Solidaridad the Netherlands 2012 Annual Report

Solidaridad The NeTherlaNdS 2012 aNNual reporT

2 TheSolidaridad2012annualreport

Textandediting:DavidAlexanderandMichaelGould–finalediting:MichaelGould–design:DaanvanBeek–print:Pascal,Utrecht,theNetherlands–photographsSolidaridad,unlessotherwiseindicated–coverphotos:PietdenBlanken

ThisannualreportisavailableonlineinPDFformatfromwww.solidaridad.nlSolidaridadtheNetherlandsisregisteredasafoundationattheChamberofCommerceinTheHague,number41150939.Thisannualreportcanbeordered(freeofcharge)atthesecretariatinUtrecht,theNetherlands.

Solidaridad’tGoylaan15, 3525AAUtrecht,theNetherlandstel:+ 31(0)30 272 03 13fax:+ 31(0)30 272 01 94e-mail:[email protected]

Contents

ForewordSolidarityneedstoberobust 5

Vision and strategy 7AnewvisionandmissionstatementChangethatmatters 8MonitoringandevaluationImprovingratherthanproving 10FoodsecurityAnewtriple-Afoodsecuritystrategy 12FoodsecurityprogrammeinBangladesh 13HowwebuildproducersupportprogrammesMoreambitiousfarmersupport 14

Product groups 17FinanceandresultscommodityprogrammesGlobalinvestmentsandproducersupport 18Partner contributions for producer support 21CoffeeSuccessleadstonewprojects 22TeaMainstreamingsustainabilityacrossAsia 24CocoaScalingupcocoaproductioninWestAfrica 26FruitandvegetablesSustainablejuiceandfoodsecurity 28CottonBettercottonprojectshavevisibleimpact 30TextilesAllsetforamajorscale-upin 2013� 32GoldRisingprofileforfairtradegold 34SoyFirstprojectsinChinaandMozambique 36PalmoilGlobalprogrammestartstobearfruit 38SugarcaneImportantstepasethanolreachesEurope 40

LivestockFirstactivitiesinthelivestockprogramme 42

regional development 45NetworkfinanceTheSolidaridadnetworkgainsstrength 46The Solidaridad network financial overview 47SolidaridadSouthAmericaRuralHorizons,anewsolutionforfarmers 48SolidaridadAndesCreatingplatformsforsustainabletrade 49SolidaridadCentralAmericaRoundtablestakeholdintheregion 50SolidaridadWestAfricaSmallholderpalmoilforlocalmarkets 51SolidaridadSouthernAfricaFormingpartnershipsacrosstheregion 52SolidaridadEasternandCentralAfricafromsubsistencetocommercialfarming 53SolidaridadSouthandSouth-EastAsiaFoodsecurityprogrammeinBangladesh 54SolidaridadChinaInterventionstartswithfarmers’ambition 55SolidaridadtheNetherlandsCampaignsraiseSolidaridad’sprofile 56SolidaridadNorthAmericaNewregionalofficeinSanFrancisco 57

governance, supervision and finance 59CommunicationSolidaridadreachesabroaderpublic 60Supervision,managementandorganisationFullsupervisorystructurenearlyinplace 64Organisation development in progress 67

Financialreport 69Auditor’sreport 76Glossary 77

TheSolidaridad2012annualreport 3

triPle-a food SeCurity

achieving food security for all, involves tackling a number of inter-related challenges. Solidaridad has developed a comprehensive triple-a strategy to make this possible. triple a refers to interventions related to the availability, affordability and accessibility of food.

12

CoCoaSCaling uP ProduCtion in afriCa

in 2012 Solidaridad more than doubled investments in its cocoa programme. it took the lead in training trainers in nigeria and ivory Coast in multiple certifications of unorganized farmers.

26

south and south-east asiaa Shift of foCuS in aSia

Whereas in the past the focus was on sourcing in developing countries for markets in oeCd countries, now asia itself is the main market for most agro-commodities.

�54

neW ViSion and MiSSion StateMent

today, the world economy is not organized in a sustainable way. Many of us now realise that an unsustainable way of life threatens food security, the planet and businesses. read our new vision and mission statement.

8

Photo:AnnemariekevandenBroek

Photo:MariekeWeerdesteijn

4 TheSolidaridad2012annualreportPhoto:AnnemariekevandenBroek


Foreword

Solidarity needS to be robuSt

solidaridad is doing well. in 2012 the budget of the network organisation increased to € 26.9 million. an all-time high. this is 25 % higher than budgeted and a considerable growth compared to last year’s budget of € 18.3 million. in 2013 we expect to grow even more, to a budget of over € 40 million.

The global Solidaridad Network wasextended with an office in San Francisco–tocovertheNorthAmericancontinent– and staff worldwide grew to 190 (FTE)employees and freelancers on five conti-nents.

This rapid growth creates new opportu-nities, but also contains risks. Too rapid,uncontrolled growth can destroy anorganisation. So in the past year greateffortwasinvestedindevelopinginternalquality systems for the network in ordertobe able toabsorb the budget increaseeffectively. Adequate financial manage-mentandcontrolsystemswerefurtherdeveloped,aswellasamanagementinformationsystemandahigh-qualityresults-based management system for monitoring and evaluatingour programmes. Through developing these systems andtraining users, the quality of the organisation increased. For2013 as well we have developed an ambitious improvementprogramme to ensure that the organisation is at the desiredlevel. In this way our capacity to innovate and learn will beanchoredinthewaysofworkingandinthequalityoftheSoli-daridadstaffworldwide.

In 2012 – together with many people from Solidaridadregional offices all over the world – a new vision and missionstatementweredeveloped.Thiswasavaluableprocess,sinceit was encouraging to see that people with different back-groundscancometoasharedanalysisofthestatetheworldisinandthechallengesassociatedwithofferingmorepeoplea better chance to achieve a dignified existence. As a result,themissionofSolidaridadwasreformulated,leadingtoanewconsensusonwhatneedstobedone.

These investments in the quality of the organisation clearlydepend on an effective implementation of programmes thatcan make a difference to people’s lives. Solidarity must berobust. People need ways to move forward – not enslavedin an aid relationship, but independently, using their ownresources.

Inthepastyear,internationalcommodityteamswereformedfor the various sector programmes. In these teams all sectorspecialiststhroughoutthenetworkarelinked.Theteamsare

headed by an International ProgrammeCoordinator,whoisresponsiblefordevel-opingtheglobalSolidaridadstrategyforaspecific commodity, aiming at structuralchange of a sector towards sustainabledevelopment. In support of this, agree-ments can be made with global compa-niesanddonorsabouttheircontributiontothisprocess.Consequentlytheseplansare translated to the regional context.Each regional programme contributesto the global goals and is held respon-sible for effective implementation of theagreements made. This is crucial for thebindingnetworkSolidaridadstrivestobe:

decentralizedimplementationbylocalstaff–makingoptimaluse of local knowledge which contributes to a jointly formu-latedglobalstrategy.Thatiswhatmoderninternationalcoop-erationshouldlooklike.

Solidaridad is gaining more and more insight into the resultsof its programmes. Success rarely comes without failure.But ever larger groups of people are reached and poverty isbeing combatted effectively. Improved food production, asaferworkplace,accesstocleanerwater,andabetterincome.More and more actors are being involved in this process ofchange. Mainly companies. Local authorities are followingsomewhathesitantly.

Programmes are designed in such a way that finance, knowl-edge and skills remain available after the programme ends.So continuity is guaranteed. This way, our interventions willbecome ever more effective and will increasingly contributetogreaterwelfareformoreandmorepeople.

NicoRoozenExecutiveDirectorSolidaridadNetwork

Photo:RogerCremers

6 TheSolidaridad2012annualreportPhoto:H.P.AltingvonGeusau


ViSion and Strategy

• a neW ViSion & MiSSion StateMent

Change that matters

• Monitoring and eValuation

improving rather than proving

• food SeCurity

a new triple-a food security strategy

• hoW We build ProduCer SuPPort PrograMMeS

More ambitious farmer support


a new vision and mission statement

Change that MatterS

in 2012 solidaridad formulated a new vision and mission across the network. this was an intensive process, which took ten months and involved people from around the world.

redefining ValueS

The new statement was necessary because in 2010 Solidar-idad returned its historic mandate from the Dutch churchestothebishopsandsynods.Sincewearenolongerexclusivelyconnected to the Christian tradition, this created the oppor-tunitytoredefineourvalues.Inaddition,inrecentyears,newstructures have been developed. Governance and supervi-sion became international, with four continental supervisoryboards and an international supervisory board at the globallevel. Through the establishment of a Board of Directorsconsisting of the directors from the nine regional centres onfive continents, leadership has become a collective responsi-bility.Fromnowonresponsibilitiesaresharedbypeoplewithdifferentcultural,politicalandreligiousbackgrounds.

global reSPonSibilitieS

But perhaps the most important change was the fact thatduring this period of change Solidaridad has grown consid-erably – from 30 staff in the Netherlands to over 175 stafflocatedallovertheworld.Ournewvisionandmissionhadtoexpress the commitment and views of these new and cultur-allydiversestaff.Ithadtoconnectpeopleworkingindifferentregions, in their own context and with their own ambitions.Andwhat’smore,Solidaridadhadundergonearapidprocessof change in terms of strategy and practices. Most of thesechanges and developments had been written down some-where, but we lacked a summary document, a documentwhichwecouldusebothtocreateinternalconsensusandforexternalcommunicationwiththerestoftheworld.

broad diSCuSSionS

Theroadtowardsanewvisionandmissionbeganwithaseriesof interviews with key people within Solidaridad worldwide.How do they see the network? What does Solidaridad standfor in their view? From these interviews, a common charac-terisationemergedofwhatdrivesus.Theoutcomehasbeensummarizedaseffective idealism:weareanorganisationwithidealsthatwewanttotransformintoeffectiveaction,leadingtoresultsthatmatterforpeoplearoundtheworld. We have discussed our mission as well as our underlyingvalues, exploring questions such as who are we? Or perhapsmoreprecisely,whodowewanttobe? Our character and style was described as down-to-earth,reliable,a leader, independentandconfident.Andwewishtobeperceivedaspassionate,focused,open-mindedandcoop-erative. The most intensive discussions related to our vision

of the world and our analysis of crucial problems. Also aboutwhere we are now and where we want to be in the future.ThesediscussionstookplaceinDhakainBangladesh,Antiguain Guatemala, Johannesburg in Africa and in Utrecht in theNetherlands.

food SeCurity and foSSil fuelS

In our new vision statement a close connection is madebetweencreatingfoodsecurityforthe9billionpeopleontheplanet in 2050 and the end of the era of fossil fuels and theneed for a transition towards a bio-based economy. In thisway, an issue that is primarily related to hunger and under-nourishment is linked to the very basis of modern industrialsociety.Foodandrawmaterialsbothneedtobeproducedbyfarmers. This is possible only by optimising production andmaking it sustainable. As a result, the old model for develop-ment aid has become obsolete. The new focus is on interna-tionalcooperationinordertojointlysolveeachother’sprob-lems. Ournewvisionprovidesaclearanalysisoftheproblemandanattempttoarriveatasolution;andourmissionstatementcontainsawell-definedroleforSolidaridad.Thisincludesthedecision to form an international network organisation, alearningorganisationwiththepotentialtohavearealimpact,as well as the role of transition manager, engaging withcompaniesandgovernments. Solidaridad has a distinctive responsibility in its role as acivil society organisation determined to organise marketprocesses in a way that will result in socially and ecologicallydesirable outcomes. We have a vision of ending poverty,creatingopportunitiesforpeople,greaterprosperity,endingoppressionandensuringthatnaturalresourcesremainavail-ableforfuturegenerations. ThedescriptionofSolidaridadas‘anorganisationforinter-national cooperation that derives its inspiration from thevision,valuesandcapacitiesofpeoplefromallovertheworld’will guide us for the decades ahead. Dutch influence is nolongerdominant;thesearchforanewwayofrelatingtoeachotherhasbegun.


ViSion

Solidaridadenvisionsaworldwherethepeoplewhoproducetheresourcesonwhichwealldependcancontributetochangethatmatters.Changethatleadstoprosperityforall,withoutharmingeachotherortheenvironment,andthereforehelpstoensurethatresourceswillcontinuetosustainusforgenerationstocome.

Today,theworldeconomyisnotorganizedinasustainableway.Manyofusnowrealisethatanunsustainablewayoflifethreatensfoodsecurity,theplanetandbusinesses.

Withaworldpopulationprojectedtogrowto9billionpeopleby2050wecanonlybefediftheagriculturalsectormakesatransitiontosmartandsustainablelanduse.Andasfossilfuelusebecomesincreasinglyproblematic,atransitiontoabio-basedeconomyisneeded.Farmersworldwidethereforehaveabrightfutureasprovidersoffoodandsuppliersofrenewableenergyandrawmaterials.Theylinkasneverbeforetheissuesoffoodsecurityfordevelopingcountriesandprosperityfortheworldasawhole.

Thereisoneagenda,onechallenge.Wehavetoproducemorewithless,andensurethatitisdoneinawaythatsustainspeopleandtheenvironment.Optimisinglanduseisagoodstart.Increasedproductionmustmeetgrowingdemand,butwithfewernegativeconsequencesforpeopleandtheenvironment.Moreefficientproductionmustbecoupledwithlesspollution.Theremustbegreaterprecisionintheuseoffertilisersandpesticides,andareductioninwaterandenergyuse.Thenwastebecomesathingofthepast.Lossesinthesupplychainarereduced.Forestsarenolongercutdownandadditionallandisnolongerneededbecausetheexistingagriculturallandisbeingusedmoreefficiently.

Aninclusiveeconomy-oneinwhichpeoplecanparticipatefully-isneeded.Itshouldstartwithrecognitionofthepotentialofsmallholderfarmersandwomen,whoareoftentheleadingdriversofsustainablechange.Itwillrespectworkers’rights,provideasafeandhealthyworkplace,andsupportalivingincomeforfarmersandworkers.

