Despite bold ESG pledges from global giants like Unilever, IKEA, and Patagonia, Africa’s communities, workers, and entrepreneurs are still waiting for justice, transparency, and truly inclusive development.
Beneath glossy sustainability reports promising empowered communities and regenerated ecosystems, a stark question echoes across African markets: Can multinational corporations (MNCs) genuinely align global profit motives with meaningful purpose on the continent? While giants like Unilever, IKEA, and Patagonia champion Environmental, Social, and Governance (ESG) principles, the reality in African capitals reveals a profound disconnect. Local voices and persistent contradictions challenge the very foundation of ethical business in Africa, exposing a widening chasm between global pledges and urgent local imperatives.
The imported suit: Global frameworks meet African realities
Corporate mandates crafted in London, Stockholm, or California pledge climate neutrality and inclusive growth. Yet, implementing these in Africa, defined by fragmented regulations, infrastructure gaps, and acute socio-economic needs, often leads to costly inefficiencies and misalignment.
“The frameworks feel like a suit tailored for someone else, forced onto us,” asserts Monica Gichuhi, Minerals Governance Consultant at Quadz Consulting, Nairobi.
“Standards conceived in the global north land here with metrics utterly disconnected from our realities – like demanding complex water conservation audits when communities lack basic access.”
This bureaucratic maze stifles local businesses.
Jennifer Hinton, Group ESG Manager at Jervois, observes:
“We see SMEs drowning in ESG reporting demands designed for London-listed giants. They spend more time documenting compliance than actually delivering impact relevant to their community. It’s a costly distraction from building resilient local businesses.”
This focus on external validation risks greenwashing, where minor environmental gains overshadow critical social needs like poverty reduction and job creation.
Global frameworks also frequently miss crucial local contexts:
- Artisanal mining, employing 14 million Africans, is often excluded.
- Issues like gender-based violence and land insecurity are hard to quantify and thus ignored.
- EU frameworks like the Taxonomy excluding natural gas clash with African energy realities where gas can be vital for local development, notes Ezekiel Opoku of Wiseoak Limited, Ghana.
Unilever Kenya: Shiny initiatives, unhealed wounds
Unilever exemplifies the ESG tightrope. Its “Growth Action Plan 2030” boasts ambitious goals:
- Supporting 250,000 smallholder farmers by 2026
- Ensuring a living wage for suppliers
- Training 5,000 Kenyan women entrepreneurs
Locally, its “U-Turn” plastic recycling programme engages schools.
“Children are powerful change agents,” affirms Draganah Omwange, U-Turn Project Leader, Nairobi.
“Teaching them plastic equals value shifts mindsets early.”
Yet, structural inequities persist.
Oxfam’s 2023 report highlighted a glaring imbalance: €25.8 billion returned to shareholders globally over three years, versus a mere 0.6% of turnover reaching smallholder farmers.
“The talk is big on supplier diversity,” shares Grace Wanjiru, Owner, Ujuzi Agri-Processors, Nairobi,
“but the hurdles – complex quality specs, slow payments, huge volume demands – crush small players.”
Kericho: The unresolved legacy
Unilever’s ESG narrative is haunted by Kericho.
A 2020 UN complaint alleges the company failed to protect workers during 2007 post-election violence at its tea plantation.
Hellen Nyaboke, a survivor, states plainly: “We lost homes, loved ones, everything. The company’s response? Minimal help… Years later, promises of remedy remain empty words. How can they speak of ‘purpose’ while ignoring our pain?”
True alignment demands confronting past harms; neglecting this erodes all credibility.
IKEA: Philanthropy’s glow, sourcing’s shadows
IKEA illustrates the peril of separating “purpose” from core operations. While the IKEA Foundation demonstrates commendable commitment:
- A $1 million grant to RMI for rural renewable energy in Ethiopia
- €3.3 million supporting social entrepreneurs
…the core business model tells a different story globally and locally.
- Investigations reveal issues like age discrimination, union busting, and exploiting truck drivers in Europe.
- Global wood sourcing has been linked to illegal logging.
