Managing e-waste from off-grid solar systems in Kenya: Do investors have a role to play?

Overthepastdecade,themarketforoff-gridsolar(OGS)systemsprovidingaffordablesourcesofenergyhasseen a remarkable expansion in many developing countries where coverage by the electricity grid is limited. The ob-servedmarketgrowthhasbeenfuelledbytheprovisionof ﬁ nancebyavarietyofforeigninvestorstoprivatesup-pliers ofsuch systems.The development oftheOGS market playsanimportant partinmeeting thedevelopment imperativeofensuring access to sustainable andaffordablesourcesof energy for all.However, increasingaware-ness and criticism have emerged about the generation of electronic waste (e-waste) from solar products as an unintended negative side effect of their diffusion. In this paper, we explore whether and how investors of dominant OGS system providers in Kenya, a country that has experienced rapid growth in its OGS market, have reacted to concerns about solar e-waste by changing their funding modalities and practices. Our analysis is based on in-depth interviews carried out with a diverse sample of international investors and industry experts. We ﬁ nd that most investors have not incorporated requirements for managing e-waste beyond a mere box-ticking exercise in their due diligence and monitoring and compliance mechanisms. Hence, e-waste is currently not seen as a priority for investors, which raisesquestionsabout the overallenvironmental sustainability of such investments.Totheextentthat someinvestorshave devotedattention toimprovinge-wastemanagement, such effortsappeartohavebeenmotivatedbythepotentialriskstotheirreputations.Wealso ﬁ ndthattheGlobalOff-Grid Lighting Association – a global industry association for the off-grid solar sector – plays an important role in making investors aware of the link between their investments and the adverse environmental impacts of e-waste. Since most of the solar supplier ﬁ rms are start-ups that are concerned with developing viable businesses, we ﬁ ndthatinvestorsdo notwantto imposeanother costburdenonthembyrequiring theintroduction ofelab-orate e-wastemanagement aspart oftheirinvestmentcriteria. Furthermore, our interviews highlight thelackof adequate waste transport and recycling infrastructures and the lack of pressures from waste management regulation as key barriers to the management of e-waste. We discuss the relevance of these ﬁ ndings for strategies on how best to tackle the emerging problem of e-waste from OGS devices. © 2022 The Authors. Published by Elsevier Inc. on behalf of International Energy Initiative. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/).