Forchildren,schoolisthebestplacetowork.Miningandindustryneedtoswitchtoaresponsiblemeansofproduction.Workerrightsmustberespectedandtheenvironmentneedstobepreservedforfuturegenerations,keepingitspotentialintact.

Thechangeweseekisamarketprocessthatisdrivenbytheprivatesector.However,civilsocietyorganisationsandgovernmentsplayanessentialroleinenablingandencouragingtheprocessofchange.Inthisprocess,Solidaridadisatransitionmanager.Itbacksfarmerswhoareeconomicallypoorbuthaverichpotential,entrepreneurialmenandwomen,andworkerswhowanttobuildtheirlivelihoodsonafairincome.Solidaridadworkstogetherwithpartnersthroughoutthesupplychain,sothateveryonecanbeinvolvedcreatingchangethatmatters.

MiSSionSolidaridadisaninternationalnetworkorganisationwithpartnersallovertheworld.Thereisoneagendaandonestrategy:togetherwelearnandprogress,togetherweachieveresults,andtogetherwedecideonfuturesteps.

Solidaridadisanorganisationforinternationalcooperationthatdrawsinspirationfromthevision,valuesandcapacitiesofpeopleallovertheworld.

Solidaridadisatransitionmanager,focusingonproducersupport,asustainablesupplychainandmarketdevelopment.Wepartnerwiththosewhowanttomakeadifferencebychangingbusinesspracticesfrombeingpartoftheproblemtobecomingpartofthesolution.Marketshavetoworkforthepoorandcompaniescanbethekeychangemakers.

Solidaridad’saimistomakeanimpactbybeingthebestinbuildingpartnerships,pilotingandscalingupprogrammes,andlearningandinnovation.

Withoutadreamthereisnofirststep.Atthebeginningtherearenopavedroads;simplybystartingtowalk,apathiscreated.Knowledgeandvaluesareneeded.Skilledandmotivatedpeopleareourcapital.Wearerealistswithamission.Weturnsharedvisionintomeaningfulimpactincommunities.

froM a Shared ViSion to

Change that MatterS

Many of us now realise that an unsustainable way of life threatens food security, the planet and businesses.

there is one agenda, one challenge. We have to produce more with less, and ensure that it is done in a way that sustains people and the environment.

Solidaridad is a transition manager, focusing on producer support, a sustainable supply chain and market development.


figure 1: Why do we learn?

internal purpose external purpose

need for clear, concrete information • Operationsmanagement(decisionandcontrol)

• Accountabilityinalldirections

need for open information • Organisationallearning• Generationofnewknowledge

• Empowerstakeholders(beneficiaries,policymakers,privatepartners,etc.)

• Forcommunication&PRandtogainsupportamongnewstakeholders

iMProVe organiSational PerforManCe

monitoring and evaluation

iMProVing rather than ProVing

the past year was an exciting one for Planning monitoring and evaluation (Pme). we have now moved decisively away from single programme management towards a horizontal, learning agenda that focuses on improving rather than proving results. this new approach will involve all regional expertise centres.

learning netWork

In 2012 a shared learning vision was adopted that incorpo-rates new ways to improve organisational performance (seeFigure1).

reSultS-baSed toolS

Firstly, we have chosen Results-Based Management (RBM)–an impact-driven planning, monitoring and evaluation meth-odology that is based on principles established by the DonorCommittee on Enterprise Development (DCED). At its coreis a Theory of Change, which focuses on sustainable inter-ventions (see Figures 1 and 2). This new approach will helpus further improve the quality and management of ourprogrammes and better communicate our strategies andresults(seeFigure2). The Farmer Support programme, which is currently usedfor five commodities network-wide, was the first to adoptRBMandbytheendof2013itisexpectedthatallcommodityprogrammeswillhavedoneso.Ourpartnersarealsoencour-aged to work with RBM. For example, the Dutch sustainabletraining initiative IDH is adopting it in parallel with our initia-tive.

Making our ProMiSe a reality

Secondly, a new web-based Programme Management Infor-mation System (PROMIS), which was developed in 2011, wasrolled out network-wide in 2012. We have now reached acrucialmilestoneinimprovingourprogrammecyclemanage-ment. This system helps us to centralize management infor-mation – including financial information and project results– storing it and sharing it throughout the network, allowing

us to monitor progress more efficiently. In 2013, the threefounding fathers of PROMIS: Solidaridad, HIVOS and elec-tronic government foundation ICTU will set up a formal plat-form,allowingusandotherorganisationsthatadoptPROMIStoshareexperiencesandfurtherco-developthesoftware.

learning froM eaCh other

Thirdly, supported by the Dutch capacity-building organisa-tionPSO,network-widelearninghasbeenenhanced,resultingin shared visions between regions and programmes, as wellas support from management in terms of manpower andinvestments in PME and communication. A Wageningen URmodel identifies a shared vision, competences and manage-ment support as critical success factors. Another key factor–creatingalearningculture–presentsachallengeintermsofaligningknowledgenetworksprogrammewide.

eValuating our learning netWork

In 2012 PSO commissioned an external evaluation to identifylessonslearnedandassessitsowncontributiontodevelopinga learning network. PSO has enabled people to meet face toface and thus speed up the development of the network.The Learning Work Trajectory, which ran from 2010 to 2012,encouraged co-development and exchange of tools acrossprogrammes and between regions. Findings from the evalu-ation show that co-development of tools by regions is chal-lenged by cultural differences and that in exchanging prac-tices it is useful to identify constraints and inspire colleaguesto align objectives and strategies. Linking this programmeto overall network development and adjusting it to meetdemandwhereveritisstrongestareconsideredtobekey.


IMPACT

SUSTAINABLESECTOR DEVELOPMENT

TARGET GROUPPERFORMANCE

UPTAKE

TRIGGER

CROWDING IN

SUSTAINABLESYSTEMICCHANGES

COPYING

INTERVENTION

BUSINESS MODEL

SECTOR ANALYSIS

Sustainable impactonlivelihoods,futureperspectives,theenvironmentandeconomyareultimategoals.

Sustainable sector developmentcoverssector-widegrowthofeconomic,socialandenvironmentalsustainablepracticesandreductionofbadpractices.

target group performanceisachangethattakesplaceasaresultofadoptednewpracticessuchasincreasingyields,reducingpesticideuseandhigherreturnsoninvestment.

trigger,andthereactiontoit,uptake,arecombinedinabusinessmodelforthetargetgroup.Triggerscanbe,forexample,train,sell,build.Uptakecanbebuy,use,apply.

the interventionbySolidaridadorapartnerofSolidaridadinitiatesthechange.

Sector analysisisanassessmentofthetargetgroupsandissuesinthesector.Itidentifieskeyconstraintsandkeyactorswhocanbeinvolvedinchange.

reVieWing the tea PrograMMe

In 2012, LEI at Wageningen UR completed a mid-term reviewof the Solidaridad/Utz tea programme in Kenya and Malawi.The aim of the review was to gain insights into the mid-termresults of the programme. The lessons learned will be takenintoaccountwhenfurtherdevelopingtheteaprogrammesinKenyaandMalawiandsharedwithothertearegions.

eValuating the CoCoa PrograMMe

Inmid-2012,Solidaridad,UtzCertifiedandIDHjointlystarteda qualitative mid-term evaluation in order to be able to tellthestoryoftheirjointCocoaImprovementProgrammefromthe perspective of stakeholders. This holistic programme,which was organized by Solidaridad, IDH and Utz Certified, isdesigned to transform the cocoa market in the direction ofsustainablechange. Between June and December 2012 KPMG interviewedten internal and external stakeholders in the cocoa sector,ranging from producer cooperatives, extension services andgovernmentrepresentativesinproducercountriestotradersandmanufacturersinEurope.Theirfinalreportisexpectedinspring2013.

figure 2. the Solidaridad result chain

the lessons learned from a review of the Solidaridad/utz tea programme in kenya and Malawi will be taken into account when further developing the tea programmes.


Food seCurity

a neW triPle-a food SeCurity Strategy

achieving ‘food security for all’ involves tackling a number of interrelated challenges. solidaridad has developed a comprehensive triple-a strategy to make this possible. triple a refers to interventions related to the Availability, Affordability and Accessibility of food.

Theruralpartsoftheworldfaceprofoundchallenges.Thisiswhere around three-quarters of the world’s poorest peoplelive and face challenging conditions. These include increas-inglylimitedresources(especiallywaterandland)andmigra-tionofyoungerpeopletourbanareas.Yet,itwillbenecessaryto intensify agricultural production in order to feed a thirdmorepeopleworldwideinthecomingdecades.Wewillneedto preserve the ecosystem that agriculture has played a partin degrading and to be able to offer communities that deepsenseofrootednesswhichissovaluabletosociety. To do this, however, farmers cannot continue producingin the same way. Smart, sustainable land use is the way to go.Solidaridad believes that small and medium-sized farmers– including women – should be the primary focus of invest-ment, recognizing that private enterprise will play an impor-tantroleinmanysolutions. Achieving ‘food security for all’ involves tackling a numberof inter-related challenges. Solidaridad has developed acomprehensiveTriple-Astrategytomakethispossible.TripleA refers to interventions related to the Availability, Afford-abilityandAccessibilityoffood.

aVailability

Wehavetodefineourgoalsintermsofhumannutritionratherthan simply ‘more production’. But both volume and qualityareimportant.Sufficientnutritiousfoodmustbemadeavail-able to meet the needs of a projected global population of 9billion people in 2050, who will expect more nutritious food.It is anticipated that production of the major agriculturalcommodities will need to be increased by 70% to 100% inthenextfewdecades.Toachievethisthereissimplynootheroption than optimizing land use in areas already under culti-vation as well as in degraded areas. There is hardly any spaceforexpansionbecauseofthepotentialimpactonbiodiversity.More efficient production must be combined with signifi-cantly less waste throughout the food chain and fewer nega-tive consequences for people and the environment. Maxim-isingagriculturalproductionbycombiningsmartlanduseandcrop selection with increased soil fertility, and adapting tochangingclimateconditionsandreducedavailabilityofwaterrequires rationale choices and good governance. Optimalinstitutionsareessentialforsuccess.

affordability

In a market economy farmers can only address the urgentneed for food if consumers have purchasing power. Farmers

cannotproduceforhungrypeoplewhoareunabletopayforthefoodtheyneed.Iftheseissuesarenotaddressed,produc-tion will focus exclusively on the rich of the world, leading toa combination of growing obesity in some parts of the worldwith hunger in others. There is a rise of the consumption of‘empty’calories(foodoflownutritionalvalue)inmanydevel-oping countries alongside a dramatic increase in clinicallyoverweight people in industrial economies. Nutritional foodmustbeaffordableforthemajority,giventhefactthat80%oftheworld’spopulationhaveanincomeoflessthan10dollarsaday.Atthesametime,foodpricesmustreflecttherealcostsof agricultural production, including the social and ecolog-ical costs. Solidaridad sees this as the core challenge for aneffective strategy to provide sustainable, low-cost food. Thecosts of introducing sustainability must be compensated byhigher yields and better nutrition, resulting in healthier foodand lower transaction costs. This requires nothing less thana technological revolution, making use of all of the scientificresearchavailable,includingbiotechnology.

aCCeSSibility

Agricultural products cannot always be produced close towhere people live. Due to rapid urbanization most peoplenowliveincities.CountriessuchasChina,whichcannotfeedtheir own population because of a shortage of arable land,will become the main importers of food. Effective distribu-tionisthekeytobridgingthegapbetweenareaswherefoodis produced and where it is consumed. One third of all foodproducedintheworldgetslostorwasted.Effectiveorganisa-tionofthesupplychain,includingwell-developedretailstruc-tures,willbedecisiveinensuringaccesstofoodinallpartsoftheworld.

Solidaridad believes that small and medium-sized farmers – including women – should be the primary focus of investment, recognizing that private enterprise will play an important role in many solutions.


food SeCurity PrograMMe in bangladeSh

InBangladeshSolidaridadandCareBangladesharepioneeringtheSustainableAgriculture,FoodsecurityandLinkagesprogramme(SAFaL),whichwilladdress200,000farmers’agriculturalchallenges.Itwillincreasetheavailabilityofaffordable,nutritiousfoodandcomplywithfoodcompanies’qualityandsustainabilityrequirements.ItisfundedbytheDutchgovernmentandwillprovideastrongcontributiontotheDutchEmbassy’sfoodsecurityprogramme.

SAFaLwillinvolveworkingwithinternationalfoodcompaniestocreateexportmarketaccessforBangladeshishrimpfarmersandgivingfarmersastrongincentivetoimprovethequalityoftheirproduceandintroducesustainablepractices.Thisinturnwillboosttheirincome.Professionalsmall-scalefarmerswhoearnagoodlivingcanthusmakeanessentialcontributiontosolvingtheproblemsthatplaguetheshrimpsector.

Solidaridadwillalsoworkwithfishfarmers.LocalpricesforfarmedPangasiusandTilapiaaregood,butqualityislow.Wewillthereforehelpfarmerstoincreaseproductivityandquality,sothatlocalaccesstosafe,healthyandnutritiousfishproductscanbeimproved.

Toachievethis,wewillworkcloselywithlocalsupply-chainstakeholders,suchasprocessorsandtransporters,aswellasretailersinkeymarkets.Togetherwewillinvestinefficiencyandqualitysothatmorevalueisaddedtothelocaleconomy,wasteisreduced,andtheavailabilityandaffordabilityofnutritiousandsafefoodisincreased.

Thesechain-wideinvestmentswillbeafirststeptowardsmeetinginternationalstandards,soimprovingthequalityoffarmedfishforlocalconsumptionwillalsohelptheentiresectortoincreaseitsexportpotential.

