Impact Investing in the Education Sector
This profile covers investment in educational facilities offering full or part time instruction through:
Day care, primary and secondary school facilities in both rural and urban settings.
Tertiary education facilities or campuses including universities, technical colleges or business schools.
Preparation of learning materials for face-to-face or online delivery.
Business activities that fall within the scope of this sector profile include:
Provision of teaching and instruction in classrooms, playgrounds, sports fields or online.
Research activities.
General facilities management.
Catering services.
Boarding and dormitory services and facilities.
Management and upkeep of campus grounds.
Transport services for students.
KEY ENVIRONMENTAL AND SOCIAL ASPECTS
Management commitment, capacity and track record (CCTR)
Companies need management’s commitment and sufficient capacity to ensure that the necessary resources are available for sound E&S management. Refer to CDC Guidance: Assessing Companies’ Commitment, Capacity and Track Record.
Environmental and social management system (ESMS)
Companies should develop and implement an ESMS commensurate with the level of risks and impacts associated with its activities. For further advice refer to CDC’s E&S topic: Environmental and social management systems (company-level).
Labour and working conditions
Note – Occupational, health and safety is covered separately below.
Companies shall operate in accordance with applicable labour laws and regulations and ILO Fundamental Conventions. Please refer to E&S topic: Labour standards.
Occupational health and safety (OHS)
Risks for the business
Poor attention to Life and Fire Safety (LFS) can cause injury or loss of life and lead to reputational, legal and financial risks if incidents occur.
Reputational damage from poor occupational health safety and security (OHS) practices can reduce the student base and hurt profitability.
Low morale and erosion of trust can cause high staff turnover, lower productivity and lead to additional training and recruitment costs. It can also cause reputational damage.
Opportunities
Proactively involving teachers and contractors in key decisions can help to identify and maintain good OHS practices and improve their acceptance if new or significantly different to previous practices.
Productivity can be improved and compensation payments can be reduced.
Effective fire safety and emergency response standards to protect students and surrounding community will ensure stronger community and student support.
OHS is an important consideration for any business, regardless of sector, and all companies must have in place appropriate OHS and emergency preparedness and response management systems, commensurate with level of risks.
If contractors are involved in operation and maintenance activities, companies should implement measures to ensure contractors work in accordance with applicable regulations and Good International Industry Practice (GIIP). Such measures should be covered by companies’ OHS and emergency preparedness and response management systems.
The main sector-specific risks in education are those related to Life and Fire Safety (LFS) not only from an OHS perspective, but also for students’ safety. Where possible LFS risks should be addressed during the design and construction phase of an educational facility, as it can be both complex and costly to retrofit buildings to meet relevant LFS standards.
For further general guidance on GIIP relating to OHS, refer to E&S topic: Occupational health and safety, IFC Performance Standard 2: Labor and Working Conditions, World Bank Group General EHS Guidelines and CDC Good Practice: Preventing Fatalities and Serious Accidents.
Pollution prevention and resource efficiency
Risks for the business
Excessive expenditure on energy and water supply.
Excessive expenditure on management of solid waste and wastewater quality.
Potential fines and penalties for non-compliance with waste management or hygiene standards.
Opportunities for the business
Adopting energy and water efficiency measures can result in reduced operating costs and environmental footprint, and future proofing for a world of increased resource costs or resource shortages.
Energy efficiency: The education sector can be a large consumer of energy. Schools and universities often require a continuous supply of energy to light classrooms and power equipment. Therefore opportunities for improved energy efficiency or the use of renewable energy should be explored and where possible implemented.
This is often achieved during the design phase (see Project design and construction guide) when energy efficiency measures can most easily be incorporated into the operational practices of hospitality facilities (e.g. training of staff, encouraging student contribution to energy conservation, ensuring preventive maintenance and updating to more energy efficient products when replacing appliances.
Many energy efficiency technologies that may not have been feasible at design and construction are now economically attractive on a retrofit basis especially in areas where electricity prices have increased. Examples include LED lights, occupancy or motion sensors. The price of renewable power sources such as solar panels has also reduced significantly.