Introduction
Off-grid solar (OGS) systems, such as solar chargers, lanterns and solar home systems, play an important role in meeting the development imperative of ensuring affordable and sustainable energy sources for all. 1 Across the developing world, markets for these systems are growing rapidly and significantly, with an estimated 180 million systems sold in the period from 2010 to 2019, and annual sales being projected to grow from 35 million in 2019 to 72 million by 2030 (Lighting Global, 2020).This development is being stimulated by extensive investments, totalling about US$ 1.5 billion in the period between 2012 and 2019 (ibid.).Much of this growth and investment has been concentrated in Africa, especially East Africa in countries like Kenya, where efforts to ensure affordable and sustainable energy for all are high on the political agenda.For example, cumulative investments in East Africa alone are estimated to have been US$ 851 million in the period from 2012 to 2019, making up nearly 57% of the global total (ibid.).
Due to the short lifetime of many OGS systems (GIZ, 2018), there are worries that this rapid market expansion will result in increasing amounts of electronic waste (e-waste).Magalini et al. (2016) estimated that the amount of e-waste generated from OGS systems sold in fourteen sub-Saharan countries would increase from 2200 t in 2016 to 12,000 t in 2020.In Kenya alone, around 700 t of solar e-waste were discarded in 2016, a figure that was expected to reach 3800 t in 2020.A recent study estimates that 26.2 million solar lights and solar home systems have already reached the ends of their lives in sub-Saharan Africa and South Asia (GOGLA, 2018, cited in: Global Leap Awards, 2019).While e-waste from OGS systems currently represents a small fraction of all e-waste, estimated at about 7% (CDC Investment Works, 2021), this share is likely to increase in the near future alongside the continued growth in OGS product sales.This raises concerns about the overall environmental sustainability of the industry, as OGS systems contain various hazardous and toxic materials, such as lead, cadmium, mercury and sulphuric acid, which can have serious adverse effects on human health and the environment (Bensch et al., 2017;GIZ, 2018).Such concerns have not only been raised by donors and solar industry associations, but also by national governments (Murray & Corbyn, 2018).
While there are a number of ongoing experiments and pilot projects that have started to address the issue of solar e-waste (Efficiency for Access, 2021; Lighting Global, 2020), these initiatives must be scaled up quickly and significantly in order to avoid social and environmental harm and negative impacts on the reputation of the OGS sector.This can take place through take-back and collection schemes offered by OGS system suppliers or through centralised collection systems implemented by national or sub-national agencies.Scholars and practitioners have identified a number of barriers to the implementation of improved solar e-waste management strategies.For example, the ways in which the quality and design of OGS devices affect the possibility for repair have been highlighted (Balls, 2020;Groenewoudt et al., 2020).Another key challenge is retrieving end-of-life products from consumers, for instance, due to a lack of consumer awareness or large distances between consumers and collection points (Efficiency for Access, 2021).There is also a need to establish adequate recycling infrastructures, which rely on the availability of funding, as well as on appropriate technological hardware and expertise (ibid.).Finally, there is a need to introduce policy and regulatory frameworks that are conducive to ramping up solar e-waste management, which is so far lacking in most countries (GOGLA, 2019;Hansen et al., 2021).
Previous research on the OGS market in Africa, and in developing countries more broadly, has tended to focus on the beneficial impacts, such as carbon emission reductions, livelihood improvements and job creation, and the barriers preventing further investment (see e.g.Bhattacharyya, 2013;Falchetta et al., 2021;Malhotra et al., 2017).Indeed, as argued by Cross and Neumark (2021), OGS is often portrayed as an inherently benevolent technology both socially and economically.However, an emerging literature has started to focus the attention on a range of undesired and negative implications, such as the unequal distribution of costs and benefits (Ambarsari et al., 2020;Boamah, 2020), the exclusion of local industrial actors (Lema et al., 2018) and -of particular importance for this paper -the generation of e-waste (Cross & Murray, 2018;Hansen et al., 2021;Kumar & Turner, 2020).This line of critical research is needed to provide a more balanced account of the various social and environmental implications of the diffusion of OGS systems in the Global South (Ockwell et al., 2018).
In this paper, we contribute to discussions on the issue of solar ewaste as an unintended, negative side-effect of investments in the OGS sector by focusing on the role that investors play in addressing and managing the increasing amount of e-waste from OGS systems.Investors, both public and private, play critical roles in the growth of the OGS market, as the financial resources they make available allow system-providing companies to emerge and grow.This includes development finance institutions, private investment funds, crowd-funding platforms, impact investors, family offices and foundations (ESMAP, 2021;Lighting Global, 2020).Through their due diligence and monitoring and control mechanisms, they can exert a substantial influence over their investees' efforts to address the potentially negative social and environmental impacts of their business practices (Eckert, 2017;Scandizzo, 2011).As such, we address the following research question: Whether and how do investors address the issue of e-waste in their investments in companies supplying OGS systems?To answer this, we focus on the Kenyan market for OGS devices.Specifically, we assess how the role of solar e-waste affects investors' decision-making processes by focusing on their due diligence and monitoring and control mechanisms.Furthermore, we identify the key drivers and barriers that investors face when considering solar e-waste in their investment decisions and modalities.The resulting insights are relevant for investors in the OGS market, who can use them to identify market trends and to inform their engagement with solar e-waste in the future.Our study also offers insights into OGS system suppliers regarding how the issue of solar ewaste may, now or in the future, impact on their access to finance.
The remainder of the paper is structured as follows.Analytical framework section introduces the framework we used to structure our analysis of investors in the OGS sector.Research methodology section presents the research methodology, describing our sample, data collection and analysis procedures.Empirical findings section presents the results.Discussion section elaborates on the insights they provide for discussions on how to address the problem of e-waste from OGS products.Conclusion section concludes the paper by summarising the key insights of our analysis.

Analytical framework
In this paper, we adopt a perspective focusing on the strategic considerations and practices of investors in the OGS sector.Investors increasingly integrate environmental, social, and governance (ESG) considerations into their investment analyses and decisions (e.g.RBC Global Asset Management, 2020;Van Duuren et al., 2016).This includes a wide variety of issues, such as environmental pollution, climate impacts, human rights, consumer protection, animal welfare, employee relations and executive compensation.In our paper, we study investors in the OGS market and focus on how they deal with the generation of solar e-waste from the rapidly growing OGS market as one specific kind of ESG impact.

