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INNOVATIVE TYPES OF MEMBER-BASED ORGANIZATIONS:
WHAT DIFFERENCE DO THEY MAKE FOR WOMEN?
Lessons and questions from Indian cases
Alison Mathie and Yogesh Ghore
Coady International Institute
The Coady International Institute,Antigonish, Nova Scotia, Canada
Roots: The Antigonish Movement of the 1930s Promotion of member-based
organizations: cooperatives and credit unions
Accompanied by adult education
Since 1959: Education for Leadership and Action for development professionals from all over the world
Coady Institute, January 2012
Innovative types of member-based organizations:What difference do they make for women?
Coady Institute’s study of innovative types of MBOs
Relevance to Oxfam GB’s work on women’s collectives
General observations from MBO study Case examples from India:
Producer Companies RUDI Multi-trading SHG-Bank Linkage model
Innovation AND social inclusion? The role of intermediaries
Coady Institute, January 2012
Background trends
Shrinking of public sector and expansion of private sector influence
Privatizing previous responsibilities of the State Shift to “private sector” for-profit service
enterprises Shift to non-profit sector Shift to unpaid and voluntary sectors
Social innovation in the “hybrid” areas of overlap between state, private and civil society sectors
Trends
Private Sector
State
Civil Society
Hybrid Organizationse.g., producer company
Then Now
MBO study questions (as they apply to women’s collectives)
What innovative linkages are there between MBOs and private sector? And between informal and formal sectors?
Why are these new relationships or hybrid organisations emerging?
So what? Are women in communities taking more control
over their livelihoods? Are these new entities or linkages more effective
as a vehicle for women’s access to resources? Are these social innovations inclusive or are
intermediaries required to guarantee inclusion?
Coady Institute, January 2012
Oxfam GB’s Conceptual Framework
What we are seeing…
Innovative hybrids: MBO + private sector:
Producer companies, India SHG-Bank Linkage, India RUDI Multi-trading company
Informal-formal SHG-Bank linkages
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Case Study 1: Masuta Producer Company, India. Hybrid: A Unique Ownership Structure (MBO+ Private company)
Owned by over 3000 women yarn producers Operations spread across 120 villages in three states
(Jharkhand, Bihar, Chhatisgarh) Turnover of $ 2.12 million and profit of $ 71,000 in 2009-
10* Largest Tasar yarn producers organization in India and a
major player in the market New Act provides legal framework and still maintains the
unique spirit of cooperatives
Coady Institute, January 2012* Beyond Profit, 2010
Producer Company: HybridStructures evolve with changing objectives and functions
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Structure Function
Joint Venture Company Private Limited Co
Value addition and marketing
Producer Company
(National Collective)
Aggregation, Marketing and bulk purchase of inputs for the MBTs
Mutual Benefit Trust (MBT): First tier Producer Organization (20-30 primary producers)
Production, Quality control and sales
Self-help Groups (Informal affinity groups)
Saving and Credit
Producer Company Model Why the innovation?
Opportunities offered by economic growth/liberalization Weaknesses in the cooperative model Need for combination of different institutional models
So What? Increased incomes for the producers (mostly indigenous women ) Creation of an integrated process leveraging complementarities
among the SHGs, MBTs and producer Co Creation of a system that is accountable and inclusive
Success factors Focus on local livelihoods opportunities Time and investments in technology development, productivity
enhancement and community mobilization Integration of different structures and larger role for women in
management and decision making Affordable and timely services, efficiency, transparency, honesty,
and integrity in day to day functioning of the organization
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Any Question for Clarification?
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Case-Study 2
Rudi Multi Trading Company What is the innovation
A distribution network that links small producers to consumers, utilizing existing SEWA network (SHG and SEWA Institutions such as for microfinance and insurance, training, and communication facilities like SEWA radio station)
Complex mix of different institutions: SEWA as an MBO; district level associations; private sector partners, SEWA Gram Mahila Haat (SGMH), an apex marketing organization; Government funded programs etc.
Coady Institute, January 2012
Outreach: 2,65,000 small and marginal farmers
Workers: 1500 RUDIbens (Rural procurement and sales managers)
Turnover: $1.5 M Source: Changemakers.com
Rudi Multi Trading Company: The Model
Source: One world foundation
Rudi Multi Trading Company
Why the innovation? 65% of SEWA members work in the agriculture sector and many do not
have adequate bargaining power, market access, and storage/processing capacities and are subjected to exploitation by intermediaries
SEWA’s response using Gandhian principles of a self sustaining local economy by linking producers to consumers
A space for the for-profit entity to function within the MBO (SEWA) So What?
Direct market access to small and marginal farmers thereby increasing their incomes
Multiple employment opportunities for women members Access to high quality daily consumer products at affordable prices to
rural consumers Capital rotates within the region thereby strengthening the local economy
Success factors Grassroots foundations and internal cohesiveness Service provision and external linkages
Coady Institute, January 2012
Any Question for Clarification?
Coady Institute, January 201
CASE-STUDY 3
SHG-Bank Linkage model
Coady Institute, January 2012
What is the innovation?Informal collectives (Self Help Groups – mostly women, mostly rural) in India are now able borrow money from formal banks to on-lend to their members. No formal registration is required. No bank approval of individual loans is required. SHGs access loans on the basis of credit worthiness.
SHG-Bank Linkage model
Why the innovation?
Women’s access to commercial savings and credit services was highly restrictive. Women in SHGs resisted the government interference that formal registration would entail. Confidence in SHG monitoring systems to demonstrate credit-worthiness + lowered transaction costs of group loans persuaded change in India’s Central Bank policy nation-wide.
So what? Increases women’s collective access to
(and distribution of) credit opportunities for self-paced increase in
loan amounts for a diversified livelihood strategy for individual members: Investments in land, agricultural inputs, business investments, education
Coady Institute, January 2012
Any Question for Clarification?
Coady Institute, January 201
Inclusive innovation?
Intensive and long term capacity building is required – legal and regulatory changes are not enough.
Role of the intermediary organization needs to be underscored PRADAN: Producer Co SEWA: RUDI MYRADA: SHG
Coady Institute, January 2012
Oxfam GB’s Conceptual Framework
Comments and Questions?
Thank you
Coady Institute, January 201