AkeycomponentoftheSAFaLprogramme’sstrategyistheVillageSupermarket(VSM).TheVSMisauniquemarket-placeconceptlinkingagro-foodchainsinSouthWestBangladesh,servingasamarketplace,servicecentreandbusinesshub,providingmarketinformationandknowledgeexchange.Asamarketitserveslocalconsumers,tradersandexportersaswellasfarmingprofessionalslookingforinputsandtechnicalsupport.Itwillalsoprovidecrucialcooling,icingandstorageinfrastructuretosupply-chainstakeholders.Bybundlingthesecrucialfunctionsunderoneroof,VSMswillincreaseefficiencyandreducewasteinsupplychainsandthuscontributetotheavailability,accessibilityandaffordabilityofnutritiousfoods.

Formoreinformationabouttheaquaculture,dairyandhorticultureinitiativesoftheSAFaLprogramme,aswellastheVSM,pleasecontactSelimRezaHasan([email protected]).

Solidaridad and Care bangladesh will involve working with international food companies to create export market access for bangladeshi shrimp farmers and giving farmers a strong incentive to improve the quality of their produce.


how we build ProduCer suPPort Programmes

More aMbitiouS farMer SuPPort

in 2012 solidaridad reviewed its producer support programmes. monitoring and evaluation had revealed some critical issues, which gave rise to this review. maximising production in small-scale farming clearly has its limitations.

Certifying PoVerty iS no Solution

One important lesson learned is the relatively limitedimpact of the producer support programmes on effec-tively improving smallholder farmers’ income. The generalpicture in coffee, tea and cocoa production is that the bestperforming smallholders (0.2 - 5.0 ha) with an average of 2.5hectares manage to raise their income through smart andsustainable land use practices from the historical low rangeof US$ 240 to 800 per year to US$ 2,400 to 3,200 per year.Although this means a significant change – improving liveli-

hoodsforfarmersandtheirfamilies–theirlivesarestillpoor.To be frank, with an income of less than US$ 10 a day, this ismerely a step from extreme poverty to poverty. It confirmsan often-quoted criticism of fair trade that, in spite of goodintentions and concrete improvements for farmers, thereality for most small-scale farmers is a shift from poverty tocertified poverty.However,inthebanana,palm-oilandsugar-cane sectors we have seen many smallholders improve theirincomeandlivelihoodssignificantly. Maximising production in small-scale farming using theconceptof ‘morewithless’clearlyhasits limitations.Asingleapproach on-farm programme is not sufficient to guaranteestructural changes. If we really wish to create new condi-tions for farming, other issues, such as increasing the scaleof production, farm organisation, processing, new technolo-

Photo:H.P.AltingvonGeusau

re-allotment and spatial planning by local government could accelerate the process of up-scaling.


Producer support programme for smart, sustainable land and water use

on farm

Producerdevelopmentstartingfromthedirectbenefitsforfarmers

More with less

off farm

Corporatesocialresponsibilityinthesupplychain

Markets work for sustainability

enabling environment

Policydevelopmentandinstitutionbuilding

Society works for sustainability

economic issues: • Productivity • Quality • Efficiency

Social issues: • Inclusionofsmallsizefarmers • Inclusionofwomen • Exclusionofchildlabour • Labourrights • Healthyandsafeworkplace • Livingincome/wage

environmental issues: • Reductionof: - Wateruse - Energy • Lower,morepreciseuseof: - Fertilizers - Pesticides • Wastemanagementandreuse • Soilfertility

• Farmerorganisationandcapacitybuilding• Supplychaindevelopmentandmarketing• Accesstofinancethroughagri-creditsand

equity• Managementofhighconservationvaluesto

protectbiodiversity• Carbonstockmanagementforthe

reductionofgreenhousegases• Paymentsforecosystemservices

• Landuseandwatershedplanning• Sustainablelandscapingandspatialplanning• Policydevelopmentonlegalissues,

institutions,taxesandlawsofsuccession• Integrationofsustainabilityinpublicsector,

privateinstitutions,financeandinvestmentpolicies

• Voluntaryregulationthroughmulti-stakeholdergovernancesystem

• Conflictprevention,resolutionandaccesstojustice

• Changeinternationaltradepolicies

giesandsupplychaindevelopmentarecrucial.Amorerobustagriculturalinfrastructureandbetterperspectivesforaviableincome for farmers – as well as living wages for agriculturalworkers–arealsoneeded.

Create eConoMieS of SCale

While Solidaridad is sensitive to land ownership issues indeveloping countries, scale is decisive. In many cases lawsof succession split farms into even smaller plots. Entrepre-neurial farmers must have the opportunity to buy land fromless successful neighbouring farmers to create economiesof scale. These changes should be accompanied by rural andagri-business development and the creation of employmentfor those who are no longer on the land. Re-allotment andspatial planning by local government could accelerate theprocessofup-scaling.

off-farM aCtiVitieS

A second lesson learned is related to the external effects offarming on climate and biodiversity. An off-farm programmeis needed to address these issues more effectively. Manage-mentofhighconservationvaluestoprotectbiodiversityareasrequires the development of tools to help the agriculturalsector take this responsibility. Carbon stock managementfor the reduction of greenhouse gases and payments forecosystemservicescancontributetothemitigationofemis-sions. For these purposes Solidaridad tested and improvedtheCool Farm Tool. Inspiteoftheseinitiativesit’simportanttoremainrealisticabout the mitigation versus adaptation agenda. It is unlikely

that the global community will limit global warming to theagreed level of 2 degrees Celsius. The Carbon Tracker initia-tive calculates the amount of carbon contained in provenfossilfuelreserves(i.e.thecarbonstoredinreservesthatareready to be used). According to these calculations, just onefifth of this amount is enough to increase temperatures by 2degrees.So,inordertobesafe,80%ofthosereservesshouldremain under ground. Since this would mean writing off US$20 trillion in assets, this is clearly not going to happen. Thereissimplytoomuchmoneyinvolved.So,inordertomakeagri-culturefuture-proof,asharperfocusonadaptingagriculturalpractices to the consequences of rapid climate change isnecessary.

SPatial Planning and reSolution of ConfliCtS

A third pillar that needs to be included in the transitiontowards a more sustainable agricultural sector (with the fullparticipation of smallholders) is related to policy develop-ment and institution building. The creation of an enabling environment by governments, financial and legal institutionsis urgently needed. Sustainable landscaping and spatial plan-ning are crucial instruments for organising effective use ofscarce resources. More optimal use of water is also needed.Pressure on limited resources will increase the chances ofconflict. Prevention and resolution of conflict and access tojusticeareindispensable. The coherence of the three-pillar approach reflects theunique contribution which a civil society organisation suchas Solidaridad can make, linking the business community,governmentsandcivilsociety.

16 TheSolidaridad2012annualreportPhoto:AnnemariekevandenBroek


Product grouPs

• Finance and results commodity Programmes

global investments and producer support

• coFFee

Fundraising leads to new projects

• tea

mainstreaming sustainability across asia

• cocoa

scaling up cocoa production in West africa

• Fruit and vegetables

sustainable juice and food security

• cotton

better cotton projects have a visible impact

• textiles

all set for a major scale-up in 2013

• gold

rising profile for Fairtrade gold

• soy

First projects in china and mozambique

• Palm oil

global programme starts to bear fruit

• sugar cane

important step as ethanol reaches europe

• livestock

First activities in the livestock programme


FinanCe and results Commodity Programmes

global inVeStMentS and ProduCer SuPPort

solidaridad develops globally coordinated sector-wide commodity programmes. this global sector strategy, which is rooted in regional activities and expertise, has led to higher investments and better results. this chapter, which provides thorough information about the development of all solidaridad sector programmes, starts with a global overview of investments and producers supported.

Directinvestmentsof€16millionweremadeinelevencommodityprogrammes,ofwhichcoffee,cocoa,soyandpalmoilwerethelargest.Investmentsincoffeewereinlinewiththebudget.Investmentsincocoaexceededthebudgetby€1.1million,mainlyduetoactivitiesinIvoryCoastandNigeria,whichweremanagedfromtheSolidaridadofficeinGhana.Investmentsinsoywere€0.5millionlowerthanbudget.

Partnercontributionsarecrucialfordevelopingeffectivesectorprogrammes.Suchcontributionsincludetime,knowledge,skills,tradeconditionsandinvestments.Solidaridadraised€8.8millionofpartnerinvestmentsintheMillenniumAgreementproducersupportprogramme(2009-2012)andhopestoraiseanother€39millioninthefollow-upFarmerSupportProgramme(seealso

Intermsofthenumbersoffarmers,workersandminerssupportedbySolidaridad,thecoffee,cottonandcocoaprogrammesarethemostextensive.Theresultsshownonpage21provideaninitialideaoftheimpactoftheprogrammes,sincetheyincludeactivitiesalongtheproduction-consumptionchain.

Solidaridad netWork PrograMMe inVeStMentS

secretariatNetherlandsChinaSoutheast AdiaEast&central AfricaSouthern AfrWest AfrCAMAndesSAM East&central AfricaSouthern AfrWest AfrCAMAndesSAM

0

2000

4000

6000

8000

10000

NetherlandsChinaSoutheast AdiaEast&central AfricaSouthern AfrWest AfrCAMAndesSAM

0

1000

2000

3000

4000

5000

OtherLivestockSugar canePalm oilSoyGoldTextilesCottonFruit and vegetables

CocoaTeaCoffee


Total Budget RECs Income

Personnel in FTE per REC

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Budget 2012

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

budget�2012 actual�2012 Planned 2013

Coffee 2,238,000 2,269,000 2,525,000

Tea 1,097,000 592,000 601,000

Cocoa 2,488,000 3,625,000 3,651,000

Fruitandvegetables 1,266,000 1,107,000 1,059,000

Cotton 1,396,000 2,391,000 4,115,000

Textiles 127,000 477,000 723,000

Gold 736,000 332,000 894,000

Soy 2,226,000 1,706,000 1,243,000

Palmoil 1,187,000 1,214,000 4,095,000

Sugarcane 1095,000 977,000 1,440,000

Livestock 492,000 138,000 239,000

Other 3,226,000 2,086,000 3,789,000

total programme investments* €�17,575,000 €�16,914,000 €�24,375,000

*HRMandofficecostsexcluded


NetherlandsChinaSouth and South East AsiaEast and Central AfricaSouth AfricaWest AfricaCentral AmericaAndesSouth America


co�ee tea cocoa fruit cotton textiles gold soy palm oil sugarcane livestock other





















co�ee tea cocoa fruit cotton textiles gold soy palm oil sugarcane livestock otheraCtual budgetS�2012 Per CoMModity and Per region (in euroS)

SolidaridadSouthAmerica

SolidaridadAndes

SolidaridadCentralAmerica

SolidaridadWestAfrica

SolidaridadSouthernAfrica

SolidaridadEasternandCentralAfrica

SolidaridadSouthandSouth-EastAsia

SolidaridadChina

SolidaridadtheNether-lands*

total

Coffee 29,000 221,000 181,000 0 0 1,381,000 31,000 0 426,000 2,269,000

Tea 107,000 0 0 0 71,000 129,000 138,000 67,000 80,000 592,000

Cocoa 8,000 5,000 40,000 3,446,000 0 0 20,000 0 106,000 3,625,000

Fruitandvegetables

4,000 29,000 0 6,000 0 1,066,000 0 0 2,000 1,107,000

Cotton 0 0 0 94,000 200,000 7,000 11,000 181,000 1,898,000 2,391,000

Textiles 0 0 0 0 0 0 36,000 0 441,000 477,000

Gold 5,000 59,000 0 130,000 0 37,000 0 0 101,000 332,000

Soy 1,334,000 0 0 0 0 0 119,000 40,000 213,000 1,706,000

Palmoil 179,000 20,000 0 784,000 0 0 0 0 231,000 1,214,000

Sugarcane 579,000 0 0 0 160,000 19,000 165,000 0 54,000 977,000

Livestock 103,000 0 0 0 0 0 0 0 35,000 138,000

Other 424,000 19,000 0 15,000 111,000 32,000 24,000 0 1,462,000 2,086,000

*ThefiguresofSolidaridadtheNetherlandsexcludedirectcontributionstootherSolidaridadexpertisecentres.TheyincludesomeactivitiesonothercontinentslikethecottonprogrammeinIndiaandAfricathatwasmanagedfromtheNetherlands.

























Coffee€�2,269,000

aCtual PrograMMe budget 2012 Per region

Colorsrefertoregions;seethebulletsinthetablebelow

tea€�592,000

Cocoa€�3,625,000

Cotton€�2,391,000

fruit and vegetables€�1,107,000

textiles€�477,000

Palm oil€�1,214,000

Sugar cane€�977,000

livestock€�138,000

other€�2,086,000

gold€�332,000

Soy€�1,706,000


























Coffee230,168�farmers and workers

tea61,050�farmers and workers

Cocoa114,039�farmers

Cotton145,131�farmers

fruit and vegetables4,536�farmers and workers

textiles7,600 workers




















co�ee tea cocoa fruit cotton textiles gold soy palm oil sugarcane livestock otherPalm oil

21,311�farmers and workersSugar cane

51,756�farmers and workerslivestock

300�farmers and workers

gold2,838 miners

Soy40,240�farmers and workers

number of producers (farmers, workers or miners) supported

Producersin:SolidaridadSouthAmerica

SolidaridadAndes






SolidaridadChina

total

Coffee(farmersandworkers)

127,206 9,653 89,137 4,172 230,168

Tea(farmersandworkers) 700 1,156 46,215 8,979 4,000 61,050

Cocoa(farmers) 409 109,630 4,000 114,039

Fruitandvegetables(farmersandworkers)

4,336 200 4,536

Cotton(farmers) 50 41 26,054 53,051 3,600 56,857 5,478 145,131

Textiles(workers) 5,000 2,600 7,600

Gold(miners) 1,613 500 725 2,838

Soy(farmersandworkers) 12,240 27,000 1,000 40,240

Palmoil(farmersandworkers)

3,185 522 1,912 3,118 12,574 21,311

Sugarcane(farmersandworkers)

3,599 21,834 2,169 24,154 51,756

Livestock(farmersandworkers)

300 300

total 20,074 133,718 33,808 139,302 56,376 139,877 142,736 13,078 678,969

ProduCerS SuPPorted Per PrograMMe and Per region

Colorsrefertoregions;seethebulletsinthetablebelow


Partner ContributionS for ProduCer SuPPort

From2009through2012SolidaridadNetwork,WWFUSandtheRoundtablesforpalmoil(RSPO),soy(RTRS)andsugarcane(Bonsucro)carriedoutabroadproducersupportprogrammewithanumberofcompanies.Thisprogrammeresultedfromthe‘MillenniumAgreement’oftheDutchMinistryofForeignAffairs,whichfundedthis€4.8millionprogramme.

