OXFAM recently published a report looking at the 10 biggest food and beverage companies climate practices called “Standing on the Sidelines”. The data collected from these ten companies reveal a threatening cycle of emissions and environmental damage – that while agricultural yields and prices are drastically affected by volatile climate crises, they are at the same time contributing to greenhouse gas emissions that create the volatile climate. This report shows that our food systems are ultimately flawed if they don’t take future production sustainability seriously and responsibly. Creating markets and incentives for sustainable food production is more important than ever to ensure that our food production is part of the problem rather than the solution. Ethical businesses that put sustainable values into practice like the cooperative-owned import company Ético, and the hundreds of companies that purchase from farmer cooperatives that practice reforestation, carbon sequestration, and soil conservation are actively working to reduce that blue slice above that represents industrial agricultural production emissions from the biggest ten food and beverage companies in the world. Studies such as the Rodale Institute’s paper on Regenerative Agriculture show there are concrete actions that farmers can take to reverse the negative impact of food production. What else can we do to build and support the supply chains that value regenerative farming practices to make them the leading examples in the food and beverage industries?
This year Social Business Network and the Juan Francisco Paz Silva Coop are excited to announce two scholarships for high school graduates from Achuapa, Nicaragua to attend the National Institute for Higher Learning in Oriental Medicine (IESMO). The Japanese-funded University offers an accredited five-year program in acupuncture and shiatsu massage. For decades the farmers Cooperative has supported a small acupuncture clinic to provide alternative healthcare options to residents, and seven years ago offered the first scholarships to two young women from rural communities to study in the capital. One of them has returned to Achuapa as a licensed Doctor of Oriental Medicine, where she has worked with the cooperative to expand the clinic and stock an herbal pharmacy. This year she also taught an introductory course in herbal medicine to a group of women in the Recognition of the Unpaid Work of Women Initiative.
Along with the expansion of the clinic in Achuapa and the decision to offer another round of scholarships, awareness of holistic alternatives to mainstream medicine is gathering support in Nicaragua. As private reiki, massage, and acupuncture clinics spring up in every major city, the Ministry of Health trialled the inclusion of one natural medicine practitioner at public clinics in Managua. The new program has received strong positive feedback, with many residents choosing to use massage or acupuncture as a treatment on the public health system. The Ministry of Health recently announced a plan to open a position for a natural medicine practitioner at clinics in four other cities in Nicaragua, creating even more job opportunities for graduates of IESMO. The farmers coop in Achuapa realizes that this growing demand for alternative health care doesn’t only provide the opportunity for them to support young people on a career path in natural medicine, but also opens up a new local market for farmers to grow and process herbs for natural remedies.
The first recipient of this scholarship is Diosmara Rayos, 19. Diosmara is a bright young woman who has shown her dedication to studies for many years: without an available high-school near her rural community, she left home at 14 to attend the high-school in Achuapa, where she graduated at the top of her class and then studied English for two years at a community college in Esteli before hearing about the scholarship for Oriental Medicine. She comes from the small community of La Arinconada in Achuapa, a land cooperative formed during the Agricultural Reformation in the 1980’s. She became familiar with oriental medicine when her mother began treatment for a life-threatening illness at IESMO, where she was treated by Japanese doctors for over nine years. Diosmara says she was inspired by her mother’s experience to study acupuncture and massage. We are very proud of her decision and thrilled that at the end of her first semester she is among the top students in her class!
Social Business Network and Ético bring actors together from every link of the supply chain to build mutual understanding and drive innovation and social change. An integral aspect of this work is good communication, often involving translation, deep levels of cultural understanding, and use of clear images. A high dose of creativity helps of course! Here is a beautiful example of how Social Business Network partner Thanksgiving Coffee uses imagery to educate their consumers about the many production stages in their coffee supply chain:
Make sure to check out the Spring 2014 issue of the Fair World Project’s publication For a Better World. It features an article by Social Business Network director Nick Hoskyns on the Roots of Revolution, and photos of the fantastic ladies of Wikilí, Achuapa and one of the first cupping labs build in the hands of coffee producers. You can also read the article online, spread the word – the revolution for a better world continues!
In January Social Business Network’s director Nick Hoskyns traveled to Uganda and Rwanda with the Thanksgiving Coffee Company to visit several coffee cooperatives.
