BANGKOK, Thailand, Aug 28 (IPS) – When Lisa Huyen first set up her company, Vinasamex, which specializes in certified organic cinnamon and star anise grown in the mountainous and poorer provinces of Viet Nam, she faced daunting challenges including market access and securing financial support from banks.
“Developing an inclusive business model around an agricultural product can be challenging,” Lisa says of the difficulties faced by many similar enterprises in the region. You can achieve it with enough love, patience, and a clearly defined mission. Her perseverance, hard work, and investment in human capital has paid off in the past, not only financially but also in a positive social impact on thousands. “Ten years ago our farmers earned an average of $250 per hectare annually. They earn on average $5,000 per hectare each year. Lisa says that the increased income allows them to send their children to school, and give them more opportunities. Vinasamex provides training to their factory workers and farmers from lower-income and minority ethnic communities, 95 percent of whom are female. The training covers international certification standards, ICT, and gender equality.
Inclusive business aims to integrate communities that are often overlooked into their operations. These companies create a value chain by collaborating with low-income consumers as retailers, distributors, or suppliers. This benefits all parties involved. As part of its commitment to inclusive growth, ESCAP partnered with Bill & Melinda Gates Foundation in India, Thailand, and Viet Nam to promote inclusive agriculture business models. This collaboration aims to improve access to technology, services, and platforms for thousands of farmers in the region. The company initially struggled to gain investment and enter the wholesale and retail market. Today, its products can be found in modern retail formats, ecommerce platforms, and specialty organic stores.
“Our impact is triple: we work with over 100,000 smallholder farmers in 12 states via more than 30 farmer organisations. Our farmers can receive up to five percent more than the wholesale price offered by the nearest organized market. Rangu Rao is the CEO of Safe Harvest. “We plan ahead with our partners so that they can meet our requirements in terms of quality and volume, and this helps the farmers to schedule their sowing,” he says. Safe Harvest, in addition to its core innovation – creating a “pesticide free food” product category – has helped India’s smallholder farmers form collectives called farmer-producers organizations (FPOs). This is a new concept for India that combines the benefits of both cooperatives and private companies. Rangu says that by working together, farmers are able to pool their purchases of inputs and better market their products.
Credit to Urmatt Limited
Based out of Thailand, Urmatt Limited has been a 100% organic inclusive company since 1999. Arvind Narula, CEO of Urmatt, explains that the reason for his decision was because he saw a real need in Thailand where most people are farmers and are in constant debt. “Following the fair trade principles, our aim is to create opportunities for economically marginalized and socially excluded farmers. This is done by purchasing rice from our farmers, who are not able to sell their products in developed markets. Arvind says that we also support women farmers to help them take on equal roles and earn a living independently.
Urmatt, which has a strong R&D team, is currently looking for ways to reduce waste and use AI and automation in agriculture. The company developed a food packaging that is 100% compostable at home. This creates a product from rice by-products and gives farmers new revenue streams. There is a clear opportunity for inclusive businesses that can deliver solutions on a large scale. ESCAP works closely with governments and private sector to create policies that increase awareness of inclusive businesses, reward them through targeted incentives and facilitate services that allow companies to develop inclusive models.
By merging profit-driven strategies with a genuine concern for social and environmental impacts, inclusive businesses can pave the way for a region that thrives on sustainability, inclusivity and shared prosperity.
: https://www.unescap.org/projects/promoting-IB-in-AP
Sharon Behn
is Consultant, Trade, Investment and Innovation Division (TIID); and
is Programme Management Officer, TIID.
Other contributors include Marta Perez Cuso, Economic Affairs Officer, TIID and Kavita Sukanandan, Public Information Officer
, Communications and Knowledge Management Section (CKMS).
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