Thepartnercontributions,bothfromprivateandpublicsources,haveincreasedfrom€700,000in2009toover€4.7millionin2012.Intheperiod2009-2012,theprogrammeattractedover€8.8millionofadditionalfundingfrompartners,increasingthetotalprogrammebudgetto€13.6million.

Alargenumberofbrandsandcompanieshavebeenlinkedtotheactivitiesoftheprogramme:

− Inpalm oil:NewBritainPalmOil(PapuaNewGuinea),GrupoDaabon(Colombia),Agropalma(Brazil)Johnson&Johnson,ConoKaasmakersandBen&Jerry’s.

− Insoy:Gebana(Brazil),APDC(Brazil),adozencooperativesinIndia,S.D.TataTrust,FrieslandCampina,Keurslagers(theNetherlands),ConoKaasmakers(theNetherlands),Unilever,Arla,InterchickenandIFC.

− Insugar cane:EIDPerry(India)andproducergroupsinMalawi,HondurasandPakistan,SuikerUnieandDeliciafromtheNetherlands

TheprogrammewascarriedoutbylocalpartnersandmanagedbySolidaridadSouthAmerica,CentralAmerica,

SouthernAfricaandSouthandSouth-EastAsia.In2012alone,over48,500small-scalefarmersweresupportedinimplementingbettermanagementpracticesandmorethan12,000farmworkersweremadeawareoftheirrightsintermsofRoundtablestandards.Togetherwithpartners,Solidaridadworkedin11countries:Brazil,India,Honduras,Colombia,Belize,Ghana,Malaysia,Pakistan,Indonesia,MalawiandSouthAfrica.

SolidaridadhasbeenabletocontinueandupscaleitsactivitiesintheFarmerSupportProgramme,thankstoinitialfundingworth€29.5million.Ourambitiousaimistoattractanother€39millionofpartnercontributionsfrompublicandprivatesourcesandthuscreateoneofthelargestpublic-privatepartnershipsindevelopmentcooperation.ThroughthisprogrammethepartnershipswiththeRoundtableswillcontinueuntil2015.OtheraspectsoftheMillenniumAgreementincludenewprogrammeswithIDH,NORAD,theDutchEmbassiesandtheSharpinitiative(withSimeDarby,IFC,IDHandProForest).

Theproducersupportprogrammewillbeevaluatedin2013.

ProduCer SuPPort inVeStMentS Millenium agreement (2009-2012)

initial funding: € 4.8 million

Partner contribution: € 8.8 million

total € 13.6 million

ProduCer SuPPort inVeStMentSfarmer Support Programme (2011-2015)

initial funding: € 29.5 million

expected partner contribution: € 39 million

expected total: € 68.5 million

in 2012 alone, over 48,500 small-scale farmers were supported in implementing better management practices and more than�12,000 farm workers were made aware of their rights in terms of roundtable standards.


-

CoFFee

SuCCeSS leadS to neW ProjeCtS

innovation and fundraising was a priority in 2012, as several projects came to an end and the main programme, which is funded by irish aid, will end in 2013. new projects include Climate smart agriculture in mexico, Peru and Colombia; Food security in ethiopia and Kenya; and a sustainable coffee programme in Colombia.

PrograMMe Setting

For most of the world’s 25 million smallholder coffeeproducers, farming is no longer an attractive or sustainablebusinessusingtraditionalpractices.There’sanurgentneedtoproduce more and better quality coffee with fewer negativeimpactsonpeopleandtheenvironment.Solidaridadprovidesfarmerswithpracticalsolutionswhichmakethemmoreresil-ient to climate change and food insecurity. Solidaridad alsodevelops viable business cases for small-scale producers incollaborationwiththeprivatesector.Farmersneedeconomicincentives to improve their agricultural practices and certifi-cationcanplayaroleinthis.Tomotivatefarmerstochangetosustainablepractices,thebestapproachistostartwiththoseaspects that will deliver fast visible results, such as reducinglossesduringharvesting.

ProgreSS

The main projects are Irish Aid-funded projects in CentralAmerica and East Africa. Both focus on farmer supportthroughtrainingandincludemarketlinkage,accesstofinanceand special attention to the role of women. The approval ofnewproposalshasledtofournewprojects:1. Bringing agricultural insights to those engaged in miti-gating climate change through REDD+. This project focusesonClimate-SmartAgricultureincoffeeproductioninMexico,Colombia and Peru. It should lead to higher productivity andincomes,bettercarbonperformanceandenhancedresiliencetoclimatechange.2. A food security/rural development programme in EastAfrica,togetherwithfarmerorganisations,theKenyancoffeeresearch institute and the coffee companies Nestlé, ECOMand Armajaro. The goal here is to improve farmers’ resilienceby combining coffee as a cash crop with intercropping of aselection of food crops for farmers’ own consumption andfor sale on local markets. This should lead to more stableincomesforthefarmersthroughouttheyear,accesstomorenutritious food, and increased availability of food on localmarkets.3. Solidaridad is bringing Colombian stakeholders in coffee,bananas, flowers and palm oil in a platform together to worktowards more sustainable production and to increase tradewith the Netherlands. Solidaridad will facilitate and supportthe convening platform, which is financially supported by theDutchEmbassyinColombia.4. Solidaridad is an official partner with Armajaro and ECOMin the Deutsche Investitions- and Entwicklungsgesellschaft

(DEG) programme in Kenya and Tanzania, which is fundedby the Bill & Melinda Gates Foundation in collaboration withHivos. The Program of Sustainable Quality (PROCASO) inHonduras matured in 2012 from a donor-supported tech-nicalassistanceprogrammerunbySolidaridadandSNVintoaserviceorganisationthatworksdirectlywithcoffeeexportersand cooperatives on certification, professionalising supplychainsandmakingthemmoresustainable. InPeruaneducationprogramme(GoodAgriculturalCoffeePractices) started at four colleges. The students practice thenewtechniquesontheirparents’farms,resultinginhighadap-tation rates of sustainable techniques. The local governmentisexploringwaystoexpandthisprogrammetoothercolleges.

StrategiC PartnerS

Nestlé can become a strategic partner for the Solidaridadcoffee programme due its considerable influence on thecoffee supply chain. Solidaridad is contributing to Nestlé’sCSR strategy by delivering input for rural development anddevelopingprojectsincountrieswhereNestlésourcescoffeedirectlyfromproducers. To scale up its programmes Solidaridad works closelywith the largest coffee traders, which train farmers such asECOM,ArmajaroandVolcafé.FarmersaresupportedinIndia,Vietnam, East Africa and Latin America. Solidaridad providessupport for curriculum development, training of trainers inGood Agricultural Practices and cross-cutting issues suchas the integration of women in supply chains in East Africa.Solidaridad also works closely with cooperatives, NGOs andcoffeeboards.

donorS

The Irish Fair Trade Network supports Solidaridad finan-cially (through a grant provided by Irish Aid) in implementingprogrammes in Nicaragua, Honduras, Guatemala, Ethiopia,Kenya, Tanzania and Uganda. This support started in 2006andover120,000small-scaleproducershavealreadyreceivedsupport. In 2013 Solidaridad will apply for a new coffeeprogrammeinEastAfrica.

iMPaCt

The Centre for International Development Issues Nijmegen(CIDIN)hasbeenaskedtocarryoutafour-yearimpactassess-ment of the farmer support programme in East Africa. Publi-cationisexpectedinthesummerof2013.


-

230,168 farmers and workers are being supported in the coffee sector

€ 221,000

€ 181,000

€ 29,000

127,206farmersandworkerssupported




€ 1,381,000

€ 31,000

€ 426,000

DRCongo

Tanzania

Kenya

UgandaEthiopia

India

MarketdevelopmentandcommunicationinEurope

Mexico

Guatemala

Honduras

Nicaragua

Peru

Colombia

Budget2012€ 2,238,000

Actual2012€ 2,269,000

Planned2013€ 2,525,000

Vietnam

Selective hand picking of only the ripe cherries, which is primarily done with the higher quality arabica beans. there’s an urgent need to produce more and better quality coffee, with fewer negative impacts on people and the environment.



-

tea

MainStreaMing SuStainability aCroSS aSia

asians consume 74 % of all of the tea produced in the world. in 2012, solidaridad initiated a programme funded by the sustainable trade initiative (idh) and hindustan unilever limited designed to sustainably transform half of the tea produced in india. this programme will benefit over half a million smallholders and plantation workers.

Creating a SuStainable SuPPly for neW MarketS

In2012,aSolidaridad-ledconsortium(togetherwithUtzCerti-fiedandDEFoundation/D.E.MasterBlenders1753)completeda four-year-long intervention – the Tea ImprovementProgramme (TIP) – which was co-funded by the SustainableTrade Initiative (IDH). The Utz standard has now been intro-duced in nine major tea producing regions, covering 63,765MTofcertifiedteagrownon34,042hectares.However,duetodifficultiesingettingcertified,smallholdersareoftenleftout,soakeyfocusforthepastthreeyearshasbeenonsupporting75,000teasmallholdersinimprovingtheirsustainabilityprac-tices. The emphasis of the programme is now on large-scalerolling out of sustainability initiatives for all markets in ordertosustainablytransformthesectorasawhole Solidaridad’s agenda of domestic tea market transforma-tion,whichwasinitiatedinIndonesiaandChinabyestablishingnational sustainability standards has now been extended toIndia as well. These interventions in domestic markets havecreated a strong basis for further development in all threecountries. For example, the Indonesian Teh Lestari standardis now well established. The plan is to cooperate with IDH– as well as tea businesses – to transform 50% of the small-holdersinIndonesia.TheChinateasustainabilitystandardhasbeen adopted by the China Tea Marketing Association andis being developed into a code. In India, as a follow-up to theTIPprogramme,aprogrammehasbeenstartedwithIDHandHindustan Unilever Limited, which will sustainably transform500 million kilograms (just over half of the tea produced inIndiaand20%ofalltheblackteaintheworld). The five-year India Domestic Sustainable Tea Programme(2012-2016)startedlastyear.Solidaridadistheimplementingpartner,targetingover600factories,halfamillionplantationworkers and 40,000 smallholders. It includes the develop-mentandimplementationofateasustainabilitycode. Teh Lestari – the worlds’ first locally developed sustain-ability standard for tea – was formally registered as anot-for-profit foundation in Bandung, Indonesia. By theend of 2012, Solidaridad, together with its partner BusinessWatch Indonesia, had certified 11,653 smallholders under thisstandard,covering6,575hectares.Thisaccountsfor18%ofallcertifiedteainIndia.

leSSonS learned

Inalarge-scalemarketintervention,it’sbettertoalignstrate-gieswithkeybusinessesinthesectorattheonsetratherthanadjusting mid-way. Also, to increase productivity through

certification, small farmers need to make large investments,which may not be repaid by the income they receive fromthe increased productivity. There’s a need for local owner-ship of standards, as has been shown with the fast uptake ofthe Lestari standard in Indonesia and the potentially massiveimpact of the Indian and Chinese tea standards. Finally, it’scrucial for Solidaridad to engage in tea trade policies andconnect the sustainability discourse with crucial demand,supply,qualityandpriceissuesatthegloballevel.

StrategiC PartnerShiPS

Solidaridad does not have global strategic partnershipswith any of the major tea brands or retail companies. This isbecause of the approach taken until 2010, in which certifica-tion standards were leading in developing business relation-ships. However, there are country-specific partnerships withHindustan Unilever Limited, whose Brook Bond brand ismarketleaderinIndia–theworld’slargestblackteamarket–withSariWangiinIndonesiaandwithSaraLeeinSriLankaforitsPickwickbrand.

donorS

The Sustainable Trade Initiative-IDH, was the main sponsorfortheSolidaridad-ledconsortiumwhichcoordinatestheTeaImprovement Programme and one of the key funders of theIndia Domestic Sustainable Tea Programme, with matchingfunds from Hindustan Unilever Limited. DE Foundation/D.E.MasterBlenders1753wasoneofthemajorco-sponsorsoftheTea Improvement Programme. DE Foundation also supportsSolidaridad’steaprogrammeinSriLanka.

iMPaCt

The Tea Improvement Programme has successfully assisted82,691 tea smallholders and 36,409 plantation workerswith social, economic and environmental issues (on 40,617hectares). Of these trained groups, 46,134 smallholders weresupported in achieving certification under various sustain-ability standards and most have increased their income by12.3%.TogetherwithUtzCertifiedandLEI,along-termimpactstudy was started in Kenya and Malawi in 2010. This showedthat average sustainability scores have gone up, along withsignificant improvements in terms of health and safety andenvironmentalissues.


-

61,050 farmers and workers are being supported in the tea sector

€ 107,000

700farmersandworkerssupported





€ 129,000

€ 71,000

€ 67,000

€ 138,000

€ 80,000

Argentina SouthAfrica

Malawi

Kenya

MarketdevelopmentandcommunicationinGermany,theNetherlandsandtheUnitedKingdom

India

SriLanka

China

Vietnam

Indonesia

Mozambique

Budget2012€ 1,097,000

Actual2012€ 592,000

Planned2013€ 601,000

the five-year india domestic Sustainable tea Programme, which started in 2012, is designed to support 40,000 smallholders, half a million plantation workers and 600 factories.