Nick brought his expertise in cooperative development to help deepen the relationships between the coffee growers, cooperatives, and buyers and resolve some transparency issues. He reflects afterward on the relevancy of his years of experience in Latin America in other continent, showing the universalism of cooperative business model. “Uganda and Rwanda are beautiful and fascinating in their own ways with a lot of potential and really wonderful people.”
You can read more extensively about the trip on Thanksgiving Coffee’s blog.
In this guest blog Social Business Network/Ético intern Nora Burkey applies the frameworks outlined in a classic text used in many business and development schools to form an analysis of Ético’s business model:
In their newly revised book “Reframing Organizations: Artistry, Choice, and Leadership,” Lee Bolman and Terrence Deal maintain that people live their day-to-day lives as parts of many complex organizations, from schools to sports teams, from families to the working world, and more. Cooperativization in Nicaragua is a very clear example of how people commit to organizations, and likewise Ético: The Ethical Trading Company provides another example of organization in the workplace, as it is a company 100 percent owned by organizations who work together. As a very innovative company that at its core is promoting a fairer model for international trade, how can Ético show that managing so many organizations and interests is not only possible, it is better?
As the United States has ruled that corporations may be considered people, at least symbolically, perhaps it is not so strange to consider Bolman and Deal’s point that companies or organizations need ethics, or a soul, to survive. They need a sense of identity. Bolman and Deal write,
Many would scoff at the notion that organizations can have soul, but there is growing evidence that it is a critical element in long-run success. A dictionary definition of soul uses terms such as “animating force,” “immaterial essence,” and “spiritual nature.” For an organization, group, or family, soul can be viewed as a bedrock sense of identity, a deep confidence about who we are, what we care about, and what we deeply believe in….Growing evidence suggests that tapping a deeper level of human energy pays off (p. 396).
Quite possibly it is the very soul of Ético that makes it function so well. Ethics, and giving voice to more people within an organization is not only moral, it is equally if not more efficient than power concentrated in the hands of one leader or one owner.
In their book, Bolman and Deal present four frames with which to look at and understand organizations. Their purpose in doing so is to help organizations better manage themselves, as “modern mythology promises organizations will work splendidly if well managed,” (p. 8). Although, they say, there exists book after book on how best to manage a company or organization, very few people understand the importance of joining solutions together and understanding organizations through many different lenses. This is critical, as organizations are made up of individuals who all see differently. Viewing Ético and the cooperatives they work with in light of the four frames outlined by Bolman and Deal gives a better sense of their function, mission, and effectiveness.
The structural frame emphasizes goals and roles for a unified strategy that produces output. The workplace can be viewed as a factory, whereby “the ethical imperative of the factory is excellence: ensuring work is done as well and as efficiently as possible to ensure high-quality output” (p. 400). There are many examples of high-quality, unique and individual output in the work of the cooperatives and Ético. The Body Shop (TBS) buys quality sesame oil from one of Ético’s shareholding cooperatives, Juan Francisco Paz Silva (JFPS). When the price of sesame rose in 2008, The Body Shop and the JFPS Coop renegotiated what the new price was going to mean, and in doing so authored the unique “Recognition of the Unpaid Work of Women.” As an additional example, cooperative members have created their own unique products, from sesame candy to hibiscus wine, all of it at a level of quality that both The Body Shop and small farming communities can be proud of.
In the human resources frame, the organization can be viewed as a family. Bolman and Deal write,
Caring—one person’s compassion and concern for another—is both the purpose and the ethical glue that holds a family together….A caring family or community requires servant leaders who serve the best interests of its members and stakeholders. This implies a profound and challenging responsibility for leaders to understand the needs and concerns of community members so as to serve the best interests of individuals and the community as a whole. The gift of the servant leader is love” (p. 402).
Both authors acknowledge that it seems strange to talk about love in terms of organizations, but maintain that a successful leader of an organization is truly a servant, and serves out of self-less love for the family or organization. The very structure of Ético relies on servant leadership. Historically, The Body Shop had been buying from the JFPS Cooperative before Ético existed. In fact, Ético was born when L’oreal bought The Body Shop to preserve the direct relationship between the JFPS Cooperative and the renowned cosmetics line. What this demonstrates is that Ético was born out of service to the cooperative when the farmers needed a new type of leadership to be able to continue working with a large multinational company.
