Understanding better who benefits from Inclusive Business Models for Food and Nutrition Security
“Inclusive Business Models offer opportunities for economic and social development for certain groups, but they are not effective as means to poverty alleviation”. That finding was presented by Guus van Westen (Utrecht University), coordinator of the Follow the Food project. This entails one of the nine research consortia funded within the second Call of the Global Challenges Programme (GCP) that were all present during their GCP-2 midterm meeting in Kenya from January 15 till 19.
Focus area chosen by most of the GCP-2 projects is Inclusive Business Models for Food and Nutrition Security (FNS). Six of the GCP-2 projects are so-called Integrated Projects that run for four years. Over the last months they went through an internal self-assessment stage as part of their midterm review. To conclude this review, they attended the joint four-day GCP-2 meeting from January 15 till 19 for exchange and learning. The gettogether was held in Nairobi as many of the projects are active in Kenya. Additionally, representatives of the other three consortia of this Call, the so-called Fast Track Research projects with a shorter duration and already nearing their end dates, joined this midterm meeting in Kenya as well.
Interim findings of the GCP-2 projects: diving into effects of inclusive business models on a diversity of African and Asian farmers
The joint midterm workshop served the objectives of joint learning and assessment of progress/accountability: all projects presented their (interim) findings. The LIQUID project identified the effects of cash flow risks of three categories of farmers (men, women and youth) in two types of dairy chains (formal and informal) in Kenya, Indonesia, Thailand and Tanzania. Youth in the informal value chain and men in both value chains face relatively high risks. Important sources thereof are fluctuations in quantity of feed, price of feed and average daily yield. Milk production in the informal value chain is substantially riskier than in the formal chain. Within the ILIPA project great interest has been found with Kenyan farmers for the rearing of black soldier flies as animal feed through awareness campaigns. The insects are strongly benefiting the farmers as they no longer depend on cost-intensive feed for their fish, pigs or poultry. Rather, they can now produce their own feed by rearing the insects on manure and farm waste, a method that is developed by the consortium, which as a co-benefit provides for nutrient-rich composting. The Women Food Entrepreneurs project found, surprisingly, that soil quality in urban slums in Ouagadougou and Kisumu is higher than assumed. Yet, gender specific obstacles faced by Women Food Entrepreneurs groups were found in both study sites. Sometimes, these constraints are “external”, such as poverty conditions, lack of space, resources, access to land, farm inputs, potable water, mobility and access to markets, time and financial and physical capital. Also “internally” the Women Food Entrepreneurs groups face challenges: unequal relationships within groups preventing women to actively participate in decision making and to putting their priorities on the agenda. The ALEGAMS project (Fast Track Research) has seen an overhaul of the Role Playing Game they are developing in a learning process with shrimp farmers for risk assessment in Integrated Farming systems in Vietnam. The farmers signalled that the game needed to include assessment of uptake of new technologies, which has now been realized. Other projects also showed tremendous progress and presented findings that were food for discussion. Through an interactive meeting there was lively exchange on a wide range of themes, such as direct and indirect pathways to Food and Nutrition Security and the role of technology within inclusive business development.
Investment in co-creation processes leads to better research and uptake
The consortia also exchanged on challenges and best practices on working within their multi-stakeholder research projects. This ranged from issues of market development, achieving sustainable results or the co-creation processes with academic and private partners. On the latter it was concluded that meaningful engagement and communication from the early start and continuously throughout project execution is a prerequisite for making optimal use of the skills of the various partners on board and for achieving outcomes. Also, sharing of intermediate findings (through working documents, actor and contextual inventories, market analyses, etc.) and engagement of MSc students can mitigate issues of varying timelines of partners. Further, it was considered that knowledge on the value and the working within an academic research project by all partners sometimes needed to be enhanced before and at the start of the project. It was generally considered that co-creation has added value to the research work and potentially raises opportunities for uptake. An outstanding example of this is the AQUAPONICS project, one of the Fast Track projects that is at its end date. In the project in Ethiopia the conditions for aquaponics systems (integrated fish-vegetable production) to function effectively as business models have been found. Different systems were studied: those held in backyards and those held in large communal systems. For the first system, suppliers of necessary feed have been found and the systems seem to be sustainable. For the larger systems solutions for sustainability have not yet been found. However, the findings of the project have already led to translation of the systems to the Kenyan context by the private partner. And even beyond the region, out scaling is taking place: hydroponics (vegetable production) systems are being built in Somaliland and the Palestinian Territories, building on the findings of the GCP AQUAPONICS project.
Many joint issues related to Inclusive Business Models development
During the midterm meeting conversations were held amongst consortia on cross-cutting themes in the field of Inclusive Business Models (IBMs). Bottom-up approach versus company-led inclusivity was one of the issues discussed. This led to the conclusion that there are different interests of actors for initiating IBMs, leading to a variation beyond traditional business models. The following characteristics were identified for IBMs: 1. Vertical integration, 2. Horizontal integration, 3. Hybrid integration (actors with equal decision-making control). It also came forward that in the development of any IBM both inclusivity and exclusivity need be uncovered. Intermediaries (See f.e. the homonymous project in Nigeria, Republic of Côte d’Ivoire and Kenya) play a role and further increase the diversity of IBMs. Another issue discussed was risk sharing. It was agreed that there is need to recognize different forms of risk – financial, production process, market, social (including exclusion and/or adverse incorporation). Two dimensions of risk sharing were defined: vertical, along the value chain; and horizontal, between farmers. The role of private actors/governance models was found key for encouraging development of risk sharing strategies. A question is whether/what type of role there is for government. Can policy play a role in reducing price risk, environmental risk related to shared resources, or upgrading skills to reduce production risks? Discussions were also held on “durability/viability of models over long term – the transition from subsidy to market”, “information sharing – within value chain and with extra-transactional actors”, “defining the role of the public sector in IBMs – legislation, norms, support” and “the role of technology in affecting inclusiveness”.
As there is such a great amount of angles to approaching the issue of IBM, and the projects have quite a lot to offer in terms of knowledge already, it was agreed that the consortia will join forces and that a special Newsletter issue with various articles will be developed in the course of this year. This opportunity will also be opened to other GCP (as well as Applied Research Fund) projects working on IBMs.
Exchange with Kenyan agrobusiness professionals and visit to agripreneur centre
After these internal exchange days amongst consortia, a public afternoon was held, for which additionally some 45 stakeholders were invited from research, private sector, government and NGO working on IBMs in Kenya. A report and short video of this public meeting can be found on the F&BKP website.
Lastly, on Friday a part of the GCP-2 group visited Latia Resource Center in Kajiao, South of Nairobi. In this demonstration centre some 25 training officials organize training, coaching and advice in business incubation to some five thousand Kenyan small and medium agripreneurs. Trainings are given on-site at the centre with various demonstration plots, cattle and (from simple to hydroponic) green houses, and off-site in the agriculturalists’ own farming areas. Exchanges between the Latia professionals and the research group members appeared to be mutually fruitful.
Please download the full report (PDF) of the GCP-2 midterm meeting.
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Food & Business Research
The Food & Business Global Challenges Programme (GCP) and the Applied Research Fund (ARF) are subsidy schemes of the Dutch Ministry of Foreign Affairs (MoFa), implemented by NWO-WOTRO Science for Global development.
The Food & Business Knowledge Platform is an initiative of MoFa for stakeholders in the field of Food and Nutrition Security to co-create, exchange and use knowledge. The fourth call of GCP is funded and implemented in collaboration with the CGIAR programme on Climate Change, Agriculture and Food security (CCAFS). For more information on the GCP and ARF projects see the Food & Business Knowledge Platform website.
Intriguing quote: “Inclusive Business Models (IBM) offer opportunities for economic and social development for certain groups, but they are not effective as means to poverty alleviation”.
Unfortunately, it is rather less nuanced than the quote in your news item on inclusive Agri-Business in Kenya: “Van Westen in his presentation, Inclusive business and poverty in agri-development, stated that IBMs are a promising development strategy that could help business to develop and thereby lift people out of poverty. Yet they should not be mistaken for a sufficient strategy to combat poverty. That can only be realized when IBM strategies are combined with targeted poverty reduction policies.”
Additionally, it is pertinent to look at the reversed question: how successful have ‘targeted poverty reduction policies’ been which have ignored the key role of (inclusive) business, providing people with income, and government with taxes for public goods and to redistribute wealth?