Photo:SjoerdPanhuysen


-

CoCoa

SCaling uP CoCoa ProduCtion in WeSt afriCa

the most important development in 2012 was scaling up the programme in west africa and developing programmes and consortia to increase productivity, rehabilitation and food security, while redressing the gender imbalance. the team in indonesia strengthened the national reference group and was instrumental in developing the indonesian sustainable Cocoa standard.

the Context

Cocoa is mainly grown by 5 million smallholders in WestAfrica, Asia, Central and South America. Around 70% of allcocoacomesfromWestAfrica.Manyfarmersareconfrontedwith declining yields and lack access to technical knowhowand inputs. The annual increase in demand for cocoa is 3%.Companies can secure their supply through sustainabilityprogrammes developed in partnership with Solidaridad.By building supply chain partnerships involving producers,traders, brands, retailers and governments Solidaridad issupporting technology transfer, organisational developmentandmakessurethatfarmersgetaccesstoservicesandinputs.

ProgreSS

In2012Solidaridadmorethandoubledinvestmentsinitscocoaprogramme.IttooktheleadintrainingtrainersinNigeriaandIvory Coast in multiple certifications of unorganized farmersand this approach can be replicated elsewhere. The focus onsmartandsustainablelandusehasledtococoadevelopmentcentres in Ivory Coast and the formation of a consortium ofprivate sector partners with the government of Ghana for acocoarehabilitationprogrammein2013.Thefocusongenderand food security in Ghana has led to women’s groups beingengagedinstaplecropfarming. Solidaridad has further strengthened its relationship withthe governments of Ghana, Nigeria and Ivory Coast. In Ghanathe second National Stakeholder conference took place withsupportfromcompaniesandCOCOBOD.TheNationalRefer-ence Group in Indonesia has developed a national standardand a platform for learning and exchange of information onsustainable cocoa production. In Vietnam the team playedan active role in the National Vietnam Cocoa Council anddevelopedtrainingtoolsandprogrammes.Theclosecollabo-ration with Mars in the Netherlands and West Africa led to adocumentary on sustainable cocoa on National Geographicchannel as part of the ‘For the love of chocolate’ campaign.Thiscampaignreachedatotalofalmost16millionpeopleandand an advertising value of €1.3 million. Solidaridad is part ofa consortium that is developing a European sustainabilitystandardforcocoa. Public-private partnerships made it possible to train morethan114,000farmersingoodagricultural,socialandenviron-mental practices. A programme on rehabilitation and cocoanurseries started in Ivory Coast and a consortium of compa-nies, CSOs and government was formed in Ghana for a large-scaleintensificationandrehabilitationprogrammein2013.

leSSonS learned

Building relationships with private sector partners takeslonger than expected. Developing consortia and proposalsfor rehabilitation and a social agenda also takes time, ascompanies tend to focus on short-term results. Expansion ofthe programme, especially training farmers in Asia and LatinAmerica,wasnotassuccessfulasanticipated.

PartnerShiPS With CoMPanieS

Solidaridad has formed new partnerships with many compa-niesforprogrammesinWestAfrica.TherelationshipwithMarshasbeenenhanced.Asoneofthebiggestchocolatebrandsintheworld,Marsisleadingnewthinkingoncocoasustainability.Programmes are being implemented in Ivory Coast and thecompany played an important role in strategy developmentfortheintensificationandrehabilitationprogrammeinGhana.The relationship with Cargill – one of the major global cocoabuyingandprocessingcompanies–developedfurtherin2012.This included a programme on rehabilitation in Ivory Coastand a large-scale training programme in Ghana. Solidaridadand Cargill have signed a long-term agreement and commis-sionedexternalimpactassessmentsinGhanaandIvoryCoast.

donorS

WorldCocoaFoundation(WCF)issupportingtheprogrammeonfoodsecurityinGhana.Numeroustradingcompanieshavepledgedlong-termsupportandlaythefoundationsforfurtherintensificationandrehabilitationintheyearsahead.

iMPaCt

AbaselineassessmentoftheprogrammeinGhanawasmadeby Wageningen University. Solidaridad and Cargill are doingthe same exercise in Ivory Coast, but the results are not yetavailable. For all projects Solidaridad made a baseline assess-ment and mid-term project evaluations. A study by KPMGbased on in-depth interviews with stakeholders measuredthe impact of the cocoa programme on market transforma-tion (2008-2012). The main results are that 151,000 farmerswere Utz certified and produced 414,000 tons of cocoa withan average 10% premium on prices. Stakeholders recogniseSolidaridad's important contribution to the debate, invest-mentsinthesectorandthemainstreamingofcertification.In2009around2%ofcocoaworldwidewascertified.Bytheendof 2012 Utz Certified alone covered 10% of the world cocoaproduction.


-

114,039 farmers are being supported in the cocoa sector

€ 8,000

€ 5,000

€ 40,000

409farmerssupported

109,630farmerssupported

€ 3,446,000

€ 106,000

MarketdevelopmentandcommunicationinGermany,theNetherlands,SwitzerlandandtheUnitedKingdom

YvoryCoast

Brazil

EcuadorGhana

Nigeria

Cameroon

Budget2012€ 2,488,000

Actual2012€ 3,625,000

Planned2013€ 3,651,000

Close collaboration with Mars led to a documentary on sustainable cocoa on national geographic channel as part of the ‘for the love of chocolate’ campaign.

Vietnam

Indonesia


€ 20,000


-

Fruit and vegetables

SuStainable juiCe and food SeCurity

in 2012 a strong partnership was established between solidaridad and Friesland Campina riedel (FCr), the market leader in fruit juices in the netherlands. solidaridad is supporting FCr in its ‘route 2020’ programme — moving towards 100 % sustainably sourced products.

the Context

The world’s fruit and vegetable sector is burdened by soildegradation and excessive water and pesticide use. Produc-tivity is low, and post harvest losses up to 40% are typical forthesector.Workingconditionsonplantationsareoftenpoor,and smallholders are vulnerable. Fruit and vegetable produc-tion in developing countries is not only important for export,butalsoforlocalfoodmarkets.Solidaridadpursuesstrategiesthatbuildonthesynergiesbetweenthosetwomarkets.

ProgreSS

The fruit & vegetable sector consists of many subsectors,each with its own characteristics and challenges. In 2012Solidaridad focused on fruit juice, bananas and food secu-rity. There are strong juice brands that are working towardssustainability. Bananas are the only fruit whose production isorganized through a round table: the World Banana Forum(WBF). Within the WBF Solidaridad works with leadingcompaniesinthebananasectorondevelopingapre-competi-tiveagendainordertoimprovethesustainabilityofthesector.MoreconcreteSolidaridadsupportstheWBFinsustainabilityinitiatives, a collaborative research agenda and in designing aweb-basedtoolforlearningandexchange.InPeruSolidaridadhas worked with 1700 producers to improve production andentrepreneurial skills. This has provided access to interna-tional markets, increasing farm incomes. Banana in Peru isproduced by small scale farmers (<1 ha.), which is exeptionalin the banana sector. The climate is favourable for organicbanana production, which is the market that Peru serves.Peruvian banana exports continue to increase strongly. InColombia,anationalsustainabletradeplatformisbeingorgan-ized to set joint priorities for improving the sustainability ofthesector.HalfoftheColombianbananasthatareRAcertifiedarenotsoldunderthislabel.Bystrengtheningmarketlinkageswithretailerstheplatformcanimprovetheshare. Fruitandvegetablesindevelopingcountriesarecrucialforthelocalfoodsupplyandonlyalimitedpercentageisexported.Solidaridadidentifiedthepotentialsynergybetweenmeetingdemand in export markets, generating cash, enabling invest-ments and improving the resilience of food production forlocal markets. Apart from the agricultural production Soli-daridad is identifying bottlenecks in local food distributionchainswithlocalpartners.Postharvestlossescanbereduceddramatically with relative simple measures. Food securityprogrammesincludingfruitandvegetableinKenyaandBang-ladeshareupandrunning,andthereispotentialformore.

integral aPProaCh

There is potential synergy in the production of cash cropssuch as coffee and local food production. Developing cashcrops enables farmers to invest in improving fruit and vege-table production for local consumption. Solidaridad devel-oped a proposal for this, together with private partners inKenya and Ethiopia. A key development was the roll out of aHorticulture and Food Security programme funded by theNetherlands Embassy in Kenya in which Solidaridad is theleading organisation (as part of a consortium involving Hivosand SNV). In November, Solidaridad received a grant of €12millionfromtheDutchembassyforthefour-yearSustainableagriculture Food security and Linkages programme (SaFaL).Thiswillhelp200,000smallholdersinSouthwestBangladeshadoptsustainablepracticesin dairyfarming,horticultureandaquaculture,whileimprovingfoodsecurity.

PartnerShiPS

Solidaridad has worked with Dutch organisations IDH andICCO to create a platform of Dutch companies in the fruitand vegetables sector. This resulted in the signing of a cove-nantforsustainablefruitandvegetables.Thecompaniesthatco-signedthecovenantcommittedtothegoalof100%certi-fiedsustainablevolumesin2020. Friesland Campina Riedel is taking a frontrunner role inorder to improve the sustainability in the fruit juice sector. Inthepast,thejuicesectorhasfocussedonthefruitprocessingindustry and not so much on the farmers that are deliveringthefruit.TogetherwithSolidaridadFCRisnowintegratingthefarmersintheirsustainabilityplans.

donorS

With support from Dutch Embassies Solidaridad developsnewprogrammesinanumberofcountries.InKenyaandBang-ladesh improved fruit and vegetables production and distri-bution are crucial to improve food security. In Colombia theprogrammesupportsthemovefromaidtotradeandincludesthe banana sector. In Colombia, the funding is designed tosupport a process of moving from aid to trade, in which foursectorsaretargeted,includingthebananasector. There is a clear commitment from FCR – and interest fromother juice companies – to work towards a sustainable juicesector. Supported by FCR Solidaridad analyses issues in thefruitsectorsofEcuador,Brazil,SouthAfricaandIndia.


-

4,536 farmers and workers are being supported in the fruit and vegetables sector

€ 4,000

€ 29,000



€ 1,066,000

€ 6,000

€ 2,000

MarketdevelopmentandcommunicationintheNetherlands

Peru

Colombia

Kenya

Budget2012€ 1,266,000

Actual2012€ 1,107,000

Planned2013€ 1,059

kenya. abishagy Wanjira Muriithi in front of her house. developing cash crops such as coffee enables farmers to invest in improving fruit and vegetable production for local consumption.



-

Cotton

better Cotton ProjeCtS haVe ViSible iMPaCt

For the last three years, solidaridad and its partners have been pioneering projects in india, China and mali under the better Cotton initiative (bCi). these are clearly improving farmers’ lives. as planned in 2011, better Cotton has now been licensed in China. and in 2012, a bCi project was developed in mozambique, a new country for solidaridad’s cotton programme.

groWing Well

About 80% of the world’s cotton farmers are smallholders;between them, they supply less than 50% of the world’scotton.Low,unstableincomespreventthemfrompayingoffthedebtstheyincurtomakenecessaryinvestmentsinseeds,fertilizers and pesticides. With support from Solidaridad andpartners, they can adopt more sustainable practices that willbring real personal and environmental improvements. Byprovidingaccesstoanorganisedmarket,thesepracticesalsobringthecashthatprovidesfarmersandtheirfamilieswithadignifiedliving. Against this background, it is therefore very satisfying toreport that progress in 2012 was much greater than antici-pated. Not only did Solidaridad projects attract a lot ofinterest from donors, there was additional investment frombrands and retailers. From 25 in 2011, the number of projectsgrew to 28 in 2012, including BCI as well as organic/FairTrade. They also had an internal momentum of their own: asfarmershadgoodresults,theyattractednewfarmersintotheprogramme. By the end of the year, more than 145,000 wereparticipating – up from 100,000 in 2011, which had originallybeenthetargetfor2015.Trulyavirtuouscircle! With the expansion of the ProCotton programme inUganda and a new BCI programme in Mozambique, Solidar-idad extended its cotton activities into East Africa. It is nowinvolvedincottonprogrammesinninecountries. Solidaridad’s Cotton Solution Network team for India hasbeen working on implementing Better Cotton since 2009.At the General Assembly of the BCI in Istanbul in July, it washonoured to win the ‘Proud to be an Implementing Partner’award for the clarity, impact and originality of two best-practice stories. Set in the tribal area of Orissa state, betterdecision-making and a change in attitude reflect some of theground-breaking changes farmers are making with the helpof Solidaridad’s local partner, Pratibha Syntex. In China, fourBCIprojectssuccessfullycompletedthequalificationprocessthatstartedin2011;allarenowlicensedtosellBetterCotton.

ChallengeS left

Apart from the volatility of the cotton market, the greatestdifficulties lie in connecting producers and buyers. Small-holder cotton projects are particularly affected by the sheercomplexity of supply chains and price negotiations: thereare too many players, too little transparency, and too littlecontrol. Seen from the farmers’ point of view, there’s a clear busi-

nesscaseforsustainablecotton,buttoosmallasupplytoturnit into a more mainstream product – which is essential. Seenfromamarketperspective,downwardpressureisneeded–tomobilise not only buyers, but also the ginners and spinners;and also to get commitment to longer-term relationshipsthroughoutthechain.


