Waste management might not sound like the world’s most glamorous industry, but it’s certainly one of the most impactful, touching on all 17 of the United Nation’s Sustainable Development Goals (UN SDGs) – and every single one of our lives. Global waste generation grows by the day and is expected to increase to an annual 3.4 billion tonnes by 2050. The majority of collected waste isn’t currently disposed of responsibly, and only 13.5% is recycled. In sub-Saharan Africa, that number is even lower, with only 4% of waste being recycled.

A lack of waste management translates to increased environmental, climate, and health hazards, while squandering valuable materials. The problem, however, has grown so large it can’t be tackled by governments alone. Waste management concerns us all; Goodwell believes that the private sector must be a catalyst for meeting this vital societal need.

What role can impact investing play in waste management? 

Goodwell invests in basic goods and services that improve the lives – and livelihoods – of underserved people. We mainly focus on financial inclusion, agriculture and food, and mobility and logistics. But we’ve dedicated a quarter of our uMunthu II fund to investing in “other high-impact sectors” in Africa, including clean energy and education.   

Waste management is a clear fit for this mandate, directly impacting UN SDG 11 (sustainable cities and communities), SDG 12 (responsible production and consumption), SDG 13 (climate action), and SDG 14 (life below water). It also requires private investors to embrace and embody UN SDG 17, which stresses the importance of multi-stakeholder partnerships. Helping to drive improvements in this sector will reduce CO2 emissions, extract maximum value from existing waste, and promote circular principles by decreasing reliance on extractive virgin materials and increasing self-sufficiency

Waste management in Africa poses an interesting – and worthwhile – challenge. A rapidly growing population, urban expansion, increased production and consumption, and the global waste trade are all backing the continent’s waste management sector into a corner. The 81 million tonnes of waste currently generated in sub-Saharan Africa are expected to grow to 250 million tonnes by 2050. But 96% of that waste is currently unrecycled, signalling major investment and impact potential.

The business case for better waste management

Recycling, while certainly not a cure-all for global waste issues, has a huge role to play in moving Africa’s waste management systems in the right direction. It is an emerging income stream for many Africans, but often more motivated by poverty and unemployment than by design. In Nigeria, for example, over 100,000 people – known locally as “scavengers” – collect waste from (usually unregulated) landfills, risking exposure to toxic materials like lead, mercury, and cadmium. This waste is then sold to informal recyclers, who cause further environmental damage through unsafe burning and dumping processes. Doesn’t exactly sound like an industry of sustainability and prosperity, does it?  

But the current situation does present a clear space and need for private investment in waste management. Many waste streams have good commercial potential: e-waste recycling is gaining traction the world over, while plastic and glass recycling both have existing – and rapidly growing – market demand. In addition, bioconversion provides interesting opportunities for extracting value from food waste, turning it into a sustainable replacement for synthetic fertilizers. 

Goodwell is particularly interested in ways that waste management investments can further our vision of a more inclusive, circular economy. The sector is a wealth of innovation potential. We want to uplift formalised recycling, upcycling, repurposing, and closed-loop production in a financially sustainable way.

Clear social and environmental potential

Coupled with its commercial promise, investment in waste management also leads to significant social and environmental impact. We examine all our interests through a climate lens; promoting cleaner, greener, and more circular systems of waste management will directly reduce greenhouse gas emissions, decrease the need for destructive mining practices, and clean up communities’ water and soil, leading to improved health outcomes. The potential for job creation is also huge, as waste management is a labour-intensive sector, from sourcing and collecting to processing and valuation. The sector holds significant promise in terms of gender inclusion, with some waste management businesses already applying a gender lens throughout their value chain.

The benefits of waste management investment are clear. It makes sense: waste management is a world-wide need, and holds the promise of a cleaner, healthier, more inclusive economy. We’re looking forward to sharing some exciting updates about our involvement in the waste management sector in the coming months. If you’d like to learn more about Goodwell’s approach to investing and how we are working to increase climate resilience and build a greener, more inclusive future, please get in touch.