to 2013. In addition, by limiting its dependence on national electricity, the company is able to ensure uninterrupted services, which leads to increased customer satisfaction and retention positively impacting its revenues.

• Core site consolidation and optimisation: The company has reduced the number of core site locations from 22 to 14 and installed energy efficient equipment, which has saved approximately 400,000 litres of fuel and 11 GW-Hr electricity over the past few years. This amounts to approximately 7,000 tonnes of CO2 reduction per year.

• Installation of DC Ventilation Systems: Grameenphone has installed demand-controlled ventilation systems to replace the air conditioning systems at company headquarters, which has reduced its electricity costs. Additionally, the system saves 40-50% of energy onsite and reduces CO2 emissions.

• Rainwater harvesting: The company has developed a rainwater harvesting and treatment system at its offices, to reduce its consumption of ground water. This has saved an estimated 12 million litres of water per year.

• Recycling of electronic waste: Following the modernisation of its network, Grameenphone recycled more than 2,000 tonnes of electronic waste. The recycling was carried out in accordance with international standards, by licensed recycling companies and resulted in 98% of the e-waste being available for reuse.

Environmental Risks in Bangladesh

E&S: Grameenphone

E&S Responsibility

Bringing employees on board

Health and Safety at GrameenphoneThe safety risks for the telecommunications industry are high, as a result of tower installation and assaults related to attempts to steal fuel. Grameenphone has instituted a robust health and safety management system, and the installation of solar towers is also helping to minimise this risk, by reducing the company’s need for fuel.2

For environmental responsibility to be deeply embedded in Grameenphone’s strategy and culture, employees need to be just as engaged in the initiative as management. The company has launched several programmes designed to create awareness among employees and encourage them to become ambassadors for environmentally responsible business behaviour within the company and the broader community. These include celebrating Earth Hour and knowledge sharing at schools.

In addition to supporting Grameenphone’s strategy to be an environmentally responsible company, this approach to employee engagement demonstrates how implementing E&S management into business strategy helps to attract and retain talented employees.

E&S: Grameenphone

2 For detailed information and guidance for fund managers and investors on how to minimize the risk of fatal/serious accidents and how to help prevent future accidents, please refer to “CDC Good Practice: Preventing Fatalities and Serious Accidents,” which is available at www.cdcgroup.com.

Grameenphone’s commitment to environmentally responsible practices is not limited to its own operations. The company has launched a community power project, in partnership with the University of Oslo, to use renewable energy for rural development.

In Paharpur, a village in northeast Bangladesh that is one of many that is not connected to the national electricity grid, Grameenphone is using one of its solar power plants to power a mini-grid. This grid will provide power to more than 130 households from 5 pm to midnight daily, as well as providing internet services during the day in a community information centre.

The company also launched the Village Phone Program in partnership with Grameen Bank in 1997, to provide rural women with the opportunity to earn income. The Village Phone operators purchase a mobile phone, which they make available to the village for calls, enabling the operator to earn a profit.

Through these projects and programmes, Grameenphone is not only supporting socio-economic development in rural Bangladesh, but also creating revenue from increased use of its services and differentiating itself from its competitors by establishing itself as a leader in social development.

Grameenphone’s E&S initiatives have been recognised internationally:

mBillionth Award (Digital Empowerment Foundation):

For SMS-based solution for maintenance of tubewells to ensure safe drinking water in partnership with HYSAWA

Rain Water Harvesting Award (from Water Aid and Rain Forum):

For rain water harvesting at headquarters

Standard Chartered-Financial Express CSR Award:

For outstanding contribution to the betterment of the community and country’s development process

GrameenphoneBuilding a Greener NetworkE&S

Helping the community

CDC is the UK government-owned development finance institution that uses its own balance sheet to invest in the developing countries of Africa and South Asia. It has net assets of £2.9bn.

CDC’s mission is to support the building of businesses in Africa and South Asia, creating jobs and making a lasting difference to people’s lives in some of the world’s poorest places. Under its strategy, announced in September 2012, CDC provides debt and direct investment to businesses as well as acting as a fund-of-funds investor. CDC also now only makes new investment commitments in Africa and South Asia.

Find out more at www.cdcgroup.com

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