Corporations and Nonprofits: Joining Forces for Development

The words “international development” often conjure images of hard working nonprofit volunteers stranded in the middle of Sub-Saharan Africa. Their selflessness and dedication in the face of adversity makes the rest of us seem frivolous. But there are other actors, some less selfless than our imagery of volunteers, which are part of the development community. Increasingly, large private organizations (the size of Wal-Mart) are playing a role in international development efforts. Understandably, the activities of corporations in developing regions are usually fraught with suspicion: aren’t they doing it only for the publicity? Paying close attention to the work of Cargill, a large American corporation, and their partnership with CARE, the international nonprofit, reveals that long term and thoughtfully planned commitments can, on occasion, create opportunities for individuals in the developing world while they tangibly contribute to large corporations themselves.

In the 2011 Index of Global Philanthropy and Remittances, CGP highlighted the work of Cargill Inc in the Ivory Coast. Cargill is the largest privately held corporation in the United States. Cargill maintains extensive cocoa purchasing operations in the Ivory Coast, the largest cocoa producers in the world. It would seem that in the face of such an important player in the international market, individual cocoa farmers would be at a disadvantage. However, in the 2011 Index, CGP featured the story of Charles Yao Yao a farmer was able to increase his crop yield by 50% per hectare by attending one of Cargill’s farmer schools.

By teaching these individuals farming best practices, Cargill ensures itself an increasing supply of cocoa grown to high industry standard. Because of this, Cargill can make long-term commitments to farmers, and can even pay a premium for their products. This is undeniably a win-win. In the international development community this is called creating “shared-value” because both sides have a stake in maintaining a sustainable and fair economic relationship.

The venture has been so successful that Cargill hopes to replicate it. A recent article by Reuters reports on Cargill’s plans in Cameroon, where they will “not only train individual small-scale farmers on good agricultural practices, but will also focus on strengthening farmer organizations”.

What is often left uncovered however is the fact that to overcome the contradiction between profits and development aid, corporations like Cargill reach out to experienced nonprofits. In its work in Africa and elsewhere, Cargill has partnered up CARE. CARE provides the know-how and the manpower to successfully engage with the locals in development activities funded through Cargill.  In Brazil, for instance, the partnership is responsible for helping cocoa growers diversify their income to protect them against economic downturns. In addition, CARE-Cargill has provided producers with a range of other services in hopes of providing better nutrition, sanitation, and education.

Cargill and CARE partnered up to provide children in Honduras and Guatemala "with basic educational materials and nutritious school snacks" as a compliment to corporate operations in their towns.

In part because of their success, it has become less acceptable for donor corporations to simply “write a check”.  Today, nonprofits and responsible corporations are looking for real engagement. CARE is perfectly positioned to discover the ways businesses can responsibly employ incentives to better their own position with suppliers, at the same time that they create better working conditions and secure the futures of farmers and their communities. Private corporations are also moving away from traditional corporate social responsibility models by getting involved in development projects rather than simply funding them.

The bottom line is that it is time to accept the idea that smart corporate giving, the kind described here, is a desirable and sustainable endeavor that is set to endure. In this vein, Cargill’s partnership with CARE should not be the exception. To do so, governments, nonprofits, and corporations should challenge themselves to broaden the incentives for these partnerships to become the norm. So long as nonprofits are as responsible and serious as CARE, and corporations seriously look to secure long-term economic relationships with suppliers, this sort of activity is on solid-footing and ready for public vetting and successful replication. Who knew corporations and nonprofits could compliment each other so well?

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