While CSO-business partnerships are being promoted by the development community, understanding how they work in practice has never been more pressing if they are to succeed and contribute to achieving the Sustainable Development Goals (SDGs).
We are now applying this framework to understand some specific case studies in the dairy sector in East Africa (as well as the mining sector in Madagascar and Ghana). Although the case studies are still on-going, the research already offers insights about how the original objective and the institutional and market dynamics shape the processes of partnerships, i.e. how they work on the ground in terms of the four dimensions presented above. The Africa Milk Project (hereafter AMP) aimed to tackle poverty and malnutrition issues in the isolated, rural district of Njombe, Tanzania, by increasing smallholder farmers milk productivity and income. That said, the project faced its first limitations: even grouped into a cooperative and supported by the local authorities and diocese, smallholder farmers and cattle owners had limited access to a market, and were not able to reach either dairy processors, nor the dairy consumer main market located in Dar es Salaam - 12 hours ride away. CEFA, an Italian NGO supported by the Italian Development Cooperation, complemented the social focus of the project by setting-up a dairy processing plant in 2004 whose main role is to buy, process and sell the milk of the cooperative, guaranteeing the financial sustainability of the project. Though CEFA succeeded in making dairy products available to Njombe communities, demand remained low - notably because of the lack of awareness of the nutritional importance of dairy products in the Tanzanian diet, threatening the financial sustainability of the AMP. So CEFA launched an additional programme, the Milk for School Programme supported by Italian dairy giant Granarolo, to educate about the benefits of dairy consumption and provide milk to over 25,000 pupils, thus changing their food consumption habits and influencing parents’ dairy purchase. Besides fostering local dairy consumption, CEFA also developed new products - e.g. cheeses, so as to enable the milk factory to exploit further opportunities where there is in fact demand for dairy products, i.e. in Dar es Salaam. Granarolo’s inputs of expertise, knowledge and financial resources played a key role in supporting both strategic choices and allowed CEFA to slightly shift the focus of its role towards what they do best: community relations, training activities etc. So the AMP succeeded in creating a holistic, sustainable model addressing systemic issues in the dairy sector while tackling malnutrition. Though not part of the focus of the project, the AMP also influenced the authorities - e.g. the Milk for School Programme was promoted as best practice while the Southern Highlands (where Njombe is) has been chosen as the future milk hub of Tanzania.
The recently agreed 2030 Agenda for Sustainable Development highlights the need for the development community - including the private sector - to act collectively, and commit adequate resources and efforts to tackle the increasingly interrelated challenges of climate change, poverty, and gender inequalities among others. The rise of the private sector and partnerships and declining importance of aid is illustrated by the figure below, giving the word count of the different words across some of the key development documents since the Millennium Declaration.
The expectations placed on multi-stakeholder partnerships, including CSO-business partnerships, stand in contrast to the literature on CSO-business partnerships results. There is therefore something of a gap between the policy and the practice that needs to be addressed.Multi-dimensional framework
Starting from the view that partnerships are often a challenge to form, initiate and implement in practice, ECDPM set out to analyse the process of establishing and operating CSO-business partnerships and the various actors and factors that impinge on this, based on the following question:
What are the main partnership characteristics and institutional factors that drive and constrain the process of establishing and maintaining effective CSO-business partnerships? Building on an in-depth literature review on the topic (Byiers et al., 2015) we arrived at an analytical framework focusing on four key dimensions and dynamics: 1. Partnership type - or relation to core business; 2. Degree of partner’s engagement; 3. Activities; and 4. Governance structures Across the four dimensions presented in the table below, we also analyse how the history of the partnership plays a role, in terms of initial motivations and objectives, and the influence of external factors, i.e. location, market dynamics and institutions, play out to affect the partnership’s dimensions. The framework therefore combines the partnership literature with a political economy understanding of interests and external factors. This in turn allows us to capture the complexity of partnerships in terms of drivers and challenges, providing insights on moving from policy to practice - the common ECDPM underlying theme. Figure: Word counts in key development documents Table: The four dimensions of partnership Source: Author’s own elaborationProcesses in practice: Dairy in East Africa
We are now applying this framework to understand some specific case studies in the dairy sector in East Africa (as well as the mining sector in Madagascar and Ghana). Although the case studies are still on-going, the research already offers insights about how the original objective and the institutional and market dynamics shape the processes of partnerships, i.e. how they work on the ground in terms of the four dimensions presented above. The Africa Milk Project (hereafter AMP) aimed to tackle poverty and malnutrition issues in the isolated, rural district of Njombe, Tanzania, by increasing smallholder farmers milk productivity and income. That said, the project faced its first limitations: even grouped into a cooperative and supported by the local authorities and diocese, smallholder farmers and cattle owners had limited access to a market, and were not able to reach either dairy processors, nor the dairy consumer main market located in Dar es Salaam - 12 hours ride away. CEFA, an Italian NGO supported by the Italian Development Cooperation, complemented the social focus of the project by setting-up a dairy processing plant in 2004 whose main role is to buy, process and sell the milk of the cooperative, guaranteeing the financial sustainability of the project. Though CEFA succeeded in making dairy products available to Njombe communities, demand remained low - notably because of the lack of awareness of the nutritional importance of dairy products in the Tanzanian diet, threatening the financial sustainability of the AMP. So CEFA launched an additional programme, the Milk for School Programme supported by Italian dairy giant Granarolo, to educate about the benefits of dairy consumption and provide milk to over 25,000 pupils, thus changing their food consumption habits and influencing parents’ dairy purchase. Besides fostering local dairy consumption, CEFA also developed new products - e.g. cheeses, so as to enable the milk factory to exploit further opportunities where there is in fact demand for dairy products, i.e. in Dar es Salaam. Granarolo’s inputs of expertise, knowledge and financial resources played a key role in supporting both strategic choices and allowed CEFA to slightly shift the focus of its role towards what they do best: community relations, training activities etc. So the AMP succeeded in creating a holistic, sustainable model addressing systemic issues in the dairy sector while tackling malnutrition. Though not part of the focus of the project, the AMP also influenced the authorities - e.g. the Milk for School Programme was promoted as best practice while the Southern Highlands (where Njombe is) has been chosen as the future milk hub of Tanzania.
