Inclusive Growth through Inclusive Business: Engaging the Marginalized in the Core of Business

Aug 14, 2018

by

 

Northern Mindanao’s premier business organization has been quietly laying the ground works for the Inclusive Growth through Inclusive Businesses paradigm being championed by international economic development institutions such as the World Economic Forum, the Asian Development Bank and the World Bank.

 

Farmers of the Odino Clan-Higaonon Tribe raise corn & sweet potatoes thru slash & burn subsistence farming for their daily needs.

 

Since 2015, the Cagayan de Oro Chamber of Commerce and Industry Foundation, Inc. (Oro Chamber) has been promoting inclusive growth for the sustainable economic development of Cagayan de Oro City and her influence areas through its pilot project that over the next few years aims to create an independent Inclusive Agri-Business Development Center for Inclusive Business (IABDC4NM).

 

“We believe that engaging the marginalized in the core business of our businesses is a very good solution in our country’s development,” said Robertino E. Pizarro, Oro Chamber president. “It is the solution to include them in the country’s progress and development. Not only does it benefit the poor, it’s good business for business.”

 

The project simultaneously addresses prevalent poverty issues by carrying out IP Community agro-forestry projects in partnerships with High Value Commercial Crop Corporations (HVCCC).

 

Initially, the project dubbed received a USD 194,000 grant from the US Agency for International Development’s PhilippineAmerican Fund Economic Growth Grant as Program Support for the Chamber’s Promotion of ‘Inclusive Growth through Inclusive Business.’

Bobby Ansaldo presents Oro Chamber’s Inclusive Business program to USAID’s Melissa Kennison & Robert Barton with the Oro Chamber & USAID-SURGE Core Team last March 2017. (photo courtesy of Irene Floro)

 

 

Engaging the Base of the Pyramid

 

“This project will demonstrate the benefits of Inclusive Business by Engaging the Base of the Pyramid at the Core Business of Business through the supply of raw materials to meet industry needs, create livelihood opportunities for communities, effect poverty reduction and improve peace and order,” said Program Director Roberto W. Ansaldo, a former undersecretary at the Department of Agriculture and Oro Chamber vice president.

 

“Oro Chamber partners with private companies for technical assistance, quality planting materials, assured markets, and transparent pricing. Project benefits and best practices in inclusive growth will be communicated to a wider audience through an information campaign,” Ansaldo explained.

 

Datus of the Bukidnon-Taguluanen Tribe

 

The project identified the Bukidnon-Taguluanen Ancestral Domain near Malaybalay City, Bukidnon as a pilot area. The Taguluanen tribe who maintains a Certificate of Ancestral Domain Title (CADT) over the area was identified as the first group of project beneficiaries and currently grows cacao as their primary crop. 

 

“The word Taguluanen is derived from the fact that we are from the ulohan or headwaters,” said Atty. Burt Estrada (Datu Manhan-Ayan) of the Bukidnon-Taguluanen Tribe.

 

 “When the IPRA Law was enacted 20 years ago, my father (Tribal Chieftain Judge Ben Estrada (Ret.) whose native name is Lumalambong Datu Manlumakbaw) initiated the filing of an ancestral land claim over the area adjacent to the City of Malaybalay. The most important part of this claim is that area which is our sacred ground.”

 

After the group expressed their willingness to undertake a long-term financing package to develop their lands into high-value tree crop plantations, the project team initiated a series of community consultation activities with the CADT holders with 21 elders (38 percent women) actively participating.

 

“This could be an opportunity to help us develop that sacred ground and protect our culture,” Atty. Estrada said. “To give our people the means to meet their economic needs, and enable us to return to our indigenous culture and customs.”

 

Discussions focused on the project objectives, the role of the chamber and a discussion on Responsible Agricultural Investments led by Ansaldo. It concluded successfully as the Bukidnon-Taguluanen Tribal Council Elders formulated a resolution accepting the project as beneficiary and co-participant.

 

Meantime, the project team identified the second beneficiary – the Odino Clan – Higaonon Tribe of Brgy. Kibalabag, Malaybalay, Bukidnon whose 200-hectare ancestral domain is adjacent to the first community of beneficiaries.

 

The community members currently farm at a subsistence level, growing corn and sweet potato for food, since they lack the funds and access to improved technologies, markets and post-harvest equipment critical to their crop of choice.

 

The Clan confirmed their determination to develop their lands via the expansion and cultivation of an already existing high-value crop they are familiar with – Abaca.

 

Erson Odino, Datu Manimaan of the Odino Clan, stripping abaca fibers by hand.

 

Erson Odino, Datu Manimaan of the Odino Clan, and a resident of Barangay Kibalabag, related how they had to plant and harvest the abaca by hand, strip the fibers manually, and then walk from Bgy. Kibalabag to Malaybalay on foot since it was too expensive to take the habal-habal (motorcycle taxi). There being no regular buyers of abaca in Malabalay, they were not assured a good price for their product, or worse, forced to take a pittance for it.

 

Business partners, not mere landlords

 

After a series of Community Consultations with both communities, the Project Team conducted  Business Planning Workshops to Develop Business Plans for their respective Crops; General Assemblies for Information and dissemination to all tribal members; Community Profiling and Area Mapping; and Pre-Registration Seminars needed to form a Cooperative as the community’s economic arm and juridical entity.

 

Stripped abaca fiber has to be brought from Bgy. Kibalagag to Malaybalay by foot since it’s too expensive to take the habal-habal.

 

Notwithstanding specific goals for each of these activities, all had the common objective of empowering the Communities to access financing for funds needed to cultivate their areas; link them directly with Institutional Markets to ensure regular buyers and good prices for their products; and, access the latest growing technologies to increase yields, and post-harvest practices to improve the quality of their cacao beans and abaca fiber.

 

“What will be the effect of all these? The owner of the land becomes the cultivator of the crop,” Ansaldo noted.

 

The Cooperative Development Authority (CDA) subsequently registered both community coops, as the Bukidnon Tagoloanon Mulahay Ha Kabukalagan Agriculture Cooperative, and the Kibalabag Matanus Agriculture Cooperative last November 20, 2017.

 

The Oro Chamber project teaches members of the Odino Clan of the Higaonon tribe to be partners in business rather than landlords merely leasing out their lands.

 

In addition to the successful CDA Registrations, the Bukidnon Taguluanen Tribe also secured the En Banc approval and recognition of their Indigenous Political Structure (IPS) after 4 years  from the National Commission for Indigenous People (NCIP) Central Office, signifying the State’s recognition of their governance structure that would serve as the Tribe’s Political Arm.

 

By December 2017, the Bukidnon Taguluanen Tribe was able to submit their Loan Application for Cacao 100 Program to Land Bank of the Philippines; and draft a Marketing Agreement with Kennemer Food International as their Institutional Market.

 

Inclusive Business is Good Business

 

“Business entities which partner with small growers who produce the necessary commodities needed by the agri value chain means companies do not have to spend for machinery, supervision, land rentals, security, and all other expenses involved if they engage in leasing lands and farming themselves,” Ansaldo explained.

 

Since the Grower Cooperative absorbs the natural risks inherent to agricultural production, such as natural calamities, insect infestations, etc., Business is guarantees quality produce at the factory gates. Erratic free market price fluctuations are eliminated through previously negotiated pricing formulas, and land and tenurial problems diminish since the landowners are now the cultivators themselves.

 

Looking up to the future

 

“It takes so long for models like this to finally get off the ground because people simply didn’t believe it could happen,” noted Eugene Gonzales, Phil-Am Fund Chief of Party, during the MOA signing between the Bukidnon-Taguluanen Tribe and Kennemer Foods International held March 22, 2018 at the Manila Yacht Club, Roxas Blvd., Malate, Metro Manila.

 

MOA signing between the Bukidnon-Taguluanen Tribe and Kennemer Foods International held March 22, 2018 at the Manila Yacht Club, Roxas Blvd., Malate. Metro Manila. (L-R) Eugene Gonzales, Chief of Party, Phil-Am Fund; Atty Burt Estrada, Bukidnon-Taguluanen Tribe; DOF Asst. Sec. Edita Tan; and Managing Director Simmon Bakker, Kennemer Foods Int’l.

 

 “In less than two years of actual implementation, they got this model running, and hopefully continuing and scaling up in the next few months and hopefully continue on being sustained, and replicated in other areas,” he added.

 

“This innovative approach of inclusive business is aligned with the administration’s thrust to improve access to economic opportunities,” said Dept. of Finance. Asst. Sec. Edita Tan. “The Department has been very supportive of various efforts and initiatives that would enable the Philippine government to maximize and increase the country’s potentials in achieving the desired inclusive and sustainable growth.”

 

Now both communities are entering into the Enterprise stage. After successfully establishing their Juridical Entity as Cooperatives, they are now in a position to access financial resources from Government Financial Institutions like LBP or DBP to establish and cultivate their desired plantations.

 

“As we are closing this program now and the tribe is taking over already because they are going to run the plantation themselves, we’re not going to do that,” Ansaldo stressed. “We empowered them to be able to do that. As they build up and grow they will need help so we’ll be here to hold their hands as they move along their business journey.”

 

Following on the successful Proof of Concept with the first two Cooperatives, plans are underway to elevate the initiative from the initial program to an independent Inclusive Agri-Business Development Center for Northern Mindanao (IABDC4NM) which will have its own corporate charter to fulfill its mandate of Inclusive Growth through Inclusive Business.

 

-INDNJC-

Share this Post: