Competition of export agricultural products has made it mandatory in most countries of the world to adopt Corporate Social Responsibility (CSR) in order to survive. This includes food beverages and other agricultural products. Africa is not an exception as the world has now become a global community.
Companies sourcing their raw materials from the Continent of Africa like other continents are required to meet international regulations and initiatives to remain in business and often times increase their market share. International programs such as the Sustainable Palm Oil Initiative requires multinational companies (MNCs) to apply CSR programs globally. Many members of the CSR consortium for food and beverage companies, AIM-Progress, do business here in Africa. These are also large international brands like Unilever, Coca-Cola, McDonald’s, Mars, Cargill, Carlsberg, Danone, Pepsico, Diageo, and SAB Miller. They have corporate codes of conduct that they expect all their operations to comply with, wherever they are located. Suppliers must also meet CSR standards for responsible sourcing.
These codes of conduct and supplier standards in CSR have led to thousands of CSR audits over the last 10 years in almost every country on the continent. There have been projects to map supply chains for CSR compliance. One such project involved 40,000 mango farmers in Sub-Saharan Africa. Though no one visited or audited 40,000 farms, but surveys, spot checks, and samples allowed the gathering of metrics and other valuable information so that the company could better understand what was happening with their suppliers.
Tea plantations have been assessed for human rights impact. Are the workers there free to leave? Are they bonded or in slave labor? Sugar mills and sugar farms have been reviewed for land grabbing and legal right to work the properties.
Child labor is a common occurrence on family farms. It often happens on corporate agribusiness operations as well. This is generally against the labor code in most countries, even if it is not enforced. CSR looks at these issues and works on continuous improvement towards legal compliance. The goal is to protect companies and brands’ reputations by protecting workers’ rights and following labor laws and health and safety requirements. This could be at a cotton operation or an orange or lemon grower.
Vineyards in South Africa, Cassava farm in Nigeria, local tomato supplier to known local brands such as Dangote Group or Flowers, Fruit and vegetables for export. And don’t forget the animals – Sheep, Cows for beef, dairy, and leather. Poultry and fish on an industrial scale. All these products require CSR assessments if Africa especially countries such as Nigeria that is currently investing heavily on agriculture as an alternative source for foreign revenue and to create employment.
Recently Europe banned a number of food items from Nigeria for different reasons. Food items banned includes beans, sesame seeds, melon seeds, dried fish and meat, peanut chips and palm oil. This is a setback for a nation and the Federal Government is urged to start asking the rights questions – questions such as 1. How did we get it wrong? 2. What can we do to improve? 3. How can we become competitive? Etc. And all these questions can be answered by putting in place the right policies in place to educate farmers. The nation desperately needs to expand its export basket to boost domestic agricultural activities.
Assessments could be for animal health and welfare or employee wages and safety, or even for palm oil product which may contain excess bacteria for the international market, CSR will enable you avoid the embarrassment, save costs associated to litigation, ban / avoidance or high insurance premium and improve bottom-line by opening up new markets, improved productivity as a result of employee satisfaction and public confidence. It will also attract foreign direct investment as investors will clearly be able to assess your market.
The CSR process should therefore be considered as an important investment for both the company and a country that wants to promote export – in fact it is mandatory for the export market.
Written by Greg Gardner and Eustace Onuegbu (May 2016)