Air emissions: The education sector does not generate significant air emissions. The bulk of air pollution from education operations stems from on-site power generation (particulate matter and GHGs), and ozone depleting substances from large heating, ventilation and air conditioning (HVAC) systems. Particularly where older or poorly maintained equipment is used.
Water management: The education sector often requires a continuous and reliable supply of large quantities of good quality water for drinking, student ablutions, food preparation, cleaning, laundries, recreation, landscaping and design, fire protection and general premises upkeep. Consumption of water by guests, students and staff can exceed that of the local population and therefore there is potential for conflict with local communities regarding access to water – posing a significant business risk. High levels of water use also lead to large volumes of wastewater, which may be expensive to treat and may require special permits, particularly in remote or pristine areas. Special attention should be paid to on-site sewage treatment to prevent ground water contamination and the potential for grey water and post treatment water recycling should be investigated.
Waste management: The bulk of the waste generated by the education sector is non-hazardous waste (e.g. waste paper, packaging waste, organic solid waste from catering services) and can be considered domestic waste. Globally the introduction of waste segregation and recycling programmes at schools has proven successful, both as a way to reduce waste to landfill and to incorporate environmental awareness issues into the curriculum. This can lead to better waste management and environmental practices in the local community.
Where even relatively small volumes of hazardous wastes are generated (e.g. detergents and solvents from cleaning and laundry operations, or pesticides and herbicides from landscaping) the educational facility should ensure that these are stored, handled, transported and disposed of in accordance with GIIP. The facility should prevent environmental contamination or danger to handling workers and nearby communities.
For further general guidance on GIIP relating to resource efficiency and pollution prevention, refer to E&S topic: Resource Efficiency, E&S topic: Pollution Prevention, IFC Performance Standard 3: Resource Efficiency and Pollution Prevention, and World Bank Group General EHS Guidelines.
Community health, safety and security
Risks for the business
Companies’ licence to operate can be put at risk if appropriate LFS measures are not put in place. This could also lead to reputational damage, claims from students and legal and financial liabilities.
Poor attention to hygiene and food safety can have economic, legal and reputational impacts for the business.
Opportunities for the business
Building relationships with local communities can help to improve reputation and support for school initiatives.
Good community relations can help to widen the student base through improved dialogue and engagement with prospective students and parents.
Life and Fire Safety (LFS): This is vital to the education sector. All buildings used by staff and students should meet the highest standards for LFS. These standards should also be taken into account at the design and construction phase, as retrofitting can be costly, and monitoring and maintenance systems should be implemented during operations. Companies should design and implement emergency response measures and plans to protect the public (e.g. having clear signs for evacuation routes and the installation of smoke detectors and sprinklers).
Security: Some education providers employ security staff to protect staff and students, and the use of security personnel and security screening procedures is likely to increase in many emerging markets. When using security forces, education providers should be guided by the principles of proportionality, good international practice and applicable laws for hiring, rules of conduct, training, equipping and monitoring of security personnel – as set out in the general guidance below. Systems should be in place to ensure security forces do not commit abuses on local communities or students.
Hygiene/food safety: Facilities should be cleaned regularly to ensure a hygienic environment for students and teachers. Where the company provides catering services (either directly or via contractors), appropriate food safety standards in accordance with GIIP should be followed.
Child protection: The education sector has an additional set of concerns arising from the interaction between students and adults in a position of authority, i.e. teachers and other school employees such as cleaners and security staff. In particular, risks of child abuse or physical injury to students require careful attention. Schools should adequate background and security checks for employees and contractors. Such checks help assist employers in making safer recruitment decisions. However the check should only be viewed as one part of broader set of management measures that should ensure the children are afforded a safe, healthy and secure educational environment.
For further general guidance on GIIP relating to community health, safety and security, refer to E&S topic: Community health, safety and security, IFC Performance Standard 4: Community Health, Safety and Security, UN Code of Conduct for Law Enforcement Officials, UN Basic Principles on the Use of Force and Firearms by Law Enforcement Officials and Voluntary Principles on Security and Human Rights.