Drivers and barriers for OGS investors
We are interested in the main drivers and barriers that investors in the OGS sector face when determining whether to prioritise the management of e-waste from solar systems in their decisions to invest in OGS companies.To this end, we draw eclectically on several strands of research.Firstly, based on literature on ESG-based financing (Scandizzo, 2011), we expect that investors regard being associated with increasing amounts of e-waste as an ESG-related risk that can negatively affect their reputation.Corporations derive their legitimacy to operate by meeting the institutional expectations of relevant stakeholders, which can include clients, consumers, policy-makers, taxpayers or business partners (Bansal & Clelland, 2004;Eckert, 2017).Failing to meet these expectations, for example, by causing social or environmental harm, erodes legitimacy and can become a source of risk requiring active management (Briand et al., 2011).Accordingly, the risk of suffering reputational damage can incentivise investors to devote attention to improving e-waste management.For investors, this risk involves a trade-off between being seen as promoters of environmental sustainability and being associated with environmentally damaging activities.
Another potential driving factor for investors involves pressures from external stakeholders, such as environmental NGOs, regulatory bodies or industry associations.There is a rich literature on the role of NGOs, social movements and civil-society organisations in pushing for environmental improvements in various industries, both globally and nationally (Esty & Ivanova, 2002).Industry associations may be a driving factor in certain sectors, for instance, by promoting sectorwide environmental standards.Examples include the sustainability labelling scheme in the palm-oil industry (Boons & Mendoza, 2010), environmental standards in the fresh vegetable sector (Dolan & Humphrey, 2004) and the sustainability initiative in the cement industry (Klee & Coles, 2004).In the case of the OGS industry, the Global Off-Grid Lighting Association (GOGLA) could potentially play a similar role by setting standards and by providing technical advice regarding ewaste management, both to its members and to investors aiming to address the issue (Hansen et al., 2021). 2 Finally, e-waste policies and regulations at the national or sub-national level could be among the most important factors incentivising investors to prioritise e-waste management (Sthiannopkao & Wong, 2013).Specifically, the recently approved e-waste management strategy in Kenya has adopted the 'polluter pays' principle through the so-called extended producer responsibility (Ministry of Environment and Forestry, 2019).Once implemented, the strategy will force investors to meet e-waste management standards under the threat of sanctions in case of non-compliance.
There are also certain factors that may prevent investors from considering e-waste management in their funding modalities.For example, this includes the specific strategies or mandates of different kinds of investors.While commercial investors, like venture capitalists or investment banks, are likely to emphasise the profitability of their investments, other investorssuch as development finance institutions or private impact investorsalso tend to consider relevant ESG outcomes.In the case of e-waste management, this might imply that commercially focused investors are less inclined to consider e-waste management due to the potentially negative effects on the returns on their investments.We expect that this is especially the case in contexts where investors do not view e-waste as a risk to their investments due to the lack of national regulations or social pressures.
Another potential barrier to the inclusion of e-waste management in investment decisions is the availability or otherwise lack of adequate waste transportation and recycling infrastructures.This type of infrastructure is lacking in many developing countries (Van Welie et al., 2018), especially in rural areas.Under such circumstances, investors who include strict e-waste requirements in their funding modalities effectively make it their investees' and their own responsibility to bear the cost of collecting and managing end-of-life products.However, this may be unrealistic, as the associated costs are usually very high.Furthermore, the problem might be exacerbated by the relative immaturity of the OGS market and the corresponding primary concern of many OGS companies with building and growing financially sustainable businesses.As result, investors, even those typically concerned with ESG impacts, are unlikely to require companies to take the lead in developing waste transport and recycling infrastructure.

Assessment and responses
Investors who choose to consider the issue of solar e-waste in their investment decisions require methods to assess the relevant risks and need to integrate these into their decision-making processes.Risk assessments are conducted at different stages in the investment cycle, including during the initial due diligence process and during periodic monitoring and control procedures throughout the duration of the investment project.Assessment methods vary by their degree of sophistication, ranging from no consideration at all to structured approaches based on comprehensive assessment frameworks and in-depth data analyses (Nielsen & Noergaard, 2011).Assessment methods can also be differentiated based on who conducts them.For example, while some assessments are self-reported, usually based on relatively passive box-ticking exercises, others involve detailed investigations based on interviews, site observations and structured analyses by specialised staff.Due to the resource-intensity of thorough ESG assessments and the lack of in-house expertise, some investors outsource this task to third-party service providers.Once e-waste-related risks are assessed, they need to be integrated with other investment criteria, including financial performance and other ESG factors.This largely depends on the availability of relevant data and ranges from implicit considerations not based on any data to the application of structured methods based on risk-weighted financial indicators or multi-criteria analyses.Finally, we consider the different ways in which investors adapt their investment portfolios in light of the potential risks from e-waste.For instance, investors may limit their 'investment universe' by screening out specific companies and market segments, they may focus on best-in-class companies, or they may promote better e-waste management by engaging directly with company boards and management teams (Eccles et al., 2017;Van Duuren et al., 2016).
Fig. 1 illustrates our analytical framework.In summary, we posit that there are a number of drivers and barriers that influence whether and how investors prioritise the management of e-waste from OGS devices in their decisions to invest in technology-supplying companies. 3In the remainder of this paper, we identify the most important drivers and barriers in the context of investors in the Kenyan OGS market.Furthermore, we investigate how investors react to these drivers and barriers, both in terms of the methods they use to assess the relevant risks and the ways in which they integrate e-waste management into their final investment decisions.

