Question: With the aid of examples, discuss some of the social and economic

responsibilities of ethanol producing companies.

Although Ethanol production is generally viewed as a threat to the social and economic well-
being of the surrounding communities, however with the proper responsibility by ethanol
producing companies it can lead to the opposite, and this is known as corporate social
responsibility. Corporate social responsibility (CSR) is a business approach that contributes to
sustainable development by delivering economic, social and environmental benefits for all
stakeholders (Carroll and Buchholtz 2003, p. 36).Zimbabwe’s largest ethanol producing
company is the Green Fuel ethanol company in Chisumbanje, Chipinge district. Examples of the
economic responsibility of ethanol producing companies are creation of employment,
development of infrastructure and social responsibility include health, education provision and
philanthropy. Under the right conditions, for example, ethanol production can yield positive
socioeconomic benefits to rural communities through employment, infrastructure improvements,
provision of electricity, increases in land value, and income from smallholder cultivation (World
Bank 2010)

Ethanol producing companies have the economic responsibility of creating employment to the
local population. One of the primary benefits purported to come with large-scale plantations is
formal employment (Peters and Thielmann, 2008).Ethanol companies employs a wide range of
workers in a variety of occupations. Scientists and engineers conduct research and development;
construction workers build plants and update infrastructure, agricultural workers grow and
harvest feed stocks, plant workers process feed stocks into fuel; and sales workers sell the
biofuels. Both skilled and unskilled labor can pursue careers at the company. An article in the
Patriot by Patience Rusere (2016) states that in the first phase of the project, Green Fuel
Company employed about 5 500 people. The local communities that are providing labor are
villagers from Chiredzi, Chipinge and Chimanimani. The creation of employment leads to
reduced unemployment levels in the community hence there is improvement in the
economic welfare of the community thus improved standards of living through salaries.
Ethanol production companies also have an economic responsibility of conservation of the
local resources through recycling. Study of the amount of fresh water used and the amount of
waste water in the production of fuel ethanol from softwood shows that can be reduced to a large
extent by recycling of either the stillage stream or part of the liquid stream from the fermenter.
According to Holly Jessen of the Ethanol producer magazine (2012) Absolute Energy Company
in Italy has taken steps to reduce the amount of water used in its ethanol production process. The
recycling of water in the production of ethanol ensures that resources are conserved and used in
other economic sectors for example irrigation. This tends to boost the economy.

Ethanol producing companies such as the Green Fuel in Chisumbanje, Zimbabwe have to
be economically responsible for the infrastructural development in the local areas in which
they are located such as building of roads, banks and clinics. An article in The Patriot by
Patience Rusere (2016) states that the Chisumbanje Ethanol plant project has brought hope to the
arid south eastern Lowveld region. This can largely be supported as Checheche growth point has
developed with residential housing and service industries construction. An article in The Patriot
by Patience Rusere (2016) states that National Foods has opened a depot as have Fawcett
Security and Moonlight Funeral Services, tapping into the reported US$2 million which flows
into the local economy directly and indirectly as a result of the ethanol project. As a result of the
GreenFuel ethanol company roads are being maintained, bridges being repaired, boreholes are
being sunk, schools and hospitals getting different forms of assistance, business is on a steady
rise, while the demand for residential space is increasing by the day. Financial institutions like
ZB Bank, CBZ Bank, Agribank and BancABC have all opened branches.

The irrigation schemes are the hallmark of Green Fuel Company’s social responsibility program
and, in light of the erratic and inadequate rainfall in the area, the company is focused on
providing small-scale farmers access to irrigation farming.  In this regard, the Company has
undertaken to develop 10% of all land under sugarcane for the community in the form of
irrigated plots. The installation of irrigation tends to benefit the Checeheche community through
provision of fresh water not only for the sole process of irrigation but rather for other domestic
uses such as cooking. The company provides these farmers with consistent support and
assistance. The water is pumped throughout the year at the cost of the company thus ensuring
reliable availability of water in an area that receives very little rainfall and, as a result, each
farmer can produce up to three cash crops per year. According to information on the green fuel
website (2020) the company is currently in the process of developing a further 380ha of
irrigation schemes for the Chisumbanje community which will benefit a further 760 farmers .