Solidaridad’s activities in the Better Cotton Fast TrackProgram (BCFTP) are supported by pioneering brands andretailers, such as Adidas, H&M, IKEA, LS&Co and M&S, withtheir publicly stated target of using 100% sustainable cottonintheirproductswithinthenextdecade.Inthis,theyactivelyinvolve their supply chain partners. In 2012, Bestseller part-neredwithSolidaridadasadirectinvestorinafarmprojectinIndia. A recent BCI member, Bestseller is the Danish holdingcompany of the Jack&Jones, VILA, Only and Vera Modabrands.

donorS

IDH(theDutchSustainableTradeInitiative)andtheRabobankFoundation are key partners in the BCFTP, a programmethat sets strategy to accelerate supply of Better Cotton andthat matches private-partner investments up to 100%. BCIfarm projects are also supported by the Farmer SupportProgramme, a four-year public-private partnership that willrun until 2015. Solidaridad’s ProCotton activities in EasternAfricaaresupportedbytheCommonFundforCommodities.

iMPaCt

Under the BCI, progress is currently being documented onseveralindictorsforallfarmersinvolved,suchasnetincome,reduced pesticide use and women involved. The data areverified, analysed and aggregated. Comparison with controlfarmers provides valuable information for assessing theimpactoftheprogrammes.ThroughthiswelearnedthatBCIfarmers in Mali have 8% higher profits than control farmers.In 2012 a short documentary was made in Mali, the intentionbeing to repeat the exercise a few times in order to demon-stratethatrealchangeistakingplace.

Progress in 2012 was much better than anticipated. from 25 in 2011, the number of projects grew to 28 in 2012.


-

SolidaridadtheNetherlandsinvestmentsmainlyrelatetoprogrammesinotherregions.

€ 7,000

€ 94,000

€ 200,000

€ 181,000

€ 11,000

€ 1,898,000

Brazil

Mali

Ghana

Zambia

Uganda

Tanzania

Kenya

Mozambique

Budget2012€ 1,396,000

Actual2012€ 2,391,000

Planned2013€ 4,115,000

Photo:JosKuklewski

China. temporary workers are transported by the guoxin – an export-oriented textile and garment company – to the farm. they start in august and will work until harvest is finshed at the end of november.

145,131 farmers are being supported in the cotton sector




50farmerssupported

41farmerssupported




-

textiles

all Set for a Major SCale-uP in 2013

the scene for larger environmental programmes in 2013 – involving 200 mills in bangladesh and 75 in China – was set by successful pilots with textile-dyeing, washing and finishing factories, resulting in impressive in water, energy and chemicals. in india, hennes & mauritz (h&m) partnered with solidaridad on a programme promoting the rights of garment-factory workers.

the benefitS of an integrated aPProaCh

From cotton to finished garment, the textile supply chainis characterised by various social and environmental chal-lenges. By training workers and helping factories implementstructural improvements, Solidaridad and its partners workto improve labour conditions, reduce pollution and improveefficiency.Andbyencouragingfashionbrandstobuysustain-ably produced textiles or actively engage with their existingsuppliers on making improvements, they also help improveconditions. In 2012 time was spent on programme design and in asuccessful search for partners. The pilots for the CleanerProduction programmes showed a clear business case forimplementingenvironmentalimprovements.Throughenergyand water savings, for example, considerable cost savingswill allow for investing in further social and environmentalimprovements – thereby benefitting workers, the environ-mentandcommunities. In Bangladesh, the Royal Dutch Embassy in Dhaka signed aMemorandumofUnderstandingwiththeIFC,Solidaridadandnine brands to scale up the programme from 2013. Roughlyhalf of the funding will come from public sources, notablythroughtheembassy,whichismatchedbytheprivatesector– to a large extent by brands and retailers, though partici-patingfactoriesalsocontribute. Last year’s factory fires in Bangladesh and Pakistanprovidedjustonereminderoftheimportanceofapproachesthat tackle root causes simultaneously – including worker-protection legislation, worker training, local government,buying practices, and the attitudes of factory management.Theneedtoraiseworkers’awarenessoftheirrightsunderlayfive short training films for garment workers in Bangalore,India,whichH&Mwasinstrumentalinmaking.Themovieswillberolledoutin2013.Filmedinfactoriesandfeaturingprofes-sional actors, they deal with health and safety; good workingenvironments; overtime; misconduct, abuse and grievance;andworkers’representation.Aswellasshowingthesolutionsto the problems it presents, each film shows how workerscan themselves take a solution-oriented approach to solvingthem.

leSSonS learned

It takes a long time to create multi-stakeholder partnerships– a particular problem in times of economic recession, whenbrands, retailers and factories are less able to invest. Despitethis, we believe that it was flexibility and an ability to balance

the interests of all stakeholders that enabled Solidaridad totest the approach developed in 2010-11 and to prepare it forupscalingin2013. In a similar vein, thanks to Solidaridad’s broad, integratedapproach to environmental sustainability, occupationalhealthandsafetyandlabourconditions,wehaveavoidedthetrapofslippingintothesingle-issuemanagementthatalltooeasily follows incidents such as the factory fires in Pakistanand Bangladesh. By consistently focusing on any issue in itswider context, we believe we’re creating a common groundforourvision.


The partnership with H&M has grown over the years – froma partner on small projects, the company has now becomea joint programme developer. As a front-runner in sustain-ability, it has also taken the lead in getting other brandsinvolved: Carrefour, S.Oliver, Tesco and Wal-Mart all joinedthe project for training videos in Indian garment factories.Similarly,C&A,G-Star,Inditex(theZaraparentcompany)andVFCorporation(LeeandWrangler)willmobilisesuppliersforcleanerproduction.

donorS

The Dutch Embassy in Dhaka, through the IFC, and privatecompanies are sharing the cost of the Bangladesh WaterPaCT, the Partnership for Cleaner Textiles. This four-year,US$ 11 million programme intends to raise awareness oncleaner production practices at 500 textile wet-processingfactories,andtoimplementbetterpracticesin200factories.Another donor is ASN Bank, whose support is woven intomany of Solidaridad’s social and environmental programmesin Bangladesh, China and India. With the financial support ofthe Ministry of VROM, brands and retailers as well as partici-pating factories, a successful Cleaner Production pilot wasconcludedinChina.

iMPaCt

The pilot projects with textile dyeing and finishing factorieswere an excellent test of our approach in China and Bang-ladesh. The China pilots averaged eight improvements perparticipant, and invested an average of almost € 25,000. Forexample one jeans manufacturer reduced steam consump-tionby25%andimproveditschemicalstorageandhandling.


-

7,600 workers are being supported in the textiles sector

€ 36,000

€ 441,000

MarketdevelopmentandcommunicationinBenelux,Germany,Scandinavia,Switzerland,UnitedKingdomandtheUSA

China

India Bangladesh

Budget2012€ 127,000

Actual2012€ 477,000

Planned2013€ 723,000

Photo:MariekeWeerdesteijn

the new PaCt programme delivers cleaner production in 200 textile factories in bangladesh.

SolidaridadtheNetherlandsinvestmentsmainlyrelatetoprogrammesinotherregions.

5,000workerssupported

2,600workerssupported


-

gold

riSing Profile for fairtrade gold

in may, the launch of Fairtrade and Fairmined (FtFm) gold in the netherlands was a successful awareness-raising campaign. less visible but no less important were the expansion of the FtFm programme to africa and a project in south america to test the FtFm standard in mining regions where forced labour is endemic.

Strong groWth

Solidaridadistheonlycivil-societyorganisationworkingwithpartners in both the industrial and small-scale mining supplychains to test new and better ways of mining. It is now capi-talising on jewellers’ increasing awareness of the widespreadsocialandenvironmentalharmlinkedtogold,suchasconflict,bondedlabour,unpaidchildlabourandmercurypoisoning. One measure of progress lies in the number of buyerslicensed to buy FTFM gold. In January 2012, the Netherlandshad none; by December it had nine. Thanks to a joint effortbetweenFairtradeInternational,theAllianceforResponsibleMining,Solidaridadandotherorganisations,theUK,theNeth-erlands and Denmark are now home to over sixty licensedbuyers. The challenge now is to get the message out to jewelleryconsumers that it’s vital to insist on responsible gold. TheDutch launch of FTFM gold, which at one point featured TVandcinemastarKatjaSchuurman,wasenormouslysuccessfulinthisregard.Mediacoveragereached80millionpeople.Theadvertising value of the free publicity was more then €2.3million. On prime-time TV news, the launch took third place,beaten only by the latest development in the Euro crisis andbytheFrenchpresidentialelections.Dutchlicenseesarenowreporting that consumers are increasingly seeking them outandwanttobuyFTFMgoldjewellery. The expansion of the implementation programme toGhana, Kenya, Tanzania and Uganda – where there is now fulltraining on the ground – meant that capacity training nowcovers seven countries on two continents. With the otherthree countries – Bolivia, Colombia and Peru – the totalnumberofminersassistedtodateisnearly5,000;communitymembersnumberalmost32,000. TheAfricanprogrammesareinthefirstphaseofanalysingcurrent practices and alerting miners to what they cando better. The focus for future years lies not just on effi-ciency, but also on helping mining associations to achievelegality under national legislation. Without it, these groupsof small-scale miners will not be able to qualify for FTFMcertification. While Solidaridad’s programme is growing very success-fully – in 2012, the groundwork was also laid for expansion toNicaraguaandArgentina–therealtestisthefutureuptakeofcertifiedFTFMgoldbycompanies,andofResponsibleJewel-leryCouncil(RJC)goldbytheindustrialsector.Activitiessuchas the successful Dutch launch are just one of many keys tothis.

leSSonS learned

After some setbacks, Solidaridad changed its procedure foridentifying industrial mining companies as potential part-ners. To connect with like-minded organisations, there arenow sessions on social responsibility at more internationalandregionalminingconferences.Thesemakeitmuchclearerwhich mining companies are ready to put leading ideas intopracticeandtoallowverificationthroughmodelssuchastheResponsibleJewelleryCouncil.


Dutch jewellery designer Bibi van der Velden is GoldProgramme ambassador. Together with Steltman Jewellers,the Dutch crown jeweller, she was a prime mover behind thelaunch in May. She has supported the campaign through herbracelet design, and, with Steltman, has produced a line ofjewelleryinFairtradeandFairminedgold.Steltman,whoalsocarry a version in certified gold of the bracelet Bibi designedfor Soldaridad, are raising awareness and pushing for betterpractices in small-scale mining communities. As a leaderamong Dutch companies, they hope to encourage otherjewellerydesigners,brandsandretailerstocomeonboard.

donorS

In testing innovative approaches to tough challenges in themining sector, Solidaridad needs visionary partners who arewilling to take risks. In a wider programme to test whether itcan be effective in stopping forced labour in mining commu-nities, Solidaridad is partnering with U.S.-based HumanityUnitedingold-producingregionswhereserioussocialabusessuch as forced labour, trafficking, prostitution and extortionareprevalent.Theproject–nowintheearlystages–hasiden-tifiedhigh-riskcommunitiesinPeruandColumbia.Supportisbadly needed there, but success is far from guaranteed andtheprojectisabigleapforbothpartners.

iMPaCt

Though the Gold Programme is still in its early stages, meas-uring impact is a key goal for the years ahead. In 2013 Soli-daridad will commission an external evaluation to measureprogress so far. Impact assessments are also scheduledand these will be useful for comparisons with baseline datacollectedin2009.


-

2,838 miners are being supported in the gold sector

€ 5,000

€ 59,000

€ 130,000

1,613minerssupported

500minerssupported

725minerssupported

€ 37,000

€ 101,000

MarketdevelopmentandcommunicationinDenmark,theNetherlands,SwitzerlandandetheUnitedKingdom

Colombia

Peru Brazil Tanzania

Uganda Kenya

Ghana

Budget2012€ 736,000

Actual2012€ 332,000

Planned2013€ 894,000

the focus in the african programmes is on efficiency and legalisation. Without a legal entity small-scale miners cannot qualify for ftfM certification.

Photo:AnnemariekevandenBroek


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soy

firSt ProjeCtS in China and MozaMbique

soy is a high-volume, low-margin product. global production increases by 7.5 % each year, mainly because of increasing demand for soy meal in China and its widespread use in animal feed. the impact on land use is considerable.

PrograMMe Setting

Planting more hectares with soy in South-America contrib-utes to destruction of precious rainforests, while heavy useofpesticidespollutessoilandgroundwater.FarmersinChina,India and Africa suffer from low productivity. Solidaridadpromotes use of scarce land in a smarter, more sustain-able way through training and by promoting Round Tableon Responsible Soy (RTRS) certification, especially in SouthAmerica.

ProgreSS

Solidaridadissupportingsoyfarmersinanincreasingnumberof countries in South America, Asia and Africa. For small-holders outside South America, who often get relativelylow yields, training in Good Agricultural Practices is likely toresult in higher productivity. South American soy producersare, however, often reluctant to get involved with RTRS,becausetheyarenotsurethattherewillbesufficientdemand(demandforRTRScertifiedsoyisincreasingrelativelyslowly).In South America, where there are very large farms and highproductivity, almost 300,000 hectares of soy farming wascontracted by Solidaridad for the IDH Soy Fast Track Fund in2012,creatingasupplyofresponsiblesoy.

iMProVing agriCultural PraCtiCeS

Akeyissueincertificationisavoidingdeforestationbylinkingfarmerstopremiumbuyerswhomakethisaspectmandatoryas part of the RTRS standard. In general, in South AmericaSolidaridadaimstoreducenegativeimpacts,whileintherestoftheworldit’smoreaboutimprovingyieldsinasustainableway. Outside South America the RTRS standard can be used asa reference. In India and Africa (e.g. Mozambique) farms aremuch smaller and yields are low. Solidaridad has supportedtraining of 30,000 small-scale soy farmers in India (averagefarm size: just over 1 hectare) in improving agricultural prac-tices.Thishasledto15-20%higherproductivityandimprovedlivelihoods. In 2012 the first Solidaridad soy programme in Africa wasstarted in Mozambique in a cooperative venture with theNGO Technoserve. Over the next three years 25,000 small-holderfarmerswillbetrainedinbettermanagement, leadingtohigherproductivityandimprovedsoilconservation.

breakthrough in reSPonSible Soy in China

China is the single largest consumer and importer of soy inthe world as well as the fourth largest producer. In a countrywhere non-governmental organisations have little influence,achieving higher benefits for farmers with reduced envi-ronmental impact is challenging. Two large farms will startworking together with Solidaridad towards the first respon-sibly produced soy in China. The programme focuses ontwo key challenges: reducing poverty amongst soy farmers,whose annual income is less than €150 from soy plantation,andonreducingtheuseofchemicals.In2015theprogrammeisexpectedtoresultina10%reductionofcostsduetolowerinputs, a better market price as a result of the introductionof better soy varieties, a 10% increase in turnover per farmthroughhighercropqualityand20%higherincomesforlocalsmallholders.