Data collection
As we currently only have a limited understanding of investors' considerations and responses regarding e-waste from OGS devices, we approach this issue using qualitative methods (Yin, 2009).Specifically, we conducted a multiple-case study of a range of investors that are directly involved with the largest suppliers of OGS systems in Kenya (and across East Africa) in terms of market shares.Our rationale for focusing on investors of established OGS supplier companies is that they are likely to have generated the highest volumes of solar e-waste so far due to their large size and long-term presence in the market.Furthermore, some of these OGS suppliers are already experimenting with e-waste management strategies (Lighting Global, 2020), which makes it interesting to identify what role their investors have played in these efforts.In contrast, younger and smaller OGS companies contribute relatively little to e-waste in terms of overall volumes, and they are likely to be focused on setting up a functional business as opposed to developing systems to manage future e-waste streams.
Thus, to develop our sample of investors, we first identified the largest OGS companies currently operating in Kenya and East Africa more generally.Based on a review of relevant industry reports (ESMAP, 2021;Lighting Global, 2020;Shell Foundation, 2017;USAID, 2019) and snowball sampling during interviews with investors and industry experts, we identified the following companies: Zola Electric, D.Light, M-Kopa, BBOXX, Mobisol, Greenlight Planet, Azuri Technologies, and Solar Now.Our focus on these OGS companies' means that we are concentrating on what are referred to as 'branded' products, that is, OGS products sold under quality certification schemes by brand-name companies often with product warrantees.Estimates suggest that the market share of these branded products in Kenya is around 35% while the remaining 65% involves a vast number of small, informal firms selling 'unbranded' solar products, which are often of lower quality and sold as copy products and counterfeits (Lighting Global, 2020).Our focus on OGS companies supplying branded products enables us to study the role of investors in relation to e-waste management given the pivotal role of external funding for suppliers of branded products.Firms selling unbranded solar products operate on a much lower scale compared to suppliers of branded products and are therefore not reliant on similar forms of external funding and related requirements.
We then reviewed these OGS companies' websites to identify all funding sources, which resulted in a list of 34 investors. 4We contacted representatives of all of these investors by e-mail or social media, and/or through personal contacts during the data collection process, and sent follow-up notifications when there was no response.Eventually, we were able to establish contact with a total of nine investors that agreed to participate in interviews.In what follows, these selected investors and the interviewees have all been anonymised due to the sensitive nature of the topic.
Table 1 shows our sample of investors included in the analysis.The sample is not representative of all of the 34 initially identified investors in a statistical sense.However, it does reflect the predominant role that government investors and DFIs currently play in the OGS market (Lighting Global, 2020).At the same time, the sample includes a variety of investor types, including government investors and DFIs, as well as impact investors, a crowd-funding platform and a strategic corporate.The shares of public investors (governmental investors including DFIs) and private/for-profit investors are roughly the same.The sample also covers different types of investments, including grant, debt and equity financing.Hence, it captures a variety of perspectives on investments and e-waste management that exist in Kenya and East Africa more generally.
In the period from April to September 2021, we conducted semistructured interviews with representatives of these investors via video calls, as they are based in different countries.The interviewees are employees with insights into the strategic priorities of the investors, as well as their ongoing operations and interactions with investees in the OGS sector.This includes managing directors, investment directors, advisors and operations managers.In some cases, several employees from the same investment organisation participated during interviews, which allowed us to obtain information across various management levels and functional divisions.As far as possible, we cross-checked key findings obtained about one investor in interviews with representatives of other investors.As a further attempt to ensure the reliability of the findings, we undertook three interviews with key industry informants in Kenya, including two OGS supplier companies operating in the country (for a full list of interviewees, see Appendix A).Finally, we closely reviewed the available information on investors' websites, in company brochures and other relevant industry reports to identify relevant information for our analysis.
We operationalised our analytical framework, introduced in Analytical framework section, by developing a detailed interview guide, which was used as a structuring device for discussions during the interviews (attached in Appendix B).After some questions on the background of the investors and the interviewees, the first section of the interview focused on questions about the specific measures that the investors have taken (if any) to address solar e-waste in their risk assessment and investment decision-making frameworks.This was followed up with a second section asking about the drivers and barriers that investors face with respect to considering solar e-waste management as an ESG criterion in their investments.To the extent possible, all interviews were recorded and transcribed to allow for detailed examination.Toward the final stage of the data collection process, additional interviews revealed only a little new information and mostly repeated the most salient points from previous interviews.At this point, we therefore decided that we had reached saturation point in our understanding and concluded the data collection process.

Data analysis
We followed a systematic approach to analysing the data obtained through the interviews.First, using the tabular approach suggested by Miles and Huberman (1994), we developed a comprehensive coding matrix based on our analytical framework presented in Analytical framework section.This was based on the two main elements of our analytical framework, including two sub-categories for each: (i) the extent to which and how investors integrate e-waste management in their investment decision-making processes (distinguishing between assessment methods and types of responses), and (ii) the motivations they face in doing so (distinguishing between drivers and barriers) (see Appendix C).For each investor, all relevant interview quotes pertaining to these four dimensions were categorised in our matrix, allowing for cross-comparison of the different perspectives.As we proceeded in the coding and interpretation process of the data, the main coding categories were maintained, but additional coding sub-categories emerged based on the empirical material.This coding matrix forms the basis for our results, which we summarise in the next section.

