Business Partnerships for Global Goals COVID-19 Vulnerable Supply Chain Facility Business Partnerships as a Force for Good Learning Series
Business Partnerships as a Force for Good Listening and Learning: Using beneficiary feedback1 to drive better performance in agriculture and garments supply chains Learning Brief No. 10 By Mihaela Balan, Monitoring Evaluation and Learning Lead, BP4GG Key words: ESG, supply chains, impact performance, lean data, 60dB Business Partnerships for Global Goals (BP4GG) is a UK Aid funded programme implemented by Mott MacDonald, with support from Accenture Development Partnerships and IIED. We partner with UK and international retail brands, not-for-profit organisations, farms, and factories to provide economic, social, environmental, and health benefits to around 1 million vulnerable women and men impacted by COVID-19 in 7 countries across Africa and Asia.
This paper provides key insights on the impact performance model that the BP4GG programme put in place to manage impact of its over GBP4m investment in the VSCF COVID-19 Facility, and how could these insights be considered by brands and retailers, or donors for similar initiatives or in similar contexts.
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The COVID-19 outbreak in early 2020 has had an enormous impact on brands and retailers and their supply chains. It was an unprecedented global situation that affected us all. While brands and retailers were closing shops and were struggling to keep their businesses afloat, on the other end of the supply chain, workers were experiencing layoffs, reduced working hours with huge impact on their livelihoods. Immediate recovery was on everybody’s mind and action, but long-term survival, the interdependence of all supply chain actors and the mutual interest of maintaining relationship between brands/retailers and their suppliers was equally a priority.
VSCF at a glance • 8 projects • GBP 4.9m total projects cost [2.4m FCDO + 2.5m partners] • 12 months in duration • 2 sectors • 7 countries across two continents Africa and Asia • 20 retailers and brands involved • 296 suppliers • Over 1,000,000 beneficiaries reached
Mott MacDonald | BP4GG | Business Partnerships as a Force for Good Learning Series | Learning Brief No. 10.
To respond to COVID-19 impact on supply chains the Business Partnerships for Global Goals Vulnerable Supply Chain Facility (BP4GG VSCF) was established by the Foreign, Commonwealth and Development Office, UK (FCDO). Through this facility FCDO has partnered with UK and international brands/retailers and not-for-profit organisations to implement initiatives in the agriculture and garments sectors in Africa and Asia that would support recovery as well as improve longer term resilience of supply chains. As a COVID-19 rapid response facility implemented during unprecedented times, the VSCF put in place mechanisms to check if its efforts had an impact on those most in need. A clear focus on impact performance was built within the Facility, from its design phase, including reliable feedback loops to quickly signal underperformance. A ‘hybrid’ model to manage impact performance was used: not only VSCF partners had plans for thorough data collection at baseline and endline points, but the VSCF Facility Manager, complemented that with independent assessments, using LeanDataSM2 . The BP4GG Impact performance model was designed to respond to impact measurement requirements of FCDO, account for funds spent and show value for its investments. But it was also designed to bring useful lessons for our partners, not for profit, brands and retailers, who also wanted to manage for impact, and learn more about, improving the resilience of supply chains in the face of crises, such as a global pandemic. This approach brought in key insights for brands, retailers, not for profit or donors to consider for similar initiatives or in similar contexts.
1.The importance of ‘During’: why was it important to collect data frequently during the programme? In business, companies receive a prompt wake-up call when they are not responsive to customer preferences and choices: sales and profits, the universal measures of success, generally decline. In the development sector, however, we may not get timely notice if we ignore our beneficiaries and only check at the end of a programme. VSCF partners’ impact measurement plans included baseline and endline³ surveys to measure progress. However, while information from an endline study is useful for lesson learning, it often comes too late to be able to act and adapt a programme’s activities to be more effective. Therefore, the Facility Manager built in interim checks as a way to routinely listen to the most important constituents - ‘the beneficiaries’, and act quickly. The VSCF partnered with 60 Decibels (60dB), a tech-enabled impact measurement company, to gather data mid-way. These Rapid Validations [RVs] were planned not too early, but also not too late in order to allow time to respond to the survey findings, adapt initiatives accordingly and still see impact before the end of the Facility. The Facility Manager worked with partners to identify which aspects they would want to check, co-created surveys together, and used a non-intrusive, Interactive Voice Response (IVR) system to deliver them to beneficiaries’ phones. These were six or seven simple but critical questions, translated into the appropriate local language that could be answered at beneficiaries’ own pace and in their own time. Using this approach, nearly 1,500 beneficiaries across seven VSCF projects provided their feedback. Beneficiaries were asked whether they have been reached with project support, and if, because of that, they have changed how they do things; and what benefit, if any, in their working environment or/and livelihoods have they encountered. The survey response rate, which usually stands at 5% [based on 60dB previous studies] was 23%, and for some initiatives even higher. VSCF wanted to listen, but what this response rate shows is that beneficiaries also wanted to share their experience.