Demand for responsible soy lags behind expectations. Notbeingaconsumerproduct,companiesneedtobeconvincedoftheadvantageofinvestinginsustainabilityandSolidaridadis actively working on that. In the Netherlands – the secondlargest importer worldwide – there is a collective agreementamong all companies in the animal production sector thatall soy used in the Netherlands should be RTRS certified orequivalent. Dairy company FrieslandCampina has supportedSolidaridad soy programme activities in Brazil and India forfour years now and is one of the key players in the transitiontowards 100% RTRS soy imported into the Netherlands.CONOisasmalldairycompany(supplyingBen&Jerry’s)andcheese maker, but a frontrunner in supporting SolidaridadfarmsupportprogrammesinIndia.

iMPaCt

Family farmers in Brazil and in India have been supported intheir attempts to improve production, while complying withtheprinciplesandcriteriaofRTRS.InIndiathishasresultedinan increase in yield with fewer inputs, thus reducing poverty.In Brazil the main impact has been more balanced use ofinputs.ThetrendisforthebiggestbrandsandretailersontheglobetocommitthemselvestosustainabilityandSolidaridadis well placed to deliver services to stakeholders throughoutthe soy value chain. An external impact study of the Indiasoy programme started at the end of 2012 and results areexpectedinMay2013.


Soy

-

40,240 farmers and workers are being supported in the soy sector

€ 1,334,000




€ 40,000

€ 119,000

€ 213,000

MarketdevelopmentandcommunicationinBelgium,France,Germany,theNetherlands,Scandinavia,SwitzerlandandtheUnitedKingdom

Bolivia

Paraguay

Argentina

India

China

Brazil

Budget2012€ 2,226,000

Actual2012€ 1,706,000

Planned2013€ 1,243,000

Pesticide spraying by a small scale farmer in a large soy growing area. Promoting integrated crop management and reducing the environmental impacts of pesticide use are key issues in the Solidaridad China programme.

SolidaridadtheNetherlandsinvestmentsincludeprogrammesinotherregions.

SolidaridadSouthAmericainvestmentsincludeprogrammesinotherregions.


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Palm oil

global PrograMMe StartS to bear fruit

Partnerships with main market players in the sector have resulted in a range of projects that started in 2012. such programmes include better management practices, pilots, working towards standard compliance and market access for smallholders. a highlight was the launch of the sustainable west african Palm-oil Programme.

PrograMMe Setting

PalmoilhasbroughtimpressivewealthtoIndonesia,Malaysiaand other tropical countries. However, it is also associatedwith negative impacts, such as deforestation and the exploi-tationoflabour.TheRoundtableonSustainablePalmOilwasset up to address these and other issues, but the standard isnoteasyformanysmallercompaniesandsmallholderfarmerstocomplywith.TheSolidaridadpalm-oilprogrammefocuseson making the palm-oil trade more inclusive and sustain-able: ensuring that smallholders and labourers benefit, whilereducing the sector’s negative impact on people and nature.Theshiftfromabuyers’toasellers’marketinthepastdecadeand the dominance of Asian consumer markets requires aspecialfocusonAsia.

Strategy

In producing countries, Solidaridad develops model projectsthat put farmers’ benefits first and works towards certifica-tion where there is a clear business case. In the supply chain,theideaistoworkwithmills,tradersandconsumerbrandstoget smallholders included in supply chains of leading compa-nies and to establish direct links through certificate tradewherever possible. Solidaridad operates both within andoutsideofRSPOtoestablishinclusivevoluntarysustainabilityguidelines and works to ensure that RSPO and other stand-ards are credible by ensuring they deliver on their promise.Solidaridad also collaborates with civil society organisationsand government agencies to create a level playing field andultimatelymakesustainableproductionandtradethenorm.

ProgreSS

As part of the new Sustainable West African Palm-oilProgramme Solidaridad is working with Unilever to integratesmallholders in the supply chain by helping them to producemore sustainably so that the region can become more self-sufficient in palm oil. Preliminary results of the global farmersupport programme are promising, with increasing yieldsand improved supply chain relations in pilot projects in LatinAmerica,Africa,andAsia.BeyondpilotsSolidaridadandRSPOsupport the scaling up of sustainable palm oil production inColombiaandHondurasincollaborationwith13localplanta-tioncompanies,industryassociationsandleadingprocessorsofpalmoilsuchasHenkelandJohnson&Johnson.

leSSonS learned

Although there is a specific smallholder standard, the RSPOcode often inhibits certification of smallholders, even if theirsocial and environmental impact is in line with the spirit ofRSPO. By participating in the RSPO’s Principles and Criteriareview and the Smallholder Task Force, there is an opportu-nitytoimproveRSPOinstrumentsdesignedtoincreasesmall-holder benefits. For lasting improvement, massive invest-ment in replanting of smallholdings and African plantationsisneeded.Thisrequiresaconcertedeffortfromtheindustry,producersandfinancialinstitutions.


Partnerships have been developed with global companiessuch as Unilever, training and knowledge institutions suchas LPP and IOPRI in Indonesia and engagement in initiativessuchasRT-REDD(buildingbridgesbetweenRoundtablesandthe REDD+ avoided deforestation programme) and SHARP(a partnership designed to improve livelihoods and reducedeforestation). Such partnerships enable Solidaridad toleverageitslimitedresources. Johnson & Johnson, Cono Kaasmakers and Ben & Jerry’ssupport the production of sustainable palm oil through thepurchase of Green Palm RSPO certificates which benefitcertified sustainable growers and through dedicated small-holder projects in Indonesia, Malaysia and Ghana. In Asia,Solidaridad partners Wild Asia and Verité have shown thatworkers’ concerns (a living wage, health and safety, rights ofassociation, and more bargaining power) need more atten-tionbothinsideandoutsideRSPO.

iMPaCt

The palm-oil programme is relatively new; an evaluation ofthe 2010-2012 programme will be published in 2013. Pilotprojects report significant improvements, even at this stage:for example, the 54 longhouse-dwelling Iban families thatparticipated in an RSPO pilot with Keresa plantations estab-lishedlong-termcontractswithmillsandincreasedtheirsalesfrom 2,100 tons in 2010 to almost 4,400 tons in 2012. Yieldincreasesofabout20%havebeenreportedasaresultoftheadoptionofbettermanagementpractices.


-

21,311 farmers and workers are being supported in the palm-oil sector

€ 20,000

€ 179,000


1,912farmersandworkerssupported*


3,118producerssupported

12,574producerssupported*

€ 784,000

€ 231,000

Colombia

Brazil

Honduras

Ghana

Nigeria

IvoryCoast

MarketdevelopmentandcommunicationinGermany,theNetherlands,UnitedKingdomandtheUSA

Indonesia

* Honduras,ColombiaandBrazilimplementedprojectswithfundsreceivedin2011.IndonesiaandMalaysiaprojectswerefundedbySolidaridadtheNetherlands.

Budget2012€ 1,187,000

Actual2012€ 1,214,000

Planned2013€ 4,095,000

“i really appreciate the farmer field school. for the first time, we have been given information about how the mill sorts and grades... We have a manual, photos and real examples of good quality oil palm fruit.” AnindependentsmallholderattendingtheSolidaridadFarmerFieldSchoolinSekadau,WestKalimantan


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sugar Cane

iMPortant SteP aS ethanol reaCheS euroPe

in 2012, argos energies, a dutch importer, bought the first-ever shipment of traceable bonsucro-certified ethanol from brazil, thus achieving an ambition set at the start of the programme in 2009. this represents enormous progress: just three years ago it would have been impossible even to certify sugar cane.

Sugar-Cane PrograMMe CoMing of age

Sugarcanehasahugepotentialforreplacingpetroleumasthekey ingredient for many fuels and materials. But to achieve itsfull potential, the industry needs to leave its negative historybehind–adarkpastoflabour-rightsabuses,povertyandenvi-ronmentaldamage.Toalleviatepoverty,farmerscanachieveagreat deal through better productivity – of labour, soil, waterand other inputs. Solidaridad’s support is designed to findways in which famers, other supply-chain partners and civil-societystakeholderscanworktowardsthiscommongoal. Argos’purchaseofBonsucro-certifiedethanolshowedthatthe sugar-cane programme is coming of age. In 2012, Solidar-idad was involved in sugar-cane programmes in 11 countriesworldwide, and had become a recognized and valued partnerfor working with industry, government and other stake-holders. A cornerstone of its work is the project with Argos,which made it possible to identify a mill, work on a pilot, andfindasuppliertobuildaBonsucrochainofcustody–thefirstfromBraziltoEurope.Thisprocesswasveryinstructiveforallconcernedandhasproducedexcellentresults. Asanotheraspectofthiswork,Solidaridadanditspartnershave worked to develop tools for farmer support. These arebased on similar principles around the world, but are alwaysspecific to local farmers’ circumstances and experience.They enable famers and millers to assess their performancein business terms, and also in terms of its social and environ-mental impact. Performance gaps can be identified, and thenclosed through training and practical advice. These tools areattracting the attention of farmers’ organisations, mills andgovernment extension services. In the years ahead, we areconfidenttheywilldrivefurtherprogress. In 2012, Solidaridad’s activities were extended to three newcountries – Tanzania, Swaziland and Malawi – and also gainedgreater focus and consistency. Better understanding of thesector showed how to use our very modest means to makea real difference. Successful pilots spawn imitators, made itpossible to move up the supply chain, attracting millers andindustry organisations. In Bolivia, such an approach helped alargemill–afarmerandworker-ownedco-operative–touniteforcesandreducechildlabourby80%relativeto2011.

the MillS are the key to iMProVeMent

Large end-users have been hesitant about getting engaged,mainly because the sugar market is mature and well estab-lished, involvesahighlystandardisedproduct,andisprimarilyprice-driven. And with a growing palette of competing sweet-

enerstochoosefrom,sugarisstrategicallylessimportantthancommodities such as coffee, cocoa or fruit, which cannot bereplacedbyalternatives. In most cases, Solidaridad has therefore gone straight tothe sugar-cane mills – the link in the supply-chain whose pastinvestments give them the greatest interest in better caneproduction. Each of the six new sugar-cane projects startedin 2012 – in Brazil, Mexico, Africa and India – had at least onemillasapartner.Recognisingtheimportanceofsuchprojects,end-users are now indicating a willingness to treat these millsaspreferredsuppliers.


The world’s largest ethanol producer, Raízen – a joint venturebetweenShellandCosan–hassetitselftime-boundtargetstocertifyallofitsoperationstoBonsucrostandards.Over4,000outgrowerfarmerswillbeincluded.InBrazil,RaízenandSolidar-idad have developed a self-assessment system for sugar-canefarmers. This helps them to make improvements in the field,if necessary with aid from the mills or farmers’ associations. International Finance Corporation (IFC; part of the WorldBank Group) and Solidaridad South & Southeast Asia joinedforces in five Indian states to help 14 sugar mills and thefarmerswhosupplythemtoimprovetheirsugar-canecultiva-tionandmillingpractices.FourmillsandtheirfarmerswillseekBonsucrocertificationbefore2015.

donorS

Through the Farmer Support Programme, the NetherlandsMinistry of Foreign Affairs supported projects in eight coun-tries,aswellasworkonmarkettransformationandthedevel-opmentofplatformssuchasBonsucro. Through the Global Sustainable Biomass Fund, Agency NLsupported pioneering work on the certification of a mill inBrazil, bringing certified ethanol to Europe for the first time,retraining expelled cane cutters – especially women andpeople with a low education – and developing a self-assess-menttooltogetherwithRaízen.

iMPaCt

Although no impact studies on the sugar-cane programmewereconductedin2012,andnonewereprepared,Solidaridadworkedwithsome35,000farmersworldwidetoimprovetheirpractices and incomes. Project-based monitoring indicatesthat productivity increases and input-cost savings raised netincomesacrosstheboardbybetween10and15%.


-

51,756 farmers and workers are being supported in the sugar-cane sector

€ 579,000

€ 19,000





€ 160,000

€ 165,000

€ 54,000

Brazil

BelizeHonduras

Bolivia

Paraguay

Argentina

Tanzania

MalawiMozambique

Zambia

Swaziland

India

Budget2012€ 1,095,000

Actual2012€ 977,000

Planned2013€ 1,440,000

the sugar-cane industry needs to leave its negative history behind it – a dark past of labour-rights abuses, poverty and environmental damage.

Photo:PietdenBlanken

MarketdevelopmentandcommunicationinGermany,theNetherlands,Scandinavia,SwitzerlandandtheUnitedKingdom

SolidaridadtheNetherlandsinvestmentsincludeprogrammesinotherregions.

SolidaridadSouthAmericainvestmentsincludeprogrammesinotherregions.


-

livestoCK

firSt aCtiVitieS in the liVeStoCk PrograMMe

in 2012 the first concrete activities in the livestock programme got underway, including a project in eastern xingu basin in brazil for smallholders, which focuses on the management of beef herds and improving the livelihoods of indigenous people.

the Context

The livestock sector meets a significant proportion of globalprotein requirements, but the social and environmentalimpacts can be considerable. Improved management canreverse land degradation and increase productivity and effi-ciency, thus reducing environmental pressure while feedingmore people. The sector is significant worldwide, both intermsoflanduseandlivelihoods.

