Tuesday
June 21
2011

Lisa Smith

Examining Poverty Footprints and Partnerships

In March, Oxfam America in partnership with the Coca-Cola Company, and SABMiller released a report on their poverty footprint and value chain analysis work. This new report highlights the impacts The Coca-Cola Company and SABMiller are making on poverty within El Salvador and Zambia.

The partnership between The Coca-Cola Company, Oxfam America and SABMiller (as noted in the report, “one of The Coca-Cola Company’s major bottling partners and an integral part of the value chain”) began in 2008. At this time, the three groups agreed to study the ways that the Coca-Cola/SABMiller value chain influences the communities in which they work. This work identifies opportunities for enhancing positive aspects of their current work as well as opportunities for improvement.

Four main objectives led this poverty reduction and value chain analysis (taken directly from the main report):

1. To build transparency around and public awareness of the Coca-Cola/SABMiller value chain community-level effects

2. To provide a platform for engaging business, civil society and government in dialogue about the role of the system in fostering sustainable communities

3. To recommend opportunities for enhancing positive effects and mitigating negative impacts of the Coca-Cola/SABMiller system in the two focus countries

4. To develop joint organizational learning through the collaboration

The Approach

In order to accomplish the aforementioned objectives, a team drawn from each organization conducted three months of field research in the two countries chosen for this initial study. Representatives from Oxfam managed the teams during the period of fieldwork and data collection. The countries Zambia and El Salvador were chosen for this research because of their high levels of poverty, their “sociopolitical diversity and their significant sugar industries, which allowed visibility into the entire Coca-Cola/SABMiller value chain.”

The overarching research approach was based on the Oxfam Poverty Footprint methodology (see also this NextBillion blog by Nathan Wyeth which reviews the same topic). This approach provides a comprehensive understanding of work, its sustainability, and its impact on poverty alleviation. In order to capture a complete picture of the Coca-Cola/SABMiller value chain the following data collection methods (methods that were tailored for either corporate stakeholders or for community stakeholders) were employed at each level of the value chain: informal surveys and interviews with key-stake holders and actors involved in the business model, focus group discussions with employees/workers, livelihood surveys, marketing and consumer practice surveys and direct observations recorded from the members of the collaborative research team.

Oxfam America’s Kyle Cahill, a lead project manager of this study, points out the report’s key findings saying, “…labor conditions, environmental protection and human rights were generally well respected at SABMiller’s Coca-Cola production facilities. In some cases the behavior of the local bottlers was very good, for example HIV/Aids treatment and care in Zambian Breweries and the employee savings cooperative in El Salvador. There are also healthy community water dialogue programs existing in both markets. At the same time, the footprint identified several areas for improvement in labor, women’s empowerment and training, collective bargaining, marketing and the distribution of products, and extending various global corporate programs such as water initiatives specifically on the ground in El Salvador and Zambia.”

The Partnership

While the outcomes of this research are interesting and have important implications for the long-term improvement of BoP-focused business models, the partnership between Oxfam, The Coca-Cola Company and SABMiller provides additional important takeaways. The report points out that trust, time and the commitment of resources and energy are key components in the development of this partnership. While relationships within the selected members of the project team were particularly important, this analysis also required strong organizational leadership and support, which helped in overcoming the differences in culture between each partner organization.

As Kyle points out, “The aim of this report was to understand the impact of the value chains in El Salvador and Zambia – not necessarily to have Oxfam solve problems but rather, to build a strong foundation for engagement with local stakeholders to solve them. So while a big one, this is really a first step. What’s exciting is that building on this foundation of knowledge, the companies have agreed to consider which of these recommendations can be practically taken forward in both markets in the coming months and years.”

It will be interesting to see how these organizations continue to collaborate moving forward; this includes, an interest in additional measurements of impact overtime and a long-term look at the private sector contribution to poverty alleviation. The partnership developed for this study has shown that while research can illustrate positive impacts and success, it can also identify and concretely outline ways to improve upon current work. This openness to change as well as transparency in the data collection and analysis phases of this study is admirable. It is also the approach that will ultimately make the greatest long-term difference in this field.

As I wrote about in this earlier blog for NextBillion, organizations will be more effective at resolving larger social issues if they serve populations and communities in ways that account for intersections of influence. This report provides key learnings from collaborative research that looks at various influences pertinent to each partner. As Oxfam outlines in its organizational statement at the start of the full research report, they prioritize building participatory and accountable processes with stakeholders throughout its operations and value chains. When appropriate, their expectation is for partner organizations to transparently use organizational influence to promote best practices for innovation in development and pro-poor policies. These learnings, and in turn the collaborative research partnership that was developed, serve as a part of the long-term solution to poverty.

For more information on this topic:

The Guardian covered this partnership and report in its Sustainable Business Blog here.

For another interesting report on value chain analysis within the BoP as well as co-creating mutually value in partnerships check out this USAID report prepared by one of NextBillion’s managing partners, The William Davidson Institute.

Categories
Impact Assessment
Tags
corporate engagement, multinational corporation, poverty alleviation, social impact