In the political frame, the workplace can be seen as a jungle where there is a constant battle and the routine seeking-out of self-interested gains. “In a world of competing interests and scarce resources, we are continually compelled to make trade-offs. We cannot give everyone everything they want, but we can honor a value of fairness in making decisions about who gets what” (p. 403). Bolman and Deal maintain that leaders can ensure this type of justice in the workplace by putting power in the hands of employees. “People with a voice in key decisions are far more likely to feel a sense of justice than those with no seat at the table” (p. 403). In the cooperative model, members gets one vote no matter how much land or money they have, and no matter how much they supply to the cooperative. By working with cooperatives, Ético ensures that it works with the most marginalized groups, the smallest of farmers, giving them as much as say as those better off, creating a sense of justice in being a cooperative member.
Finally, in the symbolic frame , “An organization, like a temple, can be seen as a sacred place, an expression of human aspirations, and monument to faith in human possibility. A temple is gathering place for a community of people with shared traditions, values, and beliefs” (p. 405). Above all, workers must feel that the organization is doing something worth doing, that there is some significance to their work. As the founder of Ético has been with the cooperatives from the beginning, instrumental in their creation, Ético is an outgrowth of the existing family. Together, that family has many traditions. For example, each year the cooperatives and Ético share traditions, such as putting on an annual music festival, and so far these traditions have not been broken. There is a very real sense of community, and based on conversations with cooperative members, there is the belief that the cooperatives, as well as Ético, are there to help. The cooperatives believe in what they do and therefore members believe in them too.
Nora Burkey is currently a candidate at SIT Graduate Institute for a Master’s in Sustainable Development. She became involved with Social Business Network in August 2013 after connecting with Dean’s Beans Organic Coffee Company, a trading partner of ÉTICO. She currently lives in León, Nicaragua, and plans to continue working with Dean’s Beans and Social Business Network on development projects into 2014.
This year, in the face of the leaf rust blight that has devastated coffee farmers across Latin America and the added insult that the coffee price on the international market have taken a sharp dive over the past year, Social Business Network has joined forces with The Community Agroecology Network and a farmer’s cooperative outside of Matagalpa called the UCA San Ramon to try to turn the onslaught of this double disaster into a turn for the better.
One of the small member cooperatives of the UCA has been hard hit by the leaf rust, losing up to 85% of their harvest this year. A walk through the coffee parcelas reveals not only the damage of the fungus but also signs of underlying stress and neglect – vines cover the coffee trees in certain areas, and in others the forest floor is bare and eroding. The farmers recount the difficulties they face – first among them, the rising cost of fertilizers and fungicides, and difficulties securing financing. Then the increased intensity of the diseases, which mean even more financing needed to purchase larger amounts of fungicides, narrowing even farther their profitability margin.
Historically this community has grappled with “organic” farming. After a bad experience with poor technical assistance and costly certifiers, mentioning the word to any of the coop members sets off a tirade of a million reasons why “organic farming” doesn’t work. Lack of quality organic fertilizers on the market and strict certification standards that rely heavily on verifying what farmers are NOT doing (NOT applying any agrichemicals, NOT using any non-certified off-farm inputs, not even their neighbor’s cow manure) have left many farmers frustrated and with the impression that organic farming means doing nothing and leaving everything up to mother nature.
Our new collaboration has kicked off by organizing a series of workshops bringing together the coop members, a local succesful bio-dynamic coffee farmer, and an agronomist. For two days, we transformed a local school into a laboratory complete with microscopes and a centrifuge. Even though the farmers have had their soil tested before, the samples are sent away to a laboratory and no one learns how the tests work. Using a type of soil test called chromatography which reveals mineral content but also the microbial life of the soil, farmers were able to perform the entire soil test in their own community. The agronomist, after a straightforward presentation on several different types of beneficial and detrimental fungi that either attack coffee plants or contribute to the plant’s better absorption of nutrients, went with the farmers to gather soil samples from around their farms and then used the microscopes to identify and see the different physical structures of different fungi. Demystifying the invisible biological world that impacts so directly farmer’s livelihoods will hopefully not only empower them in this moment of crisis by giving them a new understanding of part of the crisis, but also impact how they manage their land. Although it is common knowledge that the leaf rust virus travels by spores through the air, seeing the millions of tiny round balls on each leaf (see the image header on this post) revealed clearly how this fungus has been able to cause such devestation in the region. Examples of beneficial fungi that were found locally were isolated using the microscopes and then used to innoculate seeds in sterilized soil to reproduce them and use them in a fertilizer that can be elaborated on-farm, improving the coffee plants absorption of minerals and nutrients in the soil.
The local farmer leading the soil chromatography process was very clear that this was not a workshop to promote organic agriculture, it was a workshop to promote better agriculture. His own farm has only suffered a 15% decrease in production due to the leaf rust, well below the 50% national average. In any other year he might have been met with glazed looks and disinterest from this group of farmers. But this year, when the management systems they use have failed to mitigate the impact of this blight, their interest was keen, everyone participated, and they requested another workshop to continue deepening their understanding of soil life and assistance in using beneficial fungi to innoculate the new coffee seeds they will be planting to replace the portion of their farms that have perished due to the leaf rust. Studies have shown that in small farmer cooperatives where management of the coffee and soil is tended to more carefully, there is less presence of rust. Revealing the direct relationship between management and soil biology cuts through the layer of faith in purchased inputs that disempowers producers. With the right approach, the double crisis hitting small coffee farmers right now could be transformed into an opportunity to reinforce better management practices that will help protect farmers and their livelihoods over the long term.
Social Business Network is thrilled to have the support of the UK Nicaraguan Embassy, who recently awarded us a grant to deepen the impact of the Recognition of the Unpaid Work of Women in agricultural cooperatives. The grant will be used to pilot the next phase of development in the women’s empowerment initiative with the Juan Francisco Paz Silva Cooperative, focussing on cultural and entrepreneurial education for women. The initiative began three years ago and the ongoing funding, generated entirely through incorporating the unpaid work contribution of rural women into the costs of the cooperatively produced sesame oil and coffee, has largely been invested in savings incentives and technical assistance so that rural women have access and support to participate more fully in the local economy. The support of the UK Embassy provides the cooperative with the means to push the initiative forward in its development, providing a core educational course in cooperativism, entrepreneurship and gender equality; additional skills-based workshops; marketing support; and the creation of a mural in the center of town recognizing the unpaid contribution that women make to community and family well-being. This initiative has already become a model for other agricultural cooperatives, who adapt the principles to their own communities and contexts. We are excited to see this initiative move forward and know that many other communities will also benefit from seeing the results of the additional support of the UK Embassy. You can follow the Juan Francisco Paz Silva Cooperative’s achievements and other great initiatives in Nicaragua on the UK Embassy in Nicaragua’s facebook page. Adelante!
This year Nicaragua hosted the 2013 Human Development and Capability Association’s annual conference. The three day event was held in the University of Central America and the participants represented a diversity of organizations and universities from 44 different countries. The final speaker of the conference was Joshua Cohen, an American philosopher and professor at Stamford University. His talk focussed on his experiences bringing together students from CA and Nairobi to design mobile technology innovations that address health and human development. His examples included several pilots that failed – point being, it’s important to fail and learn from your failures so you can apply that to your next pilot. As long as your keep trying, you will have success.
In the Q&A, Social Business Network’s representative at the conference asked Cohen why it is acceptable for individual startups or pilots to repeatedly fail, while other models of business development such as cooperatives are written off when they fail. While unfortunately Cohen agreed but couldn’t offer any further insight, it is worth considering when analyzing supply chains. Many critics of Fair Trade, for example, will cite a failed cooperative business as proof that the model doesn’t work. But how often do you read that private corporations are an inadequate model for development because one goes bankrupt? We are quick to forgive or blame individuals for embezzlement, tax evasion, or bad management, but when the same problems occur within a cooperative or social business setting the structure is often scrutinized rather than the individual.
Founding director of Social Business Network, Nick Hoskyns, talks about the importance for there to be a reason for a cooperative. Because of the inherent egalitarian structure, cooperatives are often seen as an appealing method for social development. But problems occur when the formation of the cooperative is seen as the end rather than the means to the end – with the goal being creating a successful business. Cooperatives that are formed for the sole reason of bringing people together to raise themselves up out of poverty rarely succeed. Cooperatives are successful for the same reasons that private businesses are – they produce a quality product for a growing market. And they fail for the same reasons that private companies fail – market shifts that make the same product cheaper from another source, bad management, or poor leadership. successful cooperatively owned brands such as Ocean Spray, Cabot Creamery, and the Co-operative in England are not exceptions to a rule, they are examples of good business ethics and skills applied to a model that builds leadership and democracy, and encourages equal wealth distribution.
First-ever initiative to count the unpaid work of women in agricultural commodity production is successful in Nicaragua
Ético: The Ethical Trading Company Ltd., British NGO Social Business Network, and Nicaraguan farmer cooperatives celebrate the ground-breaking innovation to Recognise the Unpaid Work of Women in Ethical Supply Chains.
Ético: The Ethical Trading Company and British NGO Social Business Network are pioneering the first ever initiative to Recognise the Unpaid Work of Women in Ethical Supply Chains. Traditionally, the price for commodity products include only direct input and labour costs, and fail to recognize or take into account the supporting unpaid work which is done mainly by women. This is the first time that rural women’s unpaid work has been recognized as a necessary input into production and one that should be valued and remunerated. This initiative was presented on July 3, 2013 to a group of 100 invitees, including representatives from Fair Trade companies Twin, Equal Exchange, and Liberation Nuts, the Nicaraguan Embassy, UK Government officials and Tesco. The event was organized by Ético and Social Business Network, with support from Hoare’s Bank, the Bulldog Trust, and Raleigh International. The speakers explained the pilot stages and preliminary evaluation of the initiative with small-farmer sesame and coffee Cooperatives in Nicaragua.
The initiative developed in 2008 during a visit of the Body Shop with the Juan Francisco Paz Silva Cooperative in Achuapa, Nicaragua. Ético gender advisor Catherine Hoskyns conducted a pilot study of women’s labour in sesame production. Her initial findings revealed that when women’s indirect labour (eg. cooking food for field labourers) and more general domestic work are included, this counts for around 22% of the total labour input in sesame. The results of the study were used to apply an additional cost to the price of the sesame oil for cosmetics, and has since been used to apply similar costs to the sales of coffee from Nicaraguan Cooperatives. The Cooperatives use the increase in price margin to organize women’s empowerment activities in their communities, such as education, savings and loans schemes and labour organisation, which bring women together and strengthen the cooperatives.
The event on July 3 demonstrated the transformative power of integrated supply chains. It was held at 2 Temple Place and chaired by Albert Tucker, Director of Social Business Network. The opening speech was given by Fiona Woolf, Lord Mayor Elect of the City of London and Trustee of Raleigh International, whose inspiration to support the event came from a visit to Nicaragua in 2012 where she was present at a meeting of women participating in the initiative. She spoke of the impact that listening to the women’s experiences working with the program of the cooperative, and concluded, “That’s why… I will also be a champion for the unpaid work of women. I think it has huge applications across the developed world as well as in the developing world.” A vivid account of the different types of unpaid work which women do in Nicaragua was given by Julia Perez, of Achuapa Nicaragua, and Liberty Pegg, a former volunteer with Raleigh International. Catherine Hoskyns explained the initial calculation of women’s unpaid labour in sesame production and its significance, and Felicity Butler gave her first findings about the impact of the initiative. She is researching this through her Ph.D. at Royal Holloway University, which funded by the Economic and Social Research Council (ESRC) and The Body Shop. Rachel Lindsay, representative of Social Business Network in Nicaragua, gave an overview of how this concept has been piloted in coffee sales and the support it has generated from the entire supply chain. Christina Archer, Senior Buyer for Community Fair Trade Ingredients at the Body Shop, gave a testimony, emphasising that “This initiative does also make really good business sense, and strengthens the sustainability of supply chains… Our brand is about building self-esteem and empowering women, be they the women who use our products or the women in our supply chains”. The event was concluded by Nick Hoskyns, Founding Director of Ético, who emphasised that when you bring together committed partners, you can use business to effect real change. He emphasised that it was not easy to get this far but “with such good collaborators, many of whom are present, we have shown that we can still make trade fairer, just as we did with the establishment of Fair Trade”. He also credited the cooperative organisations with being instrumental in the implementation of this initiative and using the additional funds so effectively for women’s empowerment.