Ethanol as a fuel is in high demand hence Ethanol producing companies have an economic
responsibility of making sure the gem is affordable to the general population at cheap
affordable prices. Ethanol is used to make blended petrol which is then used to fuel up
motor vehicles. The main benefit of fuel blending is that it reduces dependence on foreign oil
and increases the nation’s energy independence. High dependence on foreign petroleum supplies
puts the country at risks of trade deficits, supply disruptions and unstable and unfair price
changes. Thus it is the economic responsibility of the local ethanol producing companies to
provide cheap and affordable fuel to the general population. In an article in The Herald by
Takunda Maodza Manicaland Bureau Chief (2019) quotes Green Fuel public relations
manager Ms. Merit Rumema “Blending unleaded petrol with ethanol has the direct effect
of reducing petrol prices at the pump and as Zimbabwe’s ethanol is locally produced,
blending it with imported fuel provides direct import substitution and significant foreign
currency savings,”. In Zimbabwe, a 10% blend of ethanol reduces fuel prices by approximately
US4-5 US cents per litre (Pindiriri, 2016).

Social responsibilities of ethanol producing companies such as the Green Fuel in

Zimbabwe include health, education and philanthropy investments. Social responsibility is the
idea that businesses should balance profit-making activities with activities that benefit society; it
involves developing businesses with a positive relationship with the society in which they
operate. Ethanol producing companies take up large pieces of land that my result in migration of
the local communities to other areas. Indigenous people with traditional claims to land are
particularly disadvantaged by oil palm expansion, as formal recognition of their claims is limited
(World Bank 2010). It is the responsibility of the company to avoid the displacements of the
locals. An article in the Herald by Freeman Kazembe (2018) Green Fuel Company handed
over the 20 hectares of irrigated plots to the community and this comes after the company
made a commitment to develop 10 percent of all land under sugarcane for the community.
Since ethanol producing companies take up large pieces of land through sugar plantation it
is their social responsibility to make sure the heritage of the local communities is
conserved and not destroyed through relocation and migration.

In an interview with the Herald, Green Fuel communications and relations manager Ms Merit
Rumema said the company had an impressive portfolio of community projects, which included
entrepreneurial projects, education and social service infrastructure rehabilitation and support of
the girl child. Green company’s current major projects include a sewing workshop for producing
work suits and uniforms, library and a technology center for local students, three community-run
kitchens, broiler projects and fencing projects, a project for producing reusable sanitary pads for
girls in the local schools, rehabilitation of roads, drilling boreholes, reforestation of the area and
continuous support of the local schools, clinics and hospitals. Green Fuel Company has a robust
corporate social responsibility program that is immensely benefiting the local community called
“Vimbo–Hope for a better future”.

Through Vimbo, Green Fuel Company have introduced a portfolio of community projects, all of
which have been constructed around the principle of sustainable development through irrigation
farming, entrepreneurial projects, education and social service infrastructure rehabilitation. The
current major projects include a sewing workshop which is run by a group from the local
community; a library and technology center opened in partnership with Old Mutual to provide
the local students and community members with computer lessons and access to books; a
community kitchen which is run by a group of local ladies to feed our factory staff; broiler
projects; fencing projects; donation of reusable sanitary pads; rehabilitation of local roads,
drilling of boreholes and reforestation of the area.
Ethanol producing companies also have a social responsibility of Philanthropy. Philanthropy is
the desire to promote the welfare of others, expressed especially by the generous donation of
money to good causes. For example the Green Fuel is dedicated to supporting education in the
community and have therefore made a commitment to assist the schools under Chief Garawa as a
starting point. Green Fuel latest project is building bunk beds for Katanga High School.  The
school managed to obtain funding from an NGO to build two dormitories for their female
students to stay in.  This was done as many of the girls had to walk long distances to school
every day and so were staying in the nearby community to avoid this, resulting in many cases of
abuse. The school has built dormitories but didn’t have the funding to furnish them, meaning that
the 60 girls are currently sleeping on the floor.  Green Fuel is in the process of building bunk bed
frames and sourcing funding for mattresses for the girls to sleep on.