- In Ethiopia, sourcing oversight appears superficial.
Bekele Teshome, Leader, Oromia Cotton Growers Cooperative, voices frustration:
“IKEA auditors arrive yearly, check boxes, then vanish. No dialogue. No investment to help us meet standards. It feels like a performance.”
Selamawit Gebre, Director, Ethiopian Centre for Supply Chain Transparency, Addis Ababa, adds:
“Purchasing remains fixated on low cost and high volume. Where is the evidence of living wage premiums? The Foundation’s good work cannot mask the core business’s opacity.”
True purpose is not outsourced to philanthropy.
Patagonia: Global ethics, limited local footprint
US apparel giant, Patagonia, the global ethical benchmark, faces its own complexities in Africa.
While its supply chain ethics (organic cotton, Fair Trade) and activism are lauded, audits in shared Asian factories revealed:
- Underpaid overtime
- Excessive hours
In Africa:
- Its direct presence is primarily retail in South Africa via a local partner, Grant Cleghorn, who embraces the “Patagonia Way.”
Keneilwe Seleka, Sustainability Analyst, Cape Town, observes:
“Patagonia sets a phenomenal bar, but its premium model and limited on-ground production mean its direct impact on African job creation is less visible than its global leadership. Its influence here is more aspirational standard than transformative economic force.”
The accountability vacuum & investor hypocrisy
A critical enabler of the purpose-profit gap is Africa’s lack of enforceable ESG infrastructure.
“We operate where reporting is voluntary and verification weak,” states Dr. Amina Suleiman, Director, Nairobi ESG Research Institute.
“Without mandatory frameworks and audits with teeth, companies can selectively report successes. It becomes sophisticated reputation management.”
This is compounded by a severe data deficit.
Akosua Mensah, Financial Journalist, Accra, adds:
“The lack of locally relevant, audited data means African realities rarely sway global scores. It perpetuates a cycle where what matters here doesn’t count there.”
Anushka Bhagdanov, CEO of Risk Insights (South Africa), warns:
“Greenwashing is not harmless… ESG must return to being a tool for long-term sustainability and shared prosperity.”
The financial core tension
Ultimately, the core tension is financial:
- ESG requires patient capital
- Shareholders demand quarterly returns
Data reveals the stark reality:
- 49% of investors threaten divestment over poor ESG
- But 81% refuse to accept more than a 1% reduction in returns
When profits tighten, African ESG budgets are often first cut.
The fundamental extractive model, sourcing low, selling high, repatriating profits, remains largely unaddressed.
Africa’s crossroads: Beyond tokenism to rooted transformation
Africa stands at a pivotal juncture.
MNC ESG commitments can either catalyse embedded sustainable development or remain elaborate reputation laundering.
The stakes, environmental damage, entrenched inequality, eroded trust, are monumental.
- If Unilever champions women’s empowerment while evading Kericho accountability, ESG becomes greenwashing.
- If IKEA’s philanthropy shines while core sourcing lacks fairness, ethical capitalism rings hollow.
- If Patagonia’s ethics don’t translate into tangible local value creation, its purpose remains aspirational.
For Africa’s youth, the future workforce and market, genuine ESG integration is fundamental.
The continent possesses growing leverage to demand reciprocity.
Hellen Nyaboke’s demand resonates:
“Empty promises insult our dignity. We need action that matches the talk.”
From hollow promises to shared prosperity
The era of hollow “doing good” must end.
Africa needs authentic partnerships where:
- Profit demonstrably serves purpose
- Global capital invests in local capacity
- Accountability means tangible justice
As Michael Jordaan, South African entrepreneur, notes:
“Constraints allow you to be innovative.”
African innovators like Simbarashe Mhuriro of Oursun Energy (Zimbabwe) measure success by:
“Creating jobs… creating wealth… and being environmentally-conscious.”
This is the essence of impact-driven entrepreneurship Africa demands.
The verdict on corporate purpose unfolds not in distant boardrooms, but in the lived experiences of workers, farmers, and entrepreneurs across the continent.
Their reality is the ultimate ESG scorecard.
Written by Edward Githae
