07 May2009

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This video is taken from the BBC series “The Other America”, which focuses on poverty in Latin America. The short documentary explores three companies (Dole Fruit, CEMEX, and Perhusa Coffee) and their programs designed to integrate the poor into their corporate value chains.

From the BBC site:

“It is not about philanthropy or giving away resources,” says the boss of one of the world’s largest multinational cement companies, when asked what his company is doing lending money to the poor to build houses and supplying them with building materials.

It’s turning a profit on the deal, and it’s not the only one: multinationals growing bananas, coffee, and producing chocolate are not just selling to the poor but working with them.

Several interesting points arise from the video:

CSR Can Help Companies Achieve Their Bottom Line

The example of Dole Fruit illustrated the company’s 300% increase in productivity. Through “patient investment”, CEMEX reached a market that normally would not be able to afford their product – and given Kiva’s repayment rate on microloans of 99.7%, CEMEX is likely to experience similar repayment. And Perhusa was able to reach the growing high demand for niche “organic” coffee.

CSR Should Empower Local Workers and Communities

The Dole banana farmers, after receiving the technical assistance and the opportunity, saw a 30% rise in their productivity levels, an increase in profit, and the cultivation of a higher quality product that allowed them to export to new markets for more money. The man in the video’s son was subsequently able to attend school, the family moved into a larger house, and this all allowed them to expand the space on which they raised livestock.

The CEMEX example allowed families to use the larger space in their new homes to open home-based small businesses. And women were empowered by assuming control over marketing.

CSR Is Not Always Welcomed With Open Arms

Of the 150 farmers that attended the Dole introductory meeting, only seven opted into the program. The video mentioned the “Residual suspicion that big business behaves like a colonial power.” But when you engage and integrate the community into your company’s “value chain”, you provide a sense of ownership and pride. Others will eventually follow.

For more information on Dole and CEMEX, visit:

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One Response to “BBC Video: “Trade not Aid” – Integrating the Poor in Value Chains”

  • max191 October 6, 2009 Reply to

    Definitely a great post. Hats off to you! The information that you have provided is very helpful.
    regards
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