Let Good Things Grow…

Let Good Things Grow…

6 August 2014 13:04 - by Monica Middleton - 0 comments

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I am heartened by the UK trend towards investing in Goodness - where individual and organisational investors get more than just a financial return on their investments for profit, people and planet.

Oikocredit enterprise partner APPBOSA (Peru) - A Fairtrade, organic, sustainable social enterprise

Oikocredit, a social investment cooperative nearing its 40th year of operations, is widely acknowledged to be one of the world’s leading organisations in the “ethical-investing-for-good” space.

At the outset of Oikocredit’s recent AGM in Peru, Oikocredit announced a 2% dividend for its individual and organisation investors. Impressively, this same stable dividend has been paid out every year to its investors since 2000, including the recessionary period. 

Given the countries around the world in which Oikocredit operates, the cooperative keeps enough cash on reserve to mitigate financial and country risks, and to ensure that its investors have always been paid back when they’ve requested it. So not only does Oikocredit put its social mission first – it manages to run a very robust business in the process.

In the UK, Oikocredit’s investors understand this combination of social mission and sound business, and buy wholeheartedly into this balancing act; adopting a long term, ‘savings’ mind-set by taking out depository receipts (shares) in the Oikocredit International Share Foundation, for any amount between £150 to £500,000+, and in a choice of currencies.

Many investors also choose to be actively engaged in the organisation - giving direct feedback/ideas, attending events, visiting the field etc. All of which makes for a more unique, open, and enriching environment in which to operate. 

For me, what steers this diverse collection of engaged investors, employees, friends and volunteers, is the fact that Oikocredit fervently adheres to a triple bottom line objective of serving profit-people-planet.

So at its AGM, Oikocredit also reports back on its annual social performance data alongside the aforementioned financials. Here Oikocredit shares various indicators of positive social change - potentially derived as a result of activities undertaken by its microfinance and social enterprise partners in the developing world.

These indicators cover such aspects as poverty reduction, increases in local employment, and growth in the number of enterprise partners who have an environmental imperative, to name but a few.  And despite the inherent (but hugely worthwhile) complexities of such monitoring, it seems that Oikocredit has a good track record in this sphere of social performance monitoring, having received an 'excellent' rating by Planet Rating who in 2013 concluded:

“The current strategy and actions of Oikocredit suggest that indeed it is positively contributing to the social change it aims for, and particularly to financial inclusion”.

The aim of such monitoring also ensures that Oikocredit remains ‘on mission’ – namely, helping to alleviate poverty, and to impact the lives of people who have no other means of obtaining finance to set up and run their own ventures and aspire to self-sufficiency – e.g. micro-creditors, small businesses, agricultural Fairtrade and organic cooperatives, renewable energy projects etc.

Organic, Fairtrade bananas from Oikocredit Enterprise Partner APPBOSA, Piura, Peru, June 2014

So I find the social monitoring presentation to be rich, insightful and engaging; providing useful numbers behind the potential impact of such investments, which can only be topped by seeing the evidence of this change in practice, and by speaking to the end beneficiaries of such financing.

This is where delegates of the Oikocredit AGM (myself included) are fortunate. Alongside presentations about financial figures and social performance indicators, we also take the opportunity to visit some of Oikocredit’s Peruvian enterprise partners and their end beneficiaries, including organic and Fairtrade coffee, cocoa and banana cooperatives, and micro-creditors.

Because I’m rather partial to bananas, I chose to visit APPBOSA, a small farmers’ cooperative producing organic and Fairtrade “Cavendish Valery” bananas. Created in 2003 with 108 farmers, APPBOSA now has 350 farmer-members whose incomes support their wider families and communities.

Whilst the global organic market for bananas is relatively small, it is also growing. With five international buyers, and accreditations from Fairtrade and Global Gap, APPBOSA now exports its produce abroad, including to the USA and Europe.

A critical part of this growth is attributed to Oikocredit, which began providing finance and capacity building support to APPBOSA in 2007. At the time, production was limited by conditions and machinery, requiring that farmers collect, wash and transport their bananas in wheeled carts between small individual farms covering large, low lying areas.

Before Oikocredit

With a credit line of US$ 150,000 from Oikocredit, APPBOSA have been able to semi-mechanise the process, constructing simple conveyor belts and cableways to transport the bananas from each farm to roofed packaging stations for washing, selecting and packing.  The net result being that APPBOSA now produces 1885 boxes of bananas per hectare per year, above the Peruvian industry average of 1,500. And in 2013 it was awarded first place in Peru as a sustainable exporter of organic bananas.

After Oikocredit

Beneficiaries such as the banana farmers of Oikocredit’s partner APPBOSA in Peru are just one group of people making up the estimated 28 million (previously financially excluded) borrowers reached to date through Oikocredit’s enterprise partners in this way.    

So whether it’s growth in profits & dividends for investors, growth in positive social & environmental indicators for people and planet, or growth in Fairtrade and organic bananas, I say jump in and “let good things grow”.  

The only downside being that the aforementioned delicious bananas, sampled in situ, are not yet available in the UK and Ireland…

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