Business Alliance Forum Report. Accelerating GAIN.

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Business Alliance Forum Report. Accelerating GAIN.
GAIN Business Alliance Global Forum
ACCELERATING GAIN
2 7
GAIN
Business Alliance
Members:
M A Y
2 0 0 9 ,
A M S T E R D A M
More than 170 business leaders and representatives of government, civil
society, academia and international agencies met in Amsterdam to discuss
how to accelerate the implementation of global nutrition programs for low
income consumers. The Forum launched the Amsterdam Initiative on Malnutrition (AIM) and announced the winner of the 2008 GAIN Business
Award for Innovation in Nutrition. John Defterios, entrepreneur and awardwinning broadcaster, moderated the Forum.
Highlights from the event included:
F O R U M
R E P O R T
John Defterios,
Event Moderator
Address from, Bert Koenders, Minister for Development Cooperation, Government of the Netherlands addressed the Forum in support of the AIM launch.
Keynote speech delivered by David Nabarro, Coordinator of the UN Secretary-General’s High Level
Task Force on the Food Security Crisis.
Two high level panels discussions focused on accelerating actions and investment to fight malnutrition.
Interactive Live Think Tank sessions proved an exciting innovation which used online technology to
involve every participant in generating ideas and recommendations in real time.
Opening Session
GAIN Executive Director, Marc Van
Ameringen, opened his commentary by
noting that the scale and underlying
causes of the nutrition crisis are clear,
and so too
are
the
means to
address it.
The Copenhagen
Consensus
economists are
confident
Marc Van Ameringen, GAIN
that
an
investment in nutrition is the most effective intervention, and will deliver the
largest development returns. However,
nutrition is still an under addressed issue
that can only continue to worsen if our
course of action is not altered.
A radical change in approach based on 10
key drivers was shared with Forum participants, and provided the context for
the day’s discussions:
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2
Launch of the Amsterdam Initiative on Malnutrition (AIM)
The Forum launched the Amsterdam Initiative on Malnutrition
(AIM), a public-private partnership led by the Government of
the Netherlands, business, and
academia. AIM will support national programs to improve the
nutrition of 100 million most
vulnerable people in Africa over
the next five years. Each AIM
partner took an opportunity to
explain their motivation for joining the Alliance at this launch
event.
Nutrition, food security and
“
public health are closely linked;
for a small investment in
nutrition now, we can protect
millions of lives and save huge
sums later in tackling poor
health. The poorest of poor
have little purchasing power –
the key is a comprehensive
approach involving public and
private sectors; without serious
investment the problem won’t
be solved.”
Jay Naidoo,
Minister Koenders opened
the session by explaining why
the issue of malnutrition and
the launch of AIM were so
important to the Netherlands.
He acknowledged that the first
1000 days of a child’s life are
critical to lifelong development
The Minister emphasised the
accountability of different
stakeholders including developing countries themselves,
the international community
has and the private sector. He
argued that Public Private Partnerships (PPPs) which bring
these actors together, are the
key to change and AIM is an
excellent alliance, with reputable companies and universities
involved, that has been de-
signed to develop a successful
model that can be replicated
elsewhere.
achieve maximum impact.
Doug Baillie, President of
Unilever Western Europe,
spoke of the imperative to
invest in the future and the
importance to his company of
a healthy consumer base.
When a problem is this significant, multiple stakeholders
need to work together to
Professor Frans Kok, University of Wageningen,
observed that there is ample
data to indicate the positive
impact achieved by private
business, academia and governments working together. Key
priorities are to promote locally produced and fortified
foods, support dietary diversification, and build local capacity.
This position on the value of
cooperation over competition
Jay Naidoo, Chairman of
within the private sector was
GAIN and Chairman, Deendorsed by Mauricio
velopment
A d a d e ,
Bank
of
President
Southern
Human NuA f r i c a
trition, DSM.
(DBSA) arDSM
has
gued that Govproven
that
ernments must
collaboration
be held accan
succeed
countable for
through
its
the loss of
work
with
Minister Koenders
children’s lives.
