In San Jose de Maipo, Carlos Gomez's family has been making honey for three generations, but sales of their Miel de Montana have never really stretched beyond their home in El Volcan, a village in a mountainous region of central Chile.
That was until 2016, when Gomez won a grant from AES Gener, a Santiago-based company that was building two hydropower plants near his village. With those funds, he bought an extractor to increase output from his 50 or so beehives, helping to widen sales in Chile.
Miel de Montana is one of a few hundred projects that have secured grants since 2012 from AES Gener, a venture backed by U.S.-based AES Corporation, one of the world's biggest electricity companies. The funds have gone to building water treatment plants, creating a kayaking tourism venture and starting up an empanada business. Maritza Chacon used one of those grants to launch Adiccion del Maipo, a family chocolate business.
Scarlett Alvarez, AES Corp' vice president and chief stakeholder and sustainability officer, said helping startups has done more for the villages than building community centers or providing scholarships. "Instead of giving people fish to eat, we prefer that they learn how to fish," she said. With their own businesses, communities in the areas around the hydropower projects can profit from the influx of construction and power plant workers as it puts a strain on supplies and services--and increases demand. At the same time, AES Gener can integrate itself within the community, creating rapport as an outsider.
"It's win-win," said Alvarez.
To decide which projects to finance, AES found as a new arrival that a good strategy is to involve the local communities and governments to understand what is needed, and not just replicate what may have worked elsewhere. AES can then help shape the projects into viable plans that provide an economic and social benefit.
The company has provided grants for 362 projects in Chile and another 20 in Panama, and it is expanding the model to other markets.
The grants are part of a trend in corporate responsibility and sustainability as companies seek to put profits to good use in society in Latin America, and it is not going unnoticed. AES and four others won the Latin Trade IndexAmericas Sustainability Award for the most sustainable of 6,000 companies analyzed by the Inter-American Development Bank (IDB) in Latin America for their performance in practices favorable to the environment, society...