ProgreSS

The focus within the programme is currently mainly on beef,but dairy will be included, also because of the interrelation-ship. Solidaridad contributed to the Global Roundtable onSustainableBeef,whichwasformallylaunchedin2012andsetupaworkinggroupwithConsumerGoodsForumtosupportthe goal of zero net deforestation. The first Solidaridad live-stockprojectstartedinBrazil–incooperationwithAliançadaTerra – and projects in Uruguay, Paraguay, Brazil and variouscountriesinAfricaarebeingprepared. Attempts to get European retailers involved in enhancingthe sustainability of beef production in South America andAfrica – either by investing in producer support or throughcertification – have not yet been successful. This is partlybecause consumer pressure is stronger for other types ofmeatandthefactthatrelativelylittlebeefisimported.

the xingu ProjeCt

In a settlement in one of the poorest municipalities of theEastern Xingu in Mato Grosso, Brazil, this project is using thebeefmarkettosupportmorethan300families.Inthiscoop-erationwithSolidaridad,AliançadaTerra(LandAlliance),hasartificially inseminated 500 head of cattle with high-qualitysemen and plans to inseminate more than 25,000 during thelife of the project. Community associations have been estab-lishedandtechnicalassistanceisbeingprovided.Mostimpor-tantly, they are beginning to negotiate joint sales to generatea higher price for their animals. This partnership is leadingthewayforothersmall-scaleproducersinBrazilandpossiblyabroad.PriVate SeCtor PartnerShiP

Zandbergen World’s Finest Meat is one of the largestimporters of beef in Europe, selling beef to retailers in manyEuropean countries. They import from all over the world,including from Uruguay, Brazil, and Namibia, where Solidar-idad is setting up programmes. There is a Memo of Under-

standing with Zandbergen for cooperation on promotingsocial and environmental sustainability in beef productionand they are also a partner in a programme in preparation inUruguay.ThemaindonorforlivestockprojectsistheFarmerSupportProgramme,whichisfundedbyDGIS.

iMPaCt

Solidaridad is focusing on continuous improvements atthe farm level. At least six programmes will begin in 2013, inCentralandSouthAmericaandAfrica,involvingmulti-millionbudgets.

Solidaridad contributed to the global roundtable on Sustainable beef, which was formally launched in 2012, and set up a working group with Consumer goods forum to support the goal of zero net deforestation.


-

300 farmers and workers are being supported in the livestock sector

€ 103,000

300producerssupported

€ 35,000

Paraguay

Brazil

Uruguay

MarketdevelopmentandcommunicationinGermany,theNetherlands,ScandinaviaandtheUnitedKingdom

Budget2012€ 492,000

Actual2012€ 138,000

Planned2013€ 239,000

Mato grosso, brazil. the first Solidaridad livestock project started in brazil – in cooperation with aliança da terra – and projects in uruguay, Paraguay, brazil and various countries in africa are being prepared.

Photo:PieterSijbrandij

44 TheSolidaridad2012annualreportPhoto:KekeKeukelaar


regional deVeloPMent

• netWork finanCe

the Solidaridad network gains strength

• Solidaridad South aMeriCa

rural horizons, a new solution for farmers

• Solidaridad andeS

Creating platforms for sustainable trade

• Solidaridad Central aMeriCa

roundtables take hold in the region

• Solidaridad WeSt afriCa

Smallholder palm oil for local market

• Solidaridad Southern afriCa

forming partnerships across the region

• Solidaridad eaStern and Central afriCa

from subsistence to commercial farming

• Solidaridad South an South-eaSt aSia

food security programme in bangladesh

• Solidaridad China

intervention starts with farmers’ ambition

• Solidaridad the netherlandS

Campaigns raise Solidaridad’s profile

• Solidaridad north aMeriCa

new regional office in San francisco


networK FinanCe

the Solidaridad netWork gainS Strength

the growth of the solidaridad network is reflected in increased income, investments and personnel. this chapter opens with a global overview of these key figures for the network, followed by comprehensive reports on the organisational development of all solidaridad regional expertise centres.

In2012,SolidaridadNetwork’sincomewas€26.9million.ThiswasraisedmainlybySolidaridadtheNetherlands(€19million),buttheotherorganisationshavestartedtocontributeinasignificantway(€7.9million)andtheforecastshowsanincreaseinfundraisingthroughoutthenetwork.

Investmentsinsustainablevaluechainsamountedto€23.4millionin2012.€16.9millionwasdirectlyinvestedincommodityprogrammes;€4.1millionwasinvestedinpersonnel.Around50%ofthepersonnelcosts(€2.1million)relatetoSolidaridadtheNetherlands;muchoftheremainingpersonnelbudget(€1.9million)goestolocalprogrammemanagers,whomanageandsupportprojectsinthefield.Othercosts(€1.8million)aremainly(61%)investmentsbytheDutchofficeincommunication,travelandofficecosts.

ThetotalworkforceoftheSolidaridadnetwork(employeesandlong-termcontractors)consistedofthefull-timeequivalent(FTE)of188employees(2011:124).Thisincrease(52%)reflectstherapidgrowthoftheNetworkin2012.*

income from own fundraising Personnel (in fte)*secretariatNetherlandsChinaSoutheast AdiaEast&central AfricaSouthern AfrWest AfrCAMAndesSAM East&central AfricaSouthern AfrWest AfrCAMAndesSAM

0

2000

4000

6000

8000

10000


0

1000

2000

3000

4000

5000


CocoaTeaCoffee




Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Budget 2012

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013


0

2000

4000

6000

8000

10000


0

1000

2000

3000

4000

5000


CocoaTeaCoffee




Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Budget 2012

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

SolidaridadSouthAmerica 3,207,000 13.5

SolidaridadAndes 305,000 26.0

SolidaridadCentralAmerica 0 22.2

SolidaridadWestAfrica 3,013,000 47.0

SolidaridadSouthernAfrica 0 9.0

SolidaridadEasternandCentralAfrica 956,000 12.0

SolidaridadSouthandSouth-EastAsia 118,000 19.0

SolidaridadChina 0 9.0

SolidaridadtheNetherlands 19,048,000 30.7

Other 292,000 1.6

actual 2012 €�26,938,000 190.0

*Totalpersonnel(FTE,employedandfreelance)31December2012

Solidaridad netWork



SolidaridadAndes






SolidaridadChina

SolidaridadtheNether-lands

SolidaridadNetworksecretariat

total

Coffee 29,000 221,000 181,000 1,381,000 31,000 426,000 2,269,000

Tea 107,000 71,000 129,000 138,000 67,000 80,000 592,000

Cocoa 8,000 5,000 40,000 3,446,000 20,000 106,000 3,625,000

Fruitandvegetables 4,000 29,000 6,000 1,066,000 2,000 1,107,000

Cotton 94,000 200,000 7,000 11,000 181,000 1,898,000 2,391,000

Textiles 36,000 441,000 477,000

Gold 5,000 59,000 130,000 37,000 101,000 332,000

Soy 1,334,000 119,000 40,000 213,000 1,706,000

Palmoil 179,000 20,000 784,000 231,000 1,214,000

Sugarcane 579,000 160,000 19,000 165,000 54,000 977,000

Livestock 103,000 35,000 138,000

Other 424,000 19,000 15,000 111,000 32,000 24,000 1,462,000 2.086,000

total programme investments

2,772,000 353,000 221,000 4,475,000 542,000 2,671,000 544,000 287,000 5,049,000 16,914,000

�

HRM 143,000 403,000 151,000 469,000 190,000 201,000 133,000 153,000 2,118,000 184,000 4.146,000

Officeandothercosts 125,000 94,000 47,000 156,000 78,000 86,000 51,000 41,000 1,116,000 522,000 2,316,000

actual 2012 3,040,000 850,000 420,000 5,100,000 810,000 2,958,000 728,000 481,000 8,283,000 706,000 23,376,000

*SolidaridadtheNetherlandsfiguresexcludecontributionsbytheNetherlandstootherSolidaridadexpertisecentres

the Solidaridad netWork finanCial oVerVieW

BecausetheSolidaridadnetworkisnotstructuredasatraditionalgroupentitywithaparentcompanyandsubsidiaries,itdoesnotprepareconsolidatedaccounts.However,thefiguresbelow,whichrepresentinvestmentsinprogrammes,havebeenremovedfromthefinancialflowsoffundsbetweenSolidaridadregionalorganisations.

ThefourbiggestoftheseareSolidaridadtheNetherlands,SolidaridadWestAfrica,SolidaridadSouthAmerica,andSolidaridadEasternandCentralAfrica.Thesefourorganisationsarealsothemostmatureones,withahighlevelofinternalcontrolsinplace.In2013thefocuswillshifttostrengtheningtheothernetworkorganisationsfromthispointofviewandaligningcosts-fundraisingratios.

ThereisasignificantdifferenceintheratioofHRcoststototalcostsamongthenineorganisationsinthenetwork.Thisisduetothewaytheseorganisationsmanageprojects:somehireexternalprojectimplementers,whileothershireemployees,whichresultsinrelativelyhighHRcosts.Thesedifferentapproachesoftendependonlegalrequirementsandonwhatiscommonpracticeinacountryorregion.

Solidaridad netWork


0

2000

4000

6000

8000

10000


0

1000

2000

3000

4000

5000


CocoaTeaCoffee




Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Budget 2012

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

Budget 2012

Actual 20

12

Planned 2013

total actual 2012 of the Solidaridad network per region.

48 TheSolidaridad2012annualreport48 TheSolidaridad2012annualreport

solidaridad south ameriCa

rural horizonS, a neW Solution for farMerS

the rural horizons producer support and loyalty programme is an integrated software solution that offers farmers a self-assessment tool which they can use to measure their sustainability in terms of law, certification schemes and performance. rural horizons also provides farmers support with certification, finding a market for their produce and to minimize costs.

regional Market deVeloPMentS

Solidaridad South America intends to use the Rio OlympicGames in 2016 to promote sustainability by linking up withthemainsponsors.Thefocusisonsugar-canebrands.In2012an important step forward was the implementation of RuralHorizonswith256producersand17sugarmillsownedbytheCosan-Shell Joint Venture Raízen, the largest sugar consor-tiumintheworld.In2013,another3600farmerswilljoin.Theprovisional results were presented by Solidaridad and RaízenattheannualgeneralmeetingofBonsucroinLondon.

ConCePt deVeloPMent

Rural Horizons involves a four-step approach. It supportsfarmerswithselfassessment–makinggapanalysesinrelationtomandatorylegalaswellasvoluntarystandards.Acomput-erised database will provide a rich centre of know-how andexpertise. First tests are underway with cotton, livestock andsoy.Forthesecommodities,legalcomplianceisthechallenge.For tea and cacao, it is more about certification and marketdemand. Rural Horizons can become a global tool for Soli-daridad. First farmers assess the sustainability of their produc-tion systems. They answer questions on farm management,agricultural practices, protecting natural resources, labourconditions, and the health and safety of rural workers. Theseare used to generate roadmaps and farmers measure theirperformanceagainstbenchmarksaswellassetprioritiesandcreateactionsplans.

Most work takes place through commodity Roundtables,starting with initiatives designed to eradicate bonded labour,childlabour,discriminationandillegaldeforestation.Thefirstaim of all Roundtables is to move towards legal compliance.The next step is to establish the voluntary elements of thestandards,andgetthesecertifiedinthird-partyaudits.Finally,there are initiatives for moving towards integrated manage-ment, including cross-cutting tools such as REDD+ (tacklingdeforestation)andsustainablelandscapes.

CroSS-Cutting theMe: SuStainable landSCaPeS

There are increasing numbers of requests for support withmultiple commodity (sugar cane/soy, soy/cotton and beef/soy) and multiple standard certification (e.g. ISCC/RTRS/Bonsucro/GRSB).Thereisconsiderablepotentialtodevelop‘landscapes of excellence’, including multi-commodity, multi-buyer, multi-tool matrix interventions. These take place inselected focus regions on-farm, off-farm, and in an enablingpoliticalenvironment.

organiSational deVeloPMentS

In 2012, the South America team was strengthened in orderto manage Result-Based Management (RBM), Promis, theregional website and support further development of theRural Horizons tool and database/website. RBM is used toprovide evidence of positive impacts on people, society andtheenvironmenttofivelargegovernmentaldonoragencies.

Personnel Solidaridad South america in fte

to contact Solidaridad South america go to solidaridadnetwork.org/southamerica

Coffee 29,000 Tea 107,000 Cocoa 8,000 Fruitandvegetables 4,000 Gold 5,000 Soy 1,334,000 Palmoil 179,000 Sugarcane 579,000 Livestock 103,000 Other 424,000

Totalprogrammeinvestments € 2,772,000

Programmeinvestments 2,772,000 HRM 143,000* Officeandothercosts 125,000

actual 2012� €�3,040,000

2010� 2011� 2012�

4� 8� 13,5

* Morecostsfor(freelance)personnelareincludedintheprogrammeexpenses.Totalamountsto€580,000.

Not commodity speci�cAquacultureLivestockSugar canePalm oilSoyGoldTextilesCottonFruit and vegetablesCocoaTeaCo�ee

South America Andes Central America West Africa South Africa East and central Africa East South and South East Asia China Netherlands

O�ce and other costsHRMprogrammes


East and Central AfricaSouth AfricaWest AfricaCentral AmericaAndesSouth America






TheSolidaridad2012annualreport 49 TheSolidaridad2012annualreport 49

solidaridad andes

Creating PlatforMS for SuStainable trade

in 2012 platforms were launched for trading sustainably in coffee, bananas and flowers in Colombia and bananas in Peru. in June, Colombia’s minister of agriculture, the dutch minister for international Cooperation and the heads of the trading & Producers associations signed public declarations in support of sustainable production and trade, setting development targets for 2015.

regional netWork

In this region it’s all about exports. Solidaridad supportsmulti-stakeholder platforms. In Colombia, local associa-tions of producers help convene the main stakeholders andSolidaridad is in charge of the technical secretariat for eachplatform.Thisroleincludesusingitsexpertiseincommercialmatchmaking, developing sustainable trade in internationalmarkets and helping stakeholders to organize public-privatepartnerships. After almost three years of technology adaptation andfurther adoption for coffee rehabilitation, the coffeeproducers in San Martin, Peru have achieved significantincreases in yields and income. This process was facilitatