Designing business models that reach and benefit poor women working in agriculture can be a challenge for businesses.
But is that surprising?
The renowned economist Milton Freidman famously once said that the sole responsibility of business is to increase its profits for its shareholders. According to Friedman, businesses do not have a responsibility to make society a better place.
In business, the ownership structure, incentive alignment, financing model, people, processes and products — the entire organisational skeleton — is oriented towards competitive advantage (that is, differentiating itself from other businesses) and profit generation. Only new business models, such as social enterprises, can even attempt to bring social welfare into the heart of business in a financially sound and (importantly) sustainable way.
But before we leap too far ahead, what can current business types do? How can our big multinational corporations help women in agriculture? And more importantly, why should they bother?
The debate on this is hot at the moment. The financial crisis is set to severely jeopardise gains made in the last 20 years in women’s development and empowerment. Last year, the International Labour Organisation estimated that the economic downturn could lead to at least 22 million more women in the developing world becoming unemployed. Worse still, this only covers a fraction of the problem. The majority of vulnerable women do not even show up in official statistics because they are trapped in the informal sector.
And the problems for women in developing countries tend to remain: lack of education, lack of decent and non-exploitative work, and erosion of women’s empowerment.
So we know the ‘what’. But do we know the ‘how’? And more still, how do businesses engage in women’s development and still protect their financial bottom line?
What many people don’t realise is that women actually make up the majority of agriculture workers in the developing world. Seventy five per cent of all farmers and food producers are women. Think about those numbers when you’re next in your local supermarket’s groceries section.
Yet, women face a significant number of gender-specific constraints. Women working on farms have to look after their household as well, which massively increases their work burden. They often don’t have access to decent education and agricultural business training either. Women also miss out on credit services and find it difficult to invest in new assets, such as cattle, seeds or machinery. And ultimately, women often lack the social standing to be taken seriously as managers and supervisors. This imposes what we know as ‘the glass ceiling’.
Because of these constraints, women suffer. In particular, women’s productivity suffers. And for businesses, poor productivity will have negative effects on the bottom line — from difficulties in adapting to new technologies to longer lead times, a lower level of quality or a higher defect rate.
So, where is the opportunity for businesses? Investments that address the underlying factors that affect women’s productivity will produce a stronger financial return. This will mean improving the level of women’s productivity instead of simply increasing the numbers of women involved.
If businesses can find creative approaches to investing in women they could maximise productivity across the entire workforce and throughout the value chain.
Practitioners must identify the key success factors in women’s development that will support the businesses core objectives. Using the ‘gender-sensitive value chain’ approach we can make the following recommendations:
1. Where women are most ubiquitous, provide training to improve farming practices and improve product quality; reduce waste by improving recycling practices; and use local cooperatives to improve women’s bargaining position and the economies of scale and cash cropping opportunities.
2. Invest in women’s health and in labour-saving technology to reduce women’s work burden and susceptibility to sickness and injury, and to improve morale.
3. Make the most of women’s role as lead shopper for food products. Gather market research, develop a local market, gain new customers, create new products and new women’s empowerment brands, and develop the product portfolio. And ultimately, increase profits.
4. Develop future women managers and leaders. Provide agri-business training and graduation opportunities. Remove the glass ceiling and raise women’s self-esteem.
5. To do this, earmark gender and sourcing money by reallocating funds between ‘cost centres’ such as corporate social responsibility (CSR) and code compliance, philanthropy, press and public relations, market research, and development.
6. Finally, tap into the charity work being done by women’s organisations and local village development groups and cooperatives ‘on the ground’ to reduce costs of project implementation, adapt projects to local needs and improve project success rate.
Click here to read Anoushka’s paper, Sourcing Gender: Gender Productivity in Sustainable Sourcing Strategies, part of the New Business Models for Sustainable Trading Relationships project.