Since 2011, the Danish food retailer Coop and the international NGO CARE have worked together to promote sustainable trade with Africa in the Kilimo Biashara project in Kenya. Smallholder farmers contribute 80-90 per cent of agricultural production in Africa and are at the heart of economic transformation of the continent.
As demand for agricultural produce increases worldwide, integrating small-scale producers in global supply chains offer both opportunities and challenges for retailers, buyers and farmers.
Coop, CARE and Kenyan vegetable producer Sunripe are working together to develop Coop’s sustainable sourcing from Africa. The project is testing a more inclusive and sustainable business model in which small-scale farmers are better positioned to benefit in Coop’s supply chain. In the setup, mutually beneficial trading relationships are built, and bottlenecks addressed, to do away with the typical challenges in global supply chains. These challenges include water and land conflicts, high levels of waste, pesticide residue, poor produce quality as well as unstable supply of produce and small volumes.
Sustainable delivery chain
For Coop, Denmark’s largest member-owned retail company, the partnership has been driven by an interest in testing new ways of securing a reliable and sustainable supply chain for agricultural food products, while at the same time strengthening the commercial, social and environmental dimensions of the supply chain.
“In Coop we had to look to new markets in order to secure a safe and stable delivery of premium quality fruits and vegetables,” says Jesper Frederiksen, Head of CSR Projects and Partnerships at Coop. “This project has helped Coop develop new business opportunities that benefit both our customers, our business as well as small-holder farmers. At the same time it has helped us advance our thinking and ambitions in terms of how to integrate social responsibility further into Coop's business model,” he says.
In the partnership, Coop works with CARE, and the Kenyan supplier of vegetables, Sunripe, to solve the challenges and barriers that prevent Kenyan smallholders from supplying their produce to the Danish supermarket group and other markets and to benefit from the trade.
For CARE, the partnership fits perfectly with the organisation’s ambition to open new markets for farmers in developing countries and hereby increase incomes and access to food. Through the project, the Kenyan farmers have gained a better understanding of market dynamics and upgraded their farming skills. As a result, farmers have diversified both markets and produces thus improving the competitiveness and value of their farming business.
Also, through this joint initiative, the value chain governance has been strengthened, with farmers being better organised and multi-stakeholder forums for dialogue established between buyers and farmers. 500 smallholder farmers in Kenya are today able to produce higher quality produce and meet competitive standards in the market.
“We have learned tremendously about the global food market dynamics and how the corporate sector operates,” says Nanna Callisen Bang from CARE Danmark. “It has been very rewarding to see our knowledge about rural market dynamics, smallholder farmers and sustainable farming practices in Africa come into play and be of value to a large retailer like Coop and an African supplier like Sunripe in Kenya.”
Project partner and critical friend
Since the beginning, the project partners have collaborated and developed a strong, trust-based relationship. This has proven to be a cornerstone in the initiative’s success.
“Coop and other retailers can play a key role in improving the living conditions for small-holder farmers. However, we do not have the knowledge needed to turn ideas into reality. By combining CAREs competencies and insights with Coop’s commercial logic, we have been able to show that it is possible to promote sustainable production in developing countries in Africa,” says Jesper Frederiksen.
The strong relationship between the partners has made it possible for CARE to raise concerns with Coop at different occasions, in order to promote positive change and strengthen responsible sourcing practices within the retail organisation.
As partners, Coop has been briefed by CARE on some of the company’s major CSR related risks and potential negative human rights impacts in the supply chain.
CARE has a set of principles for corporate engagement, stating that CARE will share project learnings including challenges to enhance sector dialogue. The purpose of the sharing is to contribute to wider knowledge generation in the agri-business sector as well as to promote more responsible supply chain management. This shows that CSOs can retain both the critical watchdog role – also in the case of a close partnership
“Gradually, we build trust and recognise that we all – as partners across sectors – have valuable competencies and resources that we bring into the partnership. This, I believe, is the foundation for innovation and a solution for finding new ways of tackling challenges in a smarter way,” says Nanna Callisen Bang.
Preparing for risk management in a complex global supply chain
With a strong partnership between Coop and CARE and good results locally in Kenya, the partners are now identifying the right entry points to scale up the complex project learnings within Coop. In order to do so, CARE and Coop have committed themselves to capitalise on the learnings of Kilimo Biashara and initiate a pilot project focusing on how Coop, in collaboration with CARE, can work more systemically with identification of risks and business impacts in global supply chains in line with the UN Guiding Principles on Business and Human Rights.