E-waste and investment decisions
In our interviews with investors and industry experts, we found virtually uniform acknowledgement that e-waste had become an increasingly important topic in the recent past and that its relevance will likely increase in the future.For many of the investors we spoke to, this issue is coming increasingly into focus, as some of the products of the companies they fund are now reaching the ends of their lives.This has led some

Drivers:
ReputaƟonal damage risk External pressure (NGOs, industry associaƟons, e-waste regulaƟon) Barriers: Focus on main intended impacts Economic costs of e-waste (due to lack of waste management infrastructure)

Assessment: SophisƟcaƟon of ESG assessments IntegraƟon into invesment decision making Response:
Requirements for OGS system suppliers (investees) Analytical framework to study investors' engagement with e-waste from OGS systems.Source: Authors own elaboration. 4All OGS companies we considered in this step of our sampling strategy provided publicly available information about their investors on their websites.In fact, some of these companies were very active in disseminating information about new deals they had struck with investors, which they presented as indicators of their market performance.
investors to assign e-waste medium to high priority in risk-rating procedures.For example, a representative of a large donor-funded programme explained the following when discussing the criteria that solar companies have to consider in making applications for grants: "[W]ith the small [OGS] systems that we are looking at, e-waste is actually one of the bigger components that they have to address, specifically for us."Risk ratings for specific investments also depend on the context of the company in question.For instance, one representative of a large investor explained that rating scores depend on how closely the practices and plans that companies already have in place match the criteria set by the investor.Other interviewees explained that they do not focus on e-waste at this point, but indicated that this may change in the future: "As of now, it is probably not a main priority because we don't see it as an immediate problem in the market.(…) E-waste will be more relevant later on."Even though some investors see e-waste as an important issue, we also found that certain other criteria weigh more heavily in investment decisions.Investors seem to focus primarily on the viability of their investee companies' business models and operations.As an interviewee from a private investment firm explained: "In due diligence, we look mainly at the track record of the company, a lot on the management, the financial side of the company, and their ability to borrow, and then their business model … and how their customer relationships work."According to an industry expert with longstanding experience in the sector, this focus stems from the fact that most OGS companies, even the more established ones, are not yet profitable and continue to rely on subsidies, for example, in the form of concessional loans from DFIs.Moreover, many of our interviewees stressed that they consider e-waste to be a lower-level risk factor, for example, compared to corruption, money-laundering, child labour in supply chains, or human rights abuses.These issues are typically part of exclusion lists and immediately disqualify companies and projects from investments if detected.One interviewee argued that it is unlikely that e-waste would be added to such exclusion lists, despite its recent increase in its importance for investment decisions.
Our interviews also shed some light on the specific ways in which ewaste requirements affect investment decisions.The majority of the investors we interviewed ask potential investees to develop plans for addressing e-waste that will result from their activities, sometimes with the help of technical expertise provided by the investors.We only identified one investor that does not include an explicit requirement regarding e-waste management.However, our interviews also suggest that the stringencies of these requirements differ widely.Some investors have clear requirements regarding the disposal and collection of batteries and panels and include these as legally binding provisions in their contracts with companies.Some grant-issuing institutions also include e-waste requirements in results-based financing, enabling them to withhold funds if companies do not fulfil their obligations.On the other hand, we identified a number of investors that do not define in detail what companies' e-waste plans need to entail.In these cases, whether or not companies present a plan and adhere to it typically does not impact on investment decisions.As a representative of a DFI explained: "We do ask them: Do they have a system in place to reuse end-of-lifecycle products?But if they say no, that's not necessarily a reason for us not to invest."However, we found that, at a minimum, the investors we interviewed require their investees to work exclusively with quality-certified products, which tend to have longer lifespans and therefore help limit e-waste volumes.
Finally, our interviews provide some insights into how exactly investors assess companies during their due diligence and compliance monitoring procedures.Investors that do have e-waste requirements conduct assessments either with in-house staff, by outsourcing to third-party ESG service providers, or through collaborations with sectoral experts.One interviewee explained that the level of expertise allocated to the assessment of a specific issue depends on the corresponding risk rating.Our interviews also suggest that ESG assessments differ in terms of their frequency, from monthly to annual, and the kinds of data they are based on.Concerning the latter, some of our interviewees explained that investors often ask companies to self-report their e-waste management practices, which can lead to low-quality reporting at times.One interviewee explained: "They can say whatever they want … Most of them I've reviewed, they are very nice-sounding words, but it's quite generic.(…) To be honest, I would say a bit of a boxticking exercise."Others said that their organisations use more indepth approaches, combining questionnaires with interviews and site visits.Several interviewees also highlighted that conducting effective assessments is often challenging because investors allocate limited resources to this task.This is especially problematic in cases where the operations of investee companies are spread out over large geographical distances, as in the case of the OGS sector, making it challenging to perform thorough on-site assessments.

Drivers
As explained in Research methodology section, we also asked our interviewees about the key drivers that motivate their organisations to engage with e-waste in their investment decisions.One key issue in this regard concerns the reputational risks of being associated with the social and environmental impacts of increasing amounts of solar e-waste.One interviewee highlighted that this presents a substantial risk, which can be difficult to manage: "[W]hen you have a product that causes damage somewhere in the field, the reputation and the image of the company is immediately tarnished.(…) This is something that spreads like wildfire, really fast, and the customers do take note of that."Several of our interviewees emphasised that their desire not to be associated with e-waste stems less from attempting to avoid a bad reputation and more from a genuine desire to avoid social and environmental harm.Interestingly, our interviews revealed that pressures from journalists, NGOs and community organisations regarding e-waste management currently have little impact on investors.Instead, pressures from the investors' funders seems to play a more important role.Multiple representatives of DFIs emphasised that they perceive it to be important to avoid being associated with e-waste, as this may reflect negatively on them, both in the host country and at home.One of our interviewees from a private-sector investor emphasised that being associated with e-waste could be detrimental to the relationships they have established with their funders: "Our biggest currency is trust.And trust is very hard to build and very easily lost."Importantly, some interviewees pointed out that the impacts of reputational damage do not just concern a single investor or company, but rather the OGS industry as a whole.
Our interviewees revealed that DFIs play leading roles in the adoption of criteria for e-waste management in investments, although there are differences across organisations.For example, one interviewee emphasised that their internal teams are key in driving efforts to adopt e-waste requirements in their investment decisions: "The internal teams are really, really tough, on what we are doing in the future.The system in [the organisation] is really, really tough on how we impact the future."In addition to including e-waste requirements in their investment criteria, many DFIs are also active in providing supplementary services for raising awareness, building capacity for e-waste management in companies and providing financial support for experimental initiatives.In general, DFIs play an important role in the OGS market because, as one interviewee estimated, they currently provide around 80% of finance for companies (see also Lighting Global, 2020).Multiple interviewees emphasised that this, in combination with their mandate to promote sustainable development, gives them substantial influence to promote social and environmental standards in the OGS industry.This influence will likely diminish in the future when commercial, less impact-focused capital becomes more available to companies, for instance, through investment banks or venture capitalists.Many of our interviewees explained that these types of investments typically do not include e-waste requirementsat least not to the same degree as is the case with some DFIsas they are primarily concerned with the profitability of their investments.
Most of our interviews highlighted the importance of industry-led activities in addressing e-waste from OGS devices.We found that GOGLA is playing an instrumental role in raising awareness among investors about the need to consider e-waste management as part of their funding activities.In Kenya, GOGLA has arranged several workshops focusing on e-waste and has been involved in establishing the so-called 'Solar Waste Collective', which consists of seven OGS companies aiming to lobby regulation and to establish partnerships as a collective with relevant waste recycling organisations.Furthermore, GOGLA has provided various solar e-waste guidance documents, including an 'e-waste toolkit',5 and is currently developing standardised guidelines for e-waste management in the OGS sector.An interviewee who is part of this effort explained that this guidance can be used by investors that would like to use a more standardised approach to assessing the ewaste management practices of their investees.Also referring to this guidance, another interviewee representing a DFI suggested that, in the future, investors might prefer to invest in solar companies that follow a more standardised approach to managing e-waste.In that sense, the guidance has the potential to lead to a contagion effect, where its adoption by some companies may induce others to do the same in order not to suffer disadvantages in the market for access to capital.

Barriers
Our interviews also offer insights into the barriers that prevent the more widespread adoption of e-waste requirements among investors.
All investors included in our study seem to agree that solar companies are currently not in a position where they can be expected to be solely responsible for the management of e-waste.Most companies, including the more established ones, are still in the process of setting up financially sustainable business models.As mentioned previously, most of these companies continue to rely on subsidies and are currently not able to sustain themselves based on commercial investments alone.As one interviewee put it: "We really quickly saw that lot of the traditional [ESG] requirements are overkill in this industry right now, because the companies are not at that stage."Another interviewee highlighted that, after an extended period of growth in the OGS sector, some companies went bankrupt, which caused investors to focus primarily on the profitability of companies in their investment decisions.Some investors argued that solar companies may actually increase their profitability by managing waste, for example, through cost savings from the reuse of system components.However, most of our interviewees seemed to agree that setting up the necessary infrastructure to access waste would outweigh such savings.
Many of our interviewees emphasised this last point, that is, the cost of setting up an effective e-waste collection and recycling infrastructure.There is a general lack of both waste transport and recycling services in Kenya, as across East Africa more generally, although there are differences across countries and provinces.Waste transport is particularly complicated due to the large distances over which OGS users are spread out, making it challenging to collect broken devices in a cost-effective manner.Furthermore, we learnt from one interviewee that the certification of waste recycling facilities and transport services can involve high cost and bureaucratic hurdles.We also found that some actors in the sector have thought about increasing the availability of waste to recycle through international waste transport, but that this was not possible due to strict regulations on cross-border waste-hauling.Finally, a number of our interviewees highlighted that, even in regions where recycling capacities do exist, customers often do not return broken devices because of limited financial incentives or for socio-cultural reasons, such as the symbolic value of owning OGS devices.In general, we found that there is a lack of successful examples of e-waste recycling systems, which makes it challenging for investors to decide what they can expect from companies and how many resources to allocate to their support.Some of our interviewees argued that investors are unlikely to require more stringent ewaste management across the board until such examples exist.
Our interviews also suggest that the lack of national regulations on e-waste is a core barrier to the more effective adoption of relevant requirements by investors.Such regulations should set clear rules and define the responsibilities of different actors in the value chain.Due to the threat of sanctions in case of non-compliance, regulation would have a strong impact on companies and their investors.Our interviewees emphasised that regulation would be especially important to incentivise commercial investors to consider e-waste management seriously in their investment decisions.One interviewee highlighted that national regulation would increase the risk of reputational damage to investors, as discussed above.However, as another interviewee put it, regulation of course needs to be matched with adequate enforcement: "Only if they can raise taxes for it, then it becomes a more practical thing."While most of our interviewees said that national regulation is currently not a strong driver to e-waste management, Kenya is preparing legislation on e-waste that may have substantial impact on the sectorone of our interviewees called it a potential "block buster".Another interviewee stressed that the creation of the above-mentioned Solar Waste Collective in Kenya is at least partly motivated by this legislation, providing some first insights into the importance of national regulation as a driver for e-waste management initiatives.