WFP
and
Africa faces a triple epidemic
other private sector compaof HIV/AIDS, TB and malaria,
nies to improve the food basand underpinning all of these
ket in Africa. Rob Frohn,
health issues is the problem of
Member of the Board,
poor nutrition. The AIM partAkzoNobel, agreed that
nership is designed to address
companies can not go it alone
nutrition issues related to
and PPPs are critical to create
these diseases and help poorer
appropriate legal environments
consumers access high quality,
and secure cost effective
affordable food.
strategies.
Chair, GAIN Board
AIM will focus on delivery and
best practice, with emphasis on
local execution. Products will be
The AIM tailored to consumer needs with
Panelists the goal of improving the nutritional quality of local diets.
GAIN
BUSINESS
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GLOBAL
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GAIN
BUSINESS
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3
Panel on Accelerating Improved Nutrition at the Base of the Pyramid (BOP)
This session focused on how to reach the
2 billion people living on less than $2 day
with more nutritious foods.
Professor Prabhu Kandachar, University of Delft: The four billion
poorest people have $5 trillion purchasing power and the largest part of
this is in the food sector. The dynamics
and demographics at the BOP are
changing, and, as countries such as
India keep growing, the pyramid
morphs into a diamond shape with
increasing purchasing power in the
middle. A global balancing act is required to address economic and environmental sustainability.
Hardin Tibbs, Futures Research
and Strategic Consultant: Absolute
food production is still increasing but
per capita levels are falling due to
population growth, and real prices.
While the immediate crisis is over, real
prices remain 40 percent above their
2003 low. The question is: are we
reaching limits of production increases
under current model; was this just a
price hike, or have we reached peak
food production under the current
system? Across the world, responses
to change will be conditioned by uncertainties surrounding the availability of
sufficient energy, water, land and skills.
We need innovation to address these
challenges and develop not just for yield
but for quality.
BOP Panelists
Two successful business models in
fighting malnutrition were presented which originated at the
BOP.
Belete Beyene is CEO of Hilina
Enriched Foods in Ethiopia, a company which produces supplements for
children aged six months to five years
which are suited to local consumption,
and respectful of local customs. Hilina
produces a Ready-To-Use Therapeutic
Food (RUTF), as a franchisee to Nu-
triset, to treat acute malnutrition.
Beyene shared the components of his
business model for success: planning,
adaptability, use of local raw materials
and simple technology, financial partnerships with low interest loans, 3rd party
accreditation, and good labelling.
Syed Kaiser Kabir is CEO of Renata
Ltd, in Bangladesh, a company which
has pioneered the production of Sprinkles – a single serving sachet of multimicronutrient powder that is mixed with
complementary food to address the
issue of paediatric anaemia. The aim is to
reach 2 million children. Kabir shared
components of his business model for
success: creating the market is a long
term effort requiring awareness and low
prices to reach the BOP. Renata uses its
network of medical professionals and
works with a national NGO, BRAC, to
promote the product. To help create
new markets, promotion is needed and
this is where government, GAIN, and
NGOs can become involved. Once the
market is established other producers
can join and the pump priming funds
won’t be needed.
2008 GAIN Business Award for Innovation in Nutrition
Established in 2008, the GAIN Business Award for Innovation in Nutrition was created by GAIN and the International Business Leaders Forum (IBLF) to recognize a company displaying outstanding innovation in the development of new products and services to fight malnutrition,
improve public health and promote sustainable development. The 2008 Award received over 30 entries from all
over the world.
The 2008 runners up were Valid International for
its Community-based Therapeutic Care (CTC) combined with the production of a range of Ready to Use
Foods; and Shijiazhuang Zhenji Brew Group Co.
Ltd, a Chinese company which has successfully marketed iron-fortified soy sauce to vulnerable rural
populations in China.
The 2008 GAIN Business Award was presented to
DSM Nutritional Products Ltd (DSM) for its
innovative fortified rice product, NutriRice®. Developed in cooperation with Bühler AG, DSM has
pioneered a new technology that produces rice
kernels that are indistinguishable from unfortified
rice in look and taste. DSM's work to develop a
process which has made a fortified rice product
acceptable across low income communities is a
significant nutritional product innovation.
The Award was received by Mauricio Adade and
presented by Marc Van Ameringen, Adam Leach,
CEO, IBLF (International Business Leaders Forum),
and Will Oulton, Director, Responsible Investments, FTSE and member of the Awards Judging
Panel.
Marc Van Ameringen
presenting Award to
Mauricio Adade of DSM
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Panel on Accelerating Improved Nutrition through Innovative Financing Mechanisms
This session explored how the GAIN Innovative Finance Program (IFP) might tap into capital markets and venture philanthropy to attract new assets to the nutrition theme and
contribute to meeting GAIN’s objectives. The panel addressed this issue from experience of six very different organizations.
Omer Imtiazuddin, Health Portfolio Manager at
Acumen Fund in New York described how the Acumen model is different from traditional financing for
social ventures. Acumen does seek a
return on investment to recycle into
their funds, and currently manages
the GAIN Acumen Portfolio (GAP).
Imtiazuddin explained, for example,
how Acumen blends a user-fee system to lower expected return on
investment. The challenge is to generate investment in countries in which
markets are not well structured.
returns – what are seen as “impact investments” where
returns are self sustaining over 5 years, and different
from grants, loan and equity options. Nutrition is seen in
an integrated way linked to food security, environmental
quality, water supply etc. Oliver noted that GAIN may
replicate successful models, help local entrepreneurs,
and contextualise business models locally in high-risk
countries in Africa or Asia.
Dirk Elsen, Chairman SNV Netherlands Development Organisation in Amsterdam, shared that SNV does not have
its own capital to invest, but provides
critical advisory services to maximize
the opportunities for success on the
ground. Elsen explained how innovative financing may often be remarkably simple. For example, a venture
fund for small holder farmers in subSaharan Africa for small deal flows in
the US$ 100k to 200k range which
Innovative Financing Mechanisms Panel
fills the need for crop storage.
Oscar Chemerinsky, Director for
Global Agribusiness, International Finance Corporation (IFC)
in Washington D.C stated that in 6 years the IFC has
tripled investment in the food sector, with about US$
1.4 bn in projects at the end of 2008 and the expectation that this will grow. The majority of projects need
standard financing mechanisms. IFC does see nutrition
as an investment area and is collaborating with GAIN on
the creation of an IFC/GAIN co-investment in a fund
supporting projects which address nutrition at BOP,
with the first opportunity being reviewed in Latin America.
Oliver Karius, Partner, LGT Venture Philanthropy at LGT Bank Ltd in Zurich is applying financial, intellectual and social capital to projects. The aim is
to develop the space between purely social and financial
Giuseppe van der Helm, Executive Director, VBDO in Amsterdam stated that
integration of sustainability in capital markets will benefit
from breaking down the tendency of NGOs to see private sector involvement as “green washing”, and of investors seeing it as just another (unnecessary) cost.
Both large companies and investors are now more interested in wider impact and a new market for companies with long-term horizons.
Finally, Will Oulton, Director Responsible Investments, FTSE in London commented that GAIN is a
powerful convenor of intellectual capital and is in a position to incentivise innovation: investors like to invest in
companies that are leaders and outperform their peers.
The Live Think Tanks
In a series of cutting-edge interactive sessions, participants
shared their knowledge and experience through small
roundtable discussions. Participant feedback was synthesized in real time and used to generate and validate recommendations for the acceleration of the nutrition agenda. A
series of questions within 2 broader topics were explored
by participants: 1) how to accelerate action related to
malnutrition 2) how to increase investment in malnutrition. A working paper containing a full analysis of the results of the Live Think Tank sessions will be available to
participants shortly.
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Key Note Speech — David Nabarro, Coordinator of the UN Secretary-General’s High Level Task
Force on the Food Security Crisis
The keynote address presented an
analysis of 2008 food crisis and recommended actions to improve food
and nutrition security.
David Nabarro started his address
by providing participants with a
overview of the facts surrounding
the recent food crisis:
Rises in global food prices were a wake-up
call that the world’s food systems are in extreme crisis.
During the last two decades there has been a
systematic underinvestment in agriculture and
food systems in many developing countries.
The global economic recession is exacerbating hunger through unemployment, lower
investment and economic growth.
Last year’s price increases were due to underlying structural issues (increasing demand
for food, population increase, the structure of
the food market - biofuels, investment, protectionist policies which have inhibited investment in agriculture).
Recent price moderation does not signal
stability, and 15 to 30 percent of people face
food problems, an unacceptable percentage
by UN standards.
To provide more context, Nabarro moved on to
discuss the current agricultural realities in the
world today:
The world mounted the biggest ever concerted emergency feeding operation in 2008
and fed more than 200 million people in need,
heading off famine. But this level of emergency response is hard to maintain. We need
a comprehensive approach to improve pro-
ductivity and tackle the systemic problems.
Some 500 million small farmers are working
farms less than two hectares. This means that
over 2.5 billion people are dependent on
smallholder farming for their livelihoods.
They are key to the growth of fifty countries,
especially in Africa, and their productivity is
one eighth the global standard.
He closed his comments by suggesting the following means to achieving a change:
“There are opportunities
for businesses to make a
real impact in ways that
also contribute to their
markets and profitability. I
Address the needs of small farmers, especially
women, and improve availability of credit,
seeds, pesticides, vets, equipment and know
how. Such programs were dismantled during
last decades by governments.
am referring to both local
Improve access to markets by the poor,
change the food trading system which is unfair to small producers and a disincentive to
investment.
that this all starts from
Governments need to be part of bigger effort. Partnerships for action can expand local
production and market capacity.
shared belief, common
The engine for change is entrepreneurship
and innovation. For example, the WFP can
purchase locally not just staples but also
other products (Purchase for Progress program).
Sustain political support and finance, creating
“multi accountability”.
Focus on partnerships that lead to action,
smart partnerships which keep transaction
costs low - focus on alignment of institutions
and not the creation of new structures.
Networking at the BA Member Lounges
(national) businesses and
those that operate transnationally. And I stress
the building of
partnerships based on a
purpose, respect, trust
and a commitment to
working in synergy. None
of these attributes occur
just like that – they need
to be worked at, and they
require investment and
commitment from special
people. People like you”.
David Nabarro
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Concluding Session
Paulus Verschuren, Chair, GAIN Business Alliance (GAIN BA) closed the
meeting with some concluding remarks based on his observations and interaction
with participants throughout the day:
There is enormous intellectual power and practical experience in the room. All
the necessary actors needed to accelerate the nutrition agenda are present..
Partnerships are crucial but the engine for change comes from entrepreneurs.
The collective private sector voice spoke out to say that the advantages to collaboration with other private sector actors outweighed any of the perceived
disadvantages.
The individual pieces of the puzzle are available, the challenge will be how we
put the pieces together to accelerate the nutrition agenda.
Advocacy efforts are improved when impact can be measured. Delivering impact will encourage new and larger
investments.
Cultural and local buy-in is critical to make BOP models work.
The GAIN Business Award for Innovation in Nutrition shows there is more research and innovation than we
were aware of. The private sector can drive innovation to create sustainable solutions.
GAIN’s role is in facilitating and bringing together the moving pieces of the nutrition landscape including advocacy, funding, and technical expertise. GAIN has convening power.
GAIN can be a marketplace for investors where they can explore creative ideas like the creation of a nutrition
bond or new ways to benchmark performance through corporate reporting.
Accelerating Towards Paris
Join the GAIN Business Alliance today!
The next GAIN Business Alliance Global Forum
will take place in May 2010 in Paris, France.
We hope to see you there!
If your company is interested in making a commitment to the fight against malnutrition, the GAIN
Business Alliance can be a means to access the information, networks, and best practices to help
accelerate your contribution and impact. For more
information about how to join the GAIN Business
Alliance,
please
contact
Kirstin
Wulczyn
at
[email protected] or +41 22 749 1848 to
receive our membership application form and hear
more about our new membership package.
The Forum Organising Team, Left to right:
Fred Tissandier, Steve Godfrey, Craig Courtney, Philippe Guinot, Graham Sinclair, Marc
Van Ameringen, Bérangère Magarinos, Kirstin
Wulczyn, John Defterios, Ayan Humbert-Droz,
Marina Monzeglio, Nicole Voillat
Rue de Vermont, 37-39
1202, Geneva
Switzerland
6

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