¹ VSCF uses the term ‘beneficiary’ to define workers, farmers, or community people which have been targeted by the Facility ² LeanDataSM uses remote, typically mobile phone-based data collection. ³ Endline is a study conducted after the end of that intervention. The results of the endline survey are measured against some comparative data – ideally the baseline survey.
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Mott MacDonald | BP4GG | Business Partnerships as a Force for Good Learning Series | Learning Brief No. 10.
The importance of During: We learnt that in the “during” stage, obtaining the perspectives of beneficiaries while they are receiving services is critical - and most often overlooked. When our projects are still under way, rapid feedback loops that solicit the beneficiary viewpoint helped us adapt quickly.
These RVs helped to… •
Test assumptions early enough: The RVs confirmed that COVID-19 had severely impacted farmers’ incomes in Ghana. 84% of cocoa farmers supported by Fairtrade and Mondelez reported that their ability to earn an income from cocoa has been affected in the last year. Payment delays, lockdown restrictions on transport, and the impossibility of accessing money were listed as top difficulties. Farmers are more vulnerable than before, with half reporting their livelihoods are less secure than six months ago. The intervention designed by partners to support farmers with alternative income generation activities and improve food nutrition, was therefore relevant, and needed. Further studies conducted by partners and Facility Manager showed that by the end of August 2021, 1,000 farmers had benefited, with over 12,500 expected to benefit by September 2021 and over 90,000 by March 2022.
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Test likelihood of impact early and scale up: The RVs confirmed the impact that the provision of food aid had on informal workers and their families in Bangladesh. 91% of informal workers said they felt worried about not having enough food since the pandemic started. RVs also showed that food aid delivered by the GoodWeave/Monsoon/VF Corp supported 4 more household members and the household had food lasting for at least 3 days. The respondents rated the usefulness of this support at 4.3 on a scale of 1-5 (where 1 is ‘not useful at all’ And 5 is ‘extremely useful’). Later in the BP4GG programme, when more funds became available to Bangladesh initiatives, VSCF worked with FCDO to channel these additional funds to this type of support. Overall, 11,500 workers and their families have been supported (double what was originally planned) and 346,000 person days food provided through food aid.
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&Wider conducts due diligence and monitoring of working conditions using worker engagement technologies Photo credit: Nairobi Business Monthly
Take decision and change course: Context is important RVs studies showed. Though the same approach to disseminate information on COVID-19 risks was used across multiple countries, farm workers in Kenya were more likely to find COVID-19 risk training useful, while farm workers in Zimbabwe were more likely to find workplace posters on COVID-19 risks useful. Understanding the reasons behind these differences helped the ETI-led project, supporting East African horticultural supply chains, to select the most appropriate channels for future information dissemination to ensure interventions reached target groups in the right/most appropriate and needed modality.
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Mott MacDonald | BP4GG | Business Partnerships as a Force for Good Learning Series | Learning Brief No. 10.
2. The importance of ‘Listening’: the core of our Impact performance model The views and experiences of the people who benefit from socio-economic programmes are often overlooked and underappreciated, even though they are an invaluable source of insight into a programme’s effectiveness. This was an area VSCF wanted to improve on. Beneficiary feedback studies subcontracted to 60 Decibels were designed to include in depth insights of impact by talking to beneficiaries and suppliers and taking different perspectives. The mid-way RVs were followed by comprehensive sector-level impact studies at the end of the funding period, where 60dB used telephone interviews to speak with both beneficiaries and suppliers. Through these studies, voices of nearly 800 workers, a representative sample across projects have been heard. In addition, we listened to 89 managers, selected across VSCF’s 139 (of the 296) suppliers. Both studies were conducted using telephone interviews. The findings, which will be part of the BP4GG Impact Report⁴, are encouraging: the Facility has impacted positively on the vulnerable supply chain workers: most of whom report that they now have a sense of safety and security at work, their ability to cope with the pandemic has increased and they now have more confidence to earn an income. They were confirmed during suppliers’ interviews: all managers interviewed feel support was important to help their workers deal with the pandemic. All are now feeling more positive about their factory/farm as they implemented changes to make the workplace safer for vulnerable workers or producers. The likelihood of sustainability of results is also high: all of them mentioned it was very likely they would continue implementing changes introduced by VSCF beyond this programme. Many of them also feel their relationships with the brands or retailers has improved. Now, depending on their ‘impact’ intentions, retailers & brands can use these insights to increase the positive impact on their supply chains and minimise the negatives/risks that these studies identified, and hence manage and maximise impact beyond.