Key lessons
Coming back to our four dimensions, we can draw links between the institutional and market dynamics of the dairy sector and the partnership’s choices:
1. Relation to core business: in a remote area isolated from the main market such as Njombe, social projects take on an important role as private sectors cannot sustainably invest in such areas. Granarolo’s motivation for the partnership was therefore not core business but philanthropy as (i) they are not interested in the limited Tanzanian market, and (ii) even if they were, they would not start in Njombe. While CEFA and Granarolo are currently withdrawing from the AMP to let the Tanzanians take over, the financial sustainability of the project is questioned as the local partners do not yet seem to have acquired the necessary set of skills and competences to further develop the AMP, even by their own assessment. This in turn questions whether core-business-related partnerships can sustainably address poverty when the poorest households are often the most isolated from markets. 2. Nature of the activities: Building a market-based project in an area where the market does not yet exist is challenging and shapes the activities carried out in partnership. CEFA had to address the market deficiencies to sustainably address poverty and malnutrition issues in Njombe, leading them to focus on the whole dairy value chain - combining dairy production, collection, processing and marketing activities. Beyond that, they also contributed to build the local demand for dairy products. These choices impact in turn on the role of CEFA, pushing the organisation to undertake activities they were not familiar with: managing a dairy processing plant, developing a dairy business rather than what they do best: community relations, farmers training etc. The partnership with Granarolo which came later in 2008 was crucial because of the complementarity of expertise and resources it could bring. 3. Degree of engagement: Conducting activities along whole value chains, building relations with communities and authorities and building capacities of local stakeholders (e.g. dairy cooperative) is demanding in terms of time and financial resources. Looking at how these were managed, we can draw some lessons: first, when partners have a role going beyond their field of expertise and core business, they spend additional time and resources to learn and thus less on doing what they are best at: e.g. CEFA dedicated time and resources building on dairy knowledge and expertise, which diverted them from building the capacities of the dairy cooperative to eventually take over even if Granarolo’s engagement in the AMP allowed CEFA to use its resources more efficiently. Secondly, though including local stakeholders allows pooling together such wide range of resources and providing local ownership, integrating them meaningfully in the partnership demands resources and time that may slow down the project implementation progress. 4. Governance: Designing a socially-oriented project can hardly be relevant if it is done without involving the project beneficiaries and other local stakeholders such as the local authorities. This way, the project captures the needs of the poor, but it also ensures the sustainability of the project by giving ownership to, and building capacities of, the local partner organisations. Their involvement facilitated the project implementation in an area where institutions and market are absent, but to make such participation effective, resources as shown above are required. Given the wide literature on partnerships, the analytical framework therefore helps link the external context to the partnership’s four modalities and understanding what, how and why partners do what they do, and consequently how this affects the effectiveness of the partnership. More insights on the process underlying partnerships and in-depth analysis about their drivers and challenges will hopefully come to nourish future recommendations for policy makers willing to better design and support CSO-business partnerships so as to link better policy to practice. This article draws on insights from recent studies by ECDPM: Byiers, B., Guadagno, F., Karaki, K. 2015. From looking good to doing good: Mapping CSO-business partnerships. ECDPM Discussion Paper 182. Maastricht: ECDPM. Byiers, B., Guadagno, F., Karaki, K. 2016. How to assess CSO-business partnerships for development. ECDPM Briefing Note 86. Maastricht: ECDPM. as well as ongoing case studies on CSO-business partnerships, financed by DFID. For further references, see http://ecdpm.org/topics/business-development/This article was published in GREAT Insights Volume 5, Issue 2 (March/April 2016).
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