Big companies, small farmers or both?

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Yesterday ONE, along with several NGO partners, hosted a congressional briefing on the economic and global stability benefits of fighting hunger. The event, called “Feeding the Future: Agriculture Development, Economic Prosperity and Global Stability,” was designed to bring lawmakers’ attention to some of the lesser-known benefits of aid to African agriculture, namely that it can be good for US businesses and for global stability. The event got me thinking about the role of the private sector in fighting African hunger, especially in light of USAID’s recent focus on the private sector and agricultural development.

At the World Economic Forum in Switzerland two weeks ago, USAID Administrator Raj Shah announced US support for a plan by 17 companies to promote global food security. I know that there are people out there, a few probably reading this blog, who think that partnering with multinationals is problematic because large companies unequivocally wreak environmental destruction, worker exploitation and unsustainable agricultural practices on their host countries.

However, while some agribusiness companies may be less than stellar in their business practices, it sounds like others are waking up to the fact that working with well-organized groups of smallholder farmers might provide them with a triple (financial, environmental and social) bottom line. As one consultant at the event told me, her client (she wouldn’t divulge the name) has chosen several pilot villages in which to heavily invest in building schools, bringing in teachers, building health systems and teaching people sustainable agriculture practices so that they can grow high-quality products that the company can then buy. With robust monitoring and evaluation of such endeavors, companies can earn the corporate social responsibility cachet that some customers demand.

For USAID’s part, one of the things its new Bureau of Food Security is doing is using its many decades of expertise to show companies the models that work to sustainably reduce poverty and build up agriculture sectors. At the briefing today, we heard from the Mozambique’s head veterinarian. She told the story of how US foreign assistance, the Government of Mozambique and private companies like Cargill, who was also on the event panel, managed to transform the poultry industry in Mozambique in just a few short years, bringing income and food security to many of her compatriots. To quote, “We help them get their profits, but they integrate the smallholder into the value chain.”

It is this sort of responsible partnership that I think will help bring the private sector to poor countries and move them from aid to trade on a large scale. Indeed, it is a long-term endeavor, but one that I think is worthwhile.