Discussion
Rapid and urgent action is needed to address the rising challenge of ewaste from OGS devices.This is especially the case in countries like Kenya, where a growing market for solar products and an increasing number of devices that are reaching the ends of their lives are resulting in rapidly growing waste volumes.While there are a number of ongoing projects experimenting with different approaches to e-waste management (Efficiency for Access, 2021;Lighting Global, 2020), much more is needed to address the scale of the problem.Our analysis focuses on the role of investors in addressing the e-waste challenge and deals with the question of whether and how they handle e-waste in their investment modalities and practices.We find that some investors do more than others, especially DFIs that are driven by their mandate for impact-focused investments, as well as by the threat of reputational damage from being associated with socially and environmentally negative outcomes.In general, however, ewaste is still very much on the fringes of investment decision-making in the OGS market.Other considerations are currently more important to investors, including the profitability of investments and certain ESG issues that strongly violate ethical business practicesfor example, money laundering or the use of child labour in supply chains.Furthermore, we found that even in cases where investors do put requirements for e-waste management in place, these are often not seen as a reason to exclude companies from investment.Thus, it appears that investors are currently not leveraging their potential influence on investee companies to achieve better solar e-waste management practices.
Our analysis also highlights the key barriers that prevent investors from taking a stronger stance on e-waste.This concerns a set of complex issues that require substantial resources and coordinated, multistakeholder responses in order to be resolved.Firstly, there is a lack of government regulation setting out clear targets and defining the responsibilities of the different actors involved.At the time of writing this article, the Kenyan government is preparing a comprehensive bill on e-waste management, which may address some of these issue.We return to this below.Secondly, there is a general lack of comprehensive waste transport and recycling infrastructure in countries with large OGS markets, including in most parts of Kenya.While existing wastemanagement capacities in the informal sector can absorb a fraction of e-waste volumes (Cross & Murray, 2018), a comprehensive response to this growing problem is likely to require a more formalised approach that makes use of regulated operating procedures that are safe for human health and the environment.Thirdly, and finally, our analysis suggests that investors currently do not take strong action on e-waste as their investees are still in the process of setting up financially sustainable businesses.Even though our sampling strategy focuses on investors in relatively large and established OGS suppliers, our interviews revealed that these too still rely on subsidies.This means that, at this point in time, it seems unrealistic to expect OGS companies to take sole charge of carrying the financial (and operational) burden of setting up effective waste collection and treatment systems.
A key issue that emerges from our analysis concerns the question of who is responsible for the financing of e-waste management systems.The upcoming Kenya e-waste bill is based on the 'polluter pays' principle (Corbyn et al., 2019), which places the financial responsibility on OGS companies and, by extension, their investors.However, as discussed previously, most companies continue to rely on subsidies and therefore currently do not have the required financial means (or operational capacities).Furthermore, companies will likely pass the added costs of waste collection and treatment on to consumers, which will adversely affect sales, as consumers in the OGS market tend to be among the poorer parts of the population.In such a scenario, stricter requirements for e-waste management could potentially contribute to reduce the number of products sold on the market.Requiring OGS companies to carry the cost of e-waste management themselves might also give an advantage to providers of unbranded OGS products (Magalini et al., 2016).This includes products from informal repair shops, which often produce lower-quality devices and which may not be subject to the same degree of regulatory oversight as registered businesses (Lighting Global, 2020).Finally, one of our interviewees pointed out that asking companies to manage e-waste puts a double burden on them, as they provide not one, but two services that are the responsibility of the government in most countries: electrification and waste management.Based on our interviews with investors and industry experts, it thus seems that there is a need to put at least part of the responsibility for financing e-waste management systems on national or regional governments, for example, through taxes.Such system-level investments could also be supported by foreign investors, for instance, by funding host-country governments or in the form of public-private partnerships.Future research could investigate the funding modalities that are most suitable for these types of investments and the drivers and barriers that different kinds of investors (DFIs, impact investors, etc.) face when engaging in them.
Another core insight from our interviews with investors and industry experts concerns the importance of learning in e-waste management.If investors are to take a more proactive role in addressing ewaste through their investment decision-making, then they require information on the best available practices.In this regard, they rely on examples where waste management systems have been successfully implemented, providing insights into the financial and operational requirements involved.Our interviews revealed that many investors currently do not have access to such information.As highlighted previously, there are a number of ongoing experiments and piloting schemes focusing on solar e-waste handling, which may provide some insights (Efficiency for Access, 2021; Lighting Global, 2020).In addition to learning from individual experiments, our interviews also suggest that the Kenyan 'Solar Waste Collective' has been active in sharing and combining information on best practice in solar e-waste management.This presents an important step in combining lessons from local projects in order to distil generally applicable lessons.These lessons are useful to both investors and companies when assessing existing or planned ewaste strategies.As one of our interviews revealed, the creation of the Kenyan industry collective and their efforts in developing standardised e-waste management guidelines are at least partly motivated by the upcoming e-waste regulation.These guidelines, which are currently being developed as the basis for voluntary measures, can inform the development of legally binding regulations in the upcoming bill, which gives companies a chance to take an active role in the latter's design.

Conclusion
This paper set out to contribute to improving the understanding of ewaste from OGS systems, a topic that has received little academic attention so far.We focused specifically on the role of the main investors in the market for OGS systems in Kenya, a leading country in Africa in terms of diffusion rates.Specifically, we explored the question of whether and how investors have included e-waste management in their funding modalities and practices.
We found that, while investors have started to include e-waste management into their existing risk-assessment frameworks, this is not a high priority or concern for them at the present time.To the extent that investors have incorporated requirements for e-waste management into their operations, this is driven mainly by the potential damage to their reputations and by efforts undertaken by GOGLA to encourage a greater focus on this issue in the industry.Investors are dis-incentivised from adopting stricter e-waste requirements due to the associated cost burden put on to their investees given the lack of an existing waste collection and recycling infrastructure.Furthermore, we identified a lack of any comprehensive policy and regulatory framework as a key impediment to e-waste management, although the Kenyan government is currently in the process of introducing such measures.Similar regulatory schemes for ewaste are currently underway in a number of other sub-Saharan countries, including Rwanda and Ghana (Hansen et al., 2021).However, experience from other developing countries that have previously adopted ewaste regulation, such as India, suggest that effective e-waste management is not a question about regulation as such, but more importantly about its enforcement and monitoring (Turaga et al., 2019).
Our paper contributes to provide a more balanced account of the diffusion of OGS systems in Africa, which has tended to focus mainly on the beneficial impacts and investment barriers (Cross & Neumark, 2021).Specifically, we meet the call by Ockwell et al. (2018) for critical research addressing the possibly negative environmental and social implications of the diffusion of OGS systems in Africa.That said, our findings should not be interpreted to mean that OGS systems are intrinsically negative or environmentally damaging in nature.Rather, by drawing attention to e-waste as an unintended side-effect of investments in the OGS sector, we point to the need to cover the full spectrum of the range of effects of OGS systems associated with their diffusion.The findings presented in the paper should be interpreted as a call for greater attention to be paid to the identification of appropriate schemes for private firms and public-sector agencies involved in the OGS sector.As we have argued, there is a need to consider how investors can contribute to addressing e-waste, given their specific investment risk profiles, profitability expectations, the types of funding they work with, etc.As the volume of e-waste from OGS systems is expected to increase over the coming years, it is advisable to take action early on in order to avoid e-waste escalating into an unmanageable level at a later point in time.Finally, in this paper we have focused specifically on suppliers of branded solar products in order to study the role of investors in ewaste management.Future research could benefit from focusing to a greater degree on e-waste management in the market for unbranded solar products given their large share of the market.
• Would you say that e-waste is in the top 5 list of main concerns?• Or is it not among the most important issues currently?4. Motivations to address e-waste • When did begin to consider e-waste management as an important topic?

Table 1
Sample of investors included in the analysis.Source: Authors own elaboration.
• Why have your company become interested in this area?4.1.Drivers • Does it have something to do with (internal drivers) o Reputational risk from ESG impacts?(if so, please elaborate) o Probing: what is the main risk actually?What could happen worst case?o Funders/owners personal agenda?If so, why are the owner concerned about this? o Cost saving related to warrantee systems (avoided costs)?o Other?• Does it have something to do with (external drivers): o External funder's requirements?If yes, why do your investors/partners consider e-waste management a priority?o Pressure from environmental NGOs or journalists (locally and/or internationally)?o Pressure from industry association, GOGLA's, focus on e-waste management (our companies are members of GOGLA, so responding to this industry body) o National e-waste regulation (e-waste strategy) o Customer demand?o Other?• How would you rank the relative importance of these drivers?o Probing: top 3 drivers?4.2.Barriers • Does it have something to do with (internal barriers)?o Limited economic incentives?o Limited internal pressure from partners/internal stakeholders?o Do not want to add another cost burden on recipient companies?o E-waste management as a responsibility of OGS companies?o Limited investment ticket size, i.e. limited contribution to e-waste problem?o Costly to set up sophisticated e-waste monitoring system?o Other?• Does it have something to do with (external barriers)?o Lack of relevant national regulations?o Lack of external pressure from NGOs, industry associations, journalists, etc.? o Lack of customer demand?o Other?• How would you rank the relative importance of these barriers?o Probing: top 3 barriers?