However in light of the social and economic responsibility of the ethanol producing companies
such as Green Fuel in Chisumbanje the production of ethanol there are also costs to the
community. Results from a survey in the rural Checheche community, a community in which the
plant is located, indicate that even some of the community members not directly involved in
Green Fuel Zimbabwe activities due to lack of education qualifications. The main feedstock of
ethanol production at the Chisumbanje ethanol plant is sugar cane. So the expansion of ethanol
production requires taking land from other crops and allocating it for sugar cane production.
Growing sugar cane has some opportunity costs in terms of the other forgone crops such as
cereals. The main crop grown in the area besides sugar cane is maize; hence maize is the next
best alternative crop. (Pindiriri, 2016)

In Conclusion, the Chisumbanje community benefits from the ethanol plant through employment
creation, electricity generation, income from share cropping, banking services provided, and
fertilizer which comes as a by-product from the ethanol plant. About 4,500 people are employed
by Green Fuel Zimbabwe, of which 75% are from the local communities. The factory employs
240 workers and the rest of the workers are employed as farm workers. The plant also has a
capacity to generate about 18MW of electricity, enough to power all the communities in the
Chisumbanje area. The community had no electricity before the project, a problem resolved by
the project. Communal farmers are given half hectares of irrigated land and fertilizer (a by-
product from the plant) which enable them to produce enough food for their families. They can
produce an average of six tons of maize per year, much larger than the less than a ton produced
before the project. In addition, communal farmers generate an average of about U$1,300 per year
from share cropping with Green Fuel Zimbabwe.
REFERENCES

Patience, Rusare. (2014) ‘Chisumbanje Ethanol Plant: Hope for the future’, The Patriot [online],
16 January.Available from https://www.thepatriot.co.zw/old_posts/chisumbanje-ethanol-plant-
hope-for-the-future/

Takunda, Maodza.(2019) ‘GreenFuel doubles fuel production’,The Herald[online] 05

September.Available from https://www.herald.co.zw/greenfuel-doubles-ethanol-production/

Jeffrey Gogo. (2014)’Impact of biofuels need validation’,The Herald[online], 31

March.Available from https://www.herald.co.zw/impact-of-biofuels-needs-validation/

World Bank. 2010. Environmental, economic and social impacts of oil palm in Indonesia: a
synthesis of opportunities and challenges. World Bank, Washington, D.C., USA.
Shumba, E., P. Roberntz and M. Kuona. 2011. “Assessment of sugar cane out grower schemes
for biofuel production in Zambia and Zimbabwe”. WWF-World Wide Fund for Nature.Harare,
Zimbabwe.

Carren Pindiriri.2016 “The Economic and Environmental Costs/Benefits of Green Fuel: The
Case of the Chisumbanje Ethanol Plant”. African Economic Research Consortium, Nairobi
2. Explain the process of packaging in sugar manufacturing
Businesses are able to produce packaging materials from sugar cane. The main ingredient
used in the production of packaging products is actually not Sugar Cane but Bagasse.
Bagasse is the dry pulpy residue left after the juices and sugars are extracted from the Sugar
Cane plant and is commonly used for biofuel and is a basic ingredient used in producing
Sugar Cane Packaging. Bagasse can be made into tableware using either wet pulp or dry pulp
board. Once blended, the mixture is piped into a Preparation Tank and then the molding
machines. Bagasse is used to make a variety of food packaging items which include but is not
limited to takeaway containers, plates and bowls. Bagasse packaging items better for the
environment because they are biodegradable and compostable, they are aesthetically pleasing
too.

3. List any three leading markets for cane sugar.

1. Brazil
2. India
3. United States of America