Impact insights Suppliers’ voices Because of the VSCF support & compared to when the project started… • For 98% of suppliers the way they run their business has very much improved or improved. • 100% have seen a significant positive or some positive on their effort to recover from the pandemic. • For 100% of them is very likely of somewhat likely to continue implementing these changes. • 100% are feeling more positive now about their factory/farm. • 63% very much improved relationship with retailers/brands, 19% slightly improved. Workers’ voices: • 63% of B4GG beneficiaries are living on below $5.5 a day, 38% below $3.2, 13% below $1.9 [poverty] Because of the VSCF support & compared to when the project started… • 92% report their sense of safety & security at work very much improved or improved; 8% do not feel the same way. • 86% saw their ability to cope with the pandemic very much improved or improved; only 14% have not. • 64% have very much improved or improved their confidence in earning an income. 29% see no change; 7% are still struggling. • 67% are still concerned about COVID-19, however • For 61% of them their level of concerned has very much decreased or decreased when compared to when project started. ⁴ Impact Report will be published by BP4GG in November
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Mott MacDonald | BP4GG | Business Partnerships as a Force for Good Learning Series | Learning Brief No. 10.
3. ‘Impact proposition:’ a possible path to more visibility in brands and retailers supply chains
What have we heard by listening? [brands/retailers voices]
Supply chain transparency requires companies to know what is happening downstream in the supply chain (gain visibility) and to communicate this knowledge both internally and externally (disclose information).
Julie Taylor, Ethical Compliance Officer, Mi Hub “We (Mi Hub) do have boots on the ground in Bangladesh for physical support to factories, which helps them to keep up monitoring and following up on standards.”
One reason this has become increasingly important is that more consumers are demanding responsibly produced products including reassurance about the conditions under which they are produced. For instance, researchers at the MIT Sloan School of Management found that consumers may be willing to pay 2% to 10% more for products from companies that provide greater supply chain transparency.
Cathy Pieters, Senior Director Sustainable Ingredients & Cocoa Life, Mondelēz International: “We were working towards a sustainable solution in this project, a capability that can be built, leaving something behind. Not only putting a band aid. We are working on Cocoa life 2 strategy for the next 10 years. We will continue the holistic integrated approach from this project that is tackling the root causes. We will always be looking at sustainability and system change.”
In this study⁵ consumers valued information about the treatment of workers in a product supply chain and the seller’s efforts to improve working conditions. Across industries, this growing segment of discerning consumers seeks information on product ingredients and materials, where products come from, and the conditions in which they were produced. They increasingly want to know more about where, how and by whom the products they purchase are being made, which pushes companies to look for impact that goes beyond Environmental, Social and Governance [ESG] which, is already an inextricable part of how retailers do business. Other stakeholders, e.g., government, shareholders, NGOs, also want to understand the processes through which companies meet their responsible sourcing commitments.
What have we heard by listening? [suppliers/managers voices]
Recovery from COVID-19 “I feel more safer now. Due to the training, workers are more concerned about their health. They tend to follow the rules more and wear the mask all the time.” Manager, M&S factory
By listening to workers, farmers and suppliers, the VSCF’s Impact performance model, gives brands greater visibility into their supply chain. With impact insights at hand, retailers may now choose those impacts that matter to them and to the people in those chains and continue to manage & maximise these impacts. They may decide to do that by embracing LeanDataSM as a business intelligence tool to more effectively identify risks in their supply chain operations. They can also use these impact insights to feed consumers’ increased interest for more visibility of responsible sourcing. Ultimately, more visibility may safeguard a company’s long-term success.
Operational changes “Due to this support, we changed the way we operate…we made arrangements to wash hand before entering factory, we check body temperature of the workers, and always instruct them to wear masks. Also, we have a doctor present in the factory.” Manager, factory, Bangladesh “We have reduced our meeting times and developed effective ways engaging the farmers with the intention of preventing the spread of the Covid-19” Union leader, FT Cocoa
⁵ Supply Chain Visibility and Social Responsibility: Investigating Consumers’ Behaviours and Motives, https://pubsonline.informs.org/doi/10.1287/msom.2017.0685
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Mott MacDonald | BP4GG | Business Partnerships as a Force for Good Learning Series | Learning Brief No. 10.
Conclusion: Beyond ESG, the Impact model unpacked
What have we heard by listening? [workers voices]
Going forward, consumers and investors are poised to query more about how ‘what they buy or invest in’ aligns with their values about fairness, the environment and human rights. In the face of rising economic inequality and mounting evidence of the negative externalities of business practices, businesses are under pressure to demonstrate that they deliver value responsibly in ways that work for people and communities around the world. Riding the coattails of the pandemic, society expects more from businesses on how they will contribute to greater good. Social impacts are now considered important by 92% of investors, compared to 39% before the crisis. 70% consider social criteria (the S in ESG) as ‘extremely important’, which is an increase of 20 points since the start of the pandemic⁶.
What actions are giving them hope “At work AA growers have done the most during this pandemic and am grateful.” Female worker, vegetable farm, Kenya “Temperature checks every morning at work and fellow employees being able to put in practice what we are being taught is giving me hope.” Male worker, flower farm, Kenya “I feel safe in the factory and in the area where I live because everyone is more concerned about COVID. I see hope ion it.” Male worker, garment factory, Bangladesh “No one giving us hope right now.” Male worker, garment factory, Bangladesh
However, the social pillar of ESG remains the most difficult to integrate: 51% of institutional investors still rate social factors as the most challenging, partly due to a lack of the right data. Often the ESG analysis focusses on a company’s efforts, policies or procedures instead of their impacts and the real effects these efforts should produce. Only 8% of the “Social” (in ESG) indicators assess the effects of businesses’ “Social” practices, while the vast majority (92%) assess the businesses’ efforts and activities, a NYU research found out⁸.
“During the lockdown most of the garments companies are shutting down. But my company is paying us full salary. So, I am happy.” Male worker, garment factory, Bangladesh
To create transparency requires a company to both gain visibility into its supply chain and disclose information to consumers.
“We manage what we measure, adjusting based on feedback and learning loops enabled by real data”⁹. By listening to workers, farmers and suppliers, the VSCF’s Impact performance model, offered a way to capture the effects the VSCF operational support has had on people it touched. Not cumbersome and expensive, but simple and valuable, and grounded in perhaps the most uncomplicated activity, listening to beneficiaries. If impact matters to programmes, retailers or brands, then aspirations must always be to hear directly from workers, farmers, managers, how they feel, what is important to them, and ultimately, if a difference was made.
David Alder, MWW, mentioned VSCF has come at a time where they could not travel, they could not have achievements like this before; “through VSCF we have gained benefits both through the direct actions that took place in on the ground but also the subsequent measurement and feedback work that has highlighted the projects impact”
By prioritising impact over processes, and focussing more attention on beneficiaries’ experiences, brands and retailers can drive value along a more transparent supply chain. Impact can sit alongside strategy and operations to drive overall business performance to safeguard a company’s long-term success. ⁶ https://mediaroom-en.bnpparibas-am.com/news/bnp-paribas-asset-management-survey-shows-covid-19-prompts-rise-in-social-considerations-within-investmentdecision-making-8e57-0fb7a.html ⁷ BNP AM April-May 2021 study, was based on data collected from 356 institutional investors with an estimated USD 11.3 trillion in assets under management [https://securities.cib.bnpparibas/bnp-paribas-survey-shows-esg-integration-is-maturing-and-institutional-investors-are-at-different-stages-of-readiness-for-net-zero/] ⁸ https://www.stern.nyu.edu/experience-stern/global/putting-s-esg-measuring-human-rights-performance-investors ⁹ https://60decibels.com/user/pages/07.Work/_measure_better/60_Decibels_A_Simpler_Way_To_Measure_Impact.pdf
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Garment factory worker at food relief distribution in Bangladesh Photo credit: Magnifier Creatives
Key takeaways • • • •
An Impact performance model based on listening directly from beneficiaries and suppliers can prove where an initiative has made a difference to those that matter most, but equally where more work is still needed. Using beneficiary feedback to collect data mid-way is critical for adaptive management, taking decisions, allocating funds and improving interventions, to move investments closer to making an impact. The VSCF-like impact model can make the “S” from ESG more visible by unearthing the effects investments in, e.g., safer and more secure workplaces, have had on workers, producers or supply chains at large. By focussing attention on beneficiaries’ experiences and impact, brands and retailers could feed consumers’ increased interest for more visibility of responsible sourcing, and, as more consumers are willing to pay more for products from companies that provide greater supply chain transparency, drive value along a more transparent supply chain. 7
Pakistan
Bangladesh
Ghana
Myanmar
Ethiopia Kenya Tanzania
Zimbabwe
VSCF countries
Business Partnerships as a Force for Good Learning Series VSCF Vision “To enable vulnerable people and supply chains to recover from and remain resilient to the economic and social impacts of COVID-19, by leveraging the reach and influence of responsible businesses through partnerships.” VSCF Mission “To enable recovery and resilience from the COVID-19 pandemic by forming strategic partnerships with global businesses. Working within supply chains in Africa and Asia, we will test and scale approaches to provide additional health and safety support, increase incomes, safeguard jobs, and ensure continuing access to markets. We will support vulnerable people within supply chains to recover from COVID-19, and support responsible businesses to build on these experiences to become more sustainable.”
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