SAP and PlaNet Finance Hit Critical Milestones for Social Sustainability in Ghana Shea Value Chain Initiative
Stanford University Case Study Uncovers Significant Progress, Including Production of Higher Quality Nuts and Butter; Olam International Commits to Purchasing Nuts, SAP® Software Enables Socially Sustainable Value Chains
Using education, microfinance and information technology, SAP and PlaNet Finance joined forces last year to help improve the incomes and living conditions for rural Ghanaian women engaged in the shea nut harvesting and shea butter business. Results from a recent Stanford University case study that monitored program performance to date found that many of the program targets set for this year have been met. Additionally, the shea nut program has been bolstered by the participation of Olam International, a global supply chain leader of agricultural products and food ingredients that picked up the first batch of nuts in November. Under terms of an agreement, Olam will become a major buyer of the shea nuts in Ghana to meet its mandate of sourcing high-quality and sustainably sourced foods.
"There is an increased demand in the global markets for reliably high-quality products and, at the same time, a request for traceability along the entire supply chain," said Mritunjay Das, manager, Nuts, Olam Ghana. "We have begun picking up the first nuts directly from the women, and are very pleased that we can achieve both market requirements through this initiative."
The Stanford University case study, titled "The Shea Value Chain Reinforcement Initiative, by SAP, PlaNet Finance, Grameen Ghana and Maata-N-Tudu" found that the program successfully organized 1,500 women — the first half of the 3,000 targeted — into groups and a registered network, and then trained them on business skills, quality shea nut and butter processing. The case study also unveiled an increase of the women's income through their shea nut activities between 59 percent and 82 percent. Perhaps most important, "intermediate outcomes," extending beyond near-term goals mentioned above, include:
• Production of significantly improved quality of nuts and butter
• A stronger sense of belonging to a unit, with the ability to serve the market effectively
• Utilization of group savings accounts, which have helped the women pay for one-time expenses such as weddings, funerals and other events
• Learning business management practices that can be applied to other income-generating activities, such as farming
Microfinancing has proven to be an effective tool to break out of extreme poverty. Maata-N-Tudu and Grameen Ghana are microfinance institutions that serve as local partners to facilitate key program activities in the field.
"Together we have identified microloan products that will allow the women to build up sustainable business models using best-practices and equipment," explained Ivana Damjanov, deputy director of Operations at PlaNet Finance.
SAP has contributed with its core expertise to support the shea nut program. "Rural market connection" is a software package used to manage and process orders and allow buyers to interact directly with rural women while creating increased traceability and transparency along the value chain. The software is in use by the partner microfinance institutions. Additionally, the women will receive information from the system directly to their cell phones via SMS. "Microloan management" is a software package developed after PlaNet Finance indentified a need for microfinance organizations to have more timely information about their loan portfolios. The software has been installed in partner microfinance institutions and is being piloted by rural loan officers with promising results.
SAP has also developed www.starshea.com for the Star Shea network, the newly created national organization of women who participate in the program, so that buyers can now view products and get in touch with the network online.
"SAP's purpose is to make the world run better — this requires not only technology innovation but also social innovation," said Peter Graf, chief sustainability officer and executive vice president of Sustainability Solutions, SAP AG. "The positive results from the Stanford University case study underscore the power of education, microfinance and IT to create economic opportunities for the underserved. We are committed to the sustainability of this program to help ensure long-lasting improvements in the lives of the participating women of Ghana.".