CEMEX – Supporting vulnerable communities

Hello Martha, could you briefly introduce CEMEX, especially its inclusive business model?

CEMEX is a global building materials company that provides high-quality products and reliable service to customers and communities around the globe. We have about 40,000 employees and are headquartered in Mexico. We have been doing inclusive business in Latin America for 25 years, since the creation of Patrimonio Hoy. Growing is the umbrella and global strategy of CEMEX’ inclusive and social business initiatives, combining three flagship business models: Patrimonio Hoy, Construyo Contigo, and Clean Cookstoves.

Patriomonio Hoy combines the global presence of CEMEX distribution with the power of microcredit. The programme offers integral solutions to low-income families by providing them with financial and technical assistance in the construction of their homes. With more than 100 offices in Latin America, Patrimonio Hoy enables families to build or improve their homes quicker, more efficiently and with more durable and insulating materials than would otherwise be possible.

Construyo Contigo is designed to not only improve housing for low-income families but also support them develop capabilities to actually overcome poverty – by offering the training, funding and technical assistance they require to construct their own homes. Its business model is based on a public-private partnership involving local governments, non-profit organisations and universities. More than 5,500 families in Mexico and Colombia have benefited from this business model since 2010. Find more details here (Spanish).

Joining forces with social entrepreneurs, CEMEX creates affordable community solutions that provide access to basic services like clean water, energy, and waste management. In 2014, as a clear example of this commitment, we introduced our hybrid-value-chain model and our own efficient cookstove model, the CEMEX eko-stove. Our first two projects take place in Mexico and Guatemala, where we partner with local social entrepreneurs to produce stoves, raise awareness and promote adoption. The clean cookstove provides a safe alternative to traditional cooking methods and has numerous social, environmental and economic benefits.

Thank you. Covid-19 has been ongoing for about six months. How did you experience these from a business perspective?

The construction industry has been recognised for many years for prioritising safety and support behaviours that protect people’s wellbeing. It is evident that our operations, including inclusive business activities, were disrupted due to the social distancing in some cities. We have been able to continue operating some of our projects with stronger safety measures.

As part of our response to this crisis, we launched a comprehensive response strategy of three components: protect our employees and families, support our communities, and build back better. In the build back better component, we are reconfiguring our social impact investment, including inclusive business, to find ways to support the economic recovery rapidly in partnership with local organisations and with focus on education, employment, and entrepreneurship.

How did Covid-19 affect the families you are working with?

The Covid crisis has exacerbated poverty conditions. The families we work with were in a vulnerable situation even before the pandemic. Many people may lose their jobs; children may be unable to catch up with school. We do not yet know how large the impact on our community partners and customers will be. We know, however, that these families are creative and resilient. They have shown strength and willingness to move forward and we will continue our inclusive business activities to support them.

In Mexico, for instance, we have partnered with many construction industry stakeholders to create business opportunities for many of our communities, in which groups of people are manufacturing face masks. Under the umbrella of “Behaviours that save lives”, we created a communication campaign to reinforce safety behaviours and maintain our industry essential.

What were the most important lessons learned for CEMEX during the last six months?

To always focus on the safety and wellbeing of people, and to innovate with a human centric approach. We leveraged our business expertise and developed hospital modules that can be built in 15 days and cost 70 percent less than traditional construction systems. We have also developed and published more than 50 safety protocols. Everyone, including other industry stakeholders and competitors, can access them. I think these two actions are consistent with our purpose of building a better future and creating a positive impact in the first weeks of the pandemic.

Were there any resources you found useful during the pandemic?

Yes, I would say intangible resources. The first one is a capacity in our company to build trust with different stakeholders, including local government authorities. This capacity helped us to keep operations running. Another intangible source of value was innovation: People came up very quickly with the hospital module, as I mentioned. And a third one is collaboration. We have been working with multiple stakeholders like NGOs, social entrepreneurs and academia for years. When the pandemic hit, our communication channels were already established and that helped us to enable support very quickly.

Financial resources were also in place. Our top management approved different ways of collaboration to provide humanitarian aid, protective personal equipment, and donations for infrastructure in the early phase of the pandemic.

Do you expect Covid-19 to have a lasting impact on CEMEX, especially its inclusive business model?

It is going to give us the opportunity to build new solutions. We will continue to innovate and develop inclusive business models around technology and to use it to support our current lines of business. We have already made progress. For instance, we have developed CEMEX Go, an app that is working very well as an interface between CEMEX and our customers, and we have leveraged our technology to be near our offline workers.

If you think about other inclusive business companies, is there anything you can recommend to them?

There are five P's in developing inclusive business ideas. The first P is "purpose": Companies should be consistent about whether they really want to help people overcome poverty or just enter new markets. The second one is "people" – companies need a team with people with the right skills and mindset to pursue one of these two purposes. The third P is "policy": There must be a policy and statement of commitment from the top management that unlock resources and cross-functional collaboration. The fourth one is for "process": how to incubate an idea, piloting it and scaling the model. The final one is for “profit”, which requires clear financial KPIs for incubation and scale up.