Dr. George Njenga, Dean of Strathmore Business School (SBS) participated in the International Conference on Innovation in the African Development Strategies. The Conference which took place at the headquarters of Consiglio Nazionale delle Ricerche (CNR) in Rome on 2nd October, 2014 had the aim of exploring new opportunities and pressures for innovation that are faced in Africa and the major challenges faced together with Europe in a globalized economy.
CNR and SBS have partnered for the purpose of research in ‘Sustainable Agribusiness’ sector and ‘Developing Biotechnology for Africa’s Development’.
In his Key note address, Dr. Njenga spoke on the issue of Sustainable Agribusiness and Food security. He began by noting that Agribusiness and Agriculture accounts for nearly half of the GDP across the continent and the sector employs roughly 60% of the labour force. This notwithstanding, global pressure on agribusiness continues to increase with the demand for food expected to double by 2050.
He raised the issue of what sustainable agribusiness really meant. The agribusiness Industry has a number of stakeholders and different stakeholders have varying perspectives as to what sustainability means in the context of agribusiness, however the common ground in all their perspectives is:
? The need to approach agribusiness as a socially responsible business
? Respect and protect the environment
? Operating with integrity and ethics
? Recognize the benefits that businesses can bring to the local communities
The Dean mentioned three important factors that can be considered in promoting sustainable agribusiness; that is productivity, capacity and purchasing practices. It is estimated that for each 10% increase in small-scale agricultural activity in Sub-Saharan Africa, almost 7 million people are moved above the dollar- a day poverty line.
Productivity levels in Southern South Africa have however been extremely low owing to poor weather conditions, low access to knowledge and resources, low access to financing and markets, technology, infrastructure and agricultural inputs.
Value addition in Africa is extremely low and in high- income countries, agribusiness adds about US$180 of value by processing one tone of agricultural products, and African countries generate only US$40. While 98% of agricultural production in high income countries undergoes industrial processing, in African countries less than 30% is processed.
The second factor that can be considered in promoting sustainable agribusiness is good governance. Doing business in an ethical and transparent way is critical for sustainable agribusinesses. Corruption has undermined economic, social and environmental goals and made communities poorer. As a result, an increasing number of companies are now ensuring the traceability of their supply chains to manage the associated business risks.
Finally, there is a great need for us to manage the environment and climate changes because they are critical sustainability issues. Agribusinesses are being affected by climate changes through land use and cutting down forests consequently impacting on the quality of crops, pasture, forests and livestock. Sustainable agribusinesses need to consider their operations in a resource constrained world, management of greenhouse gas emissions throughout the value chains and adapting to the risks caused by climate change.
In addition Dr. Njenga talked about the importance of having standards and certification in agribusiness. Standards and certifications help companies put management systems in place to demonstrate how they are managing social, environmental and governance issues.
Agribusinesses have been accorded the responsibility of ensuring food security while at the same time faced with issues such as climate change and water shortages. They must find ways to produce more food with less land, make more efficient use of water, reduce fossil fuel inputs and reduce greenhouse gas emissions. Environmental (and social) management systems can help businesses manage their risks and impacts. Efficient use of resources is critical for sustainable businesses and can reduce costs and increase profitability.
The Dean further observed, For successful agribusinesses, sustainable supply chains are critical. Buyers and retailers are now looking for ways to engage small holders in sustainable agribusiness as part of their supply chain and community investment strategies. Small holder engagement strategies have helped companies minimize production costs, stimulate local demand and grow products suited to local markets.
He concluded his speech by quoting Gunner Myrdal, It is in the agribusiness sector that the battle for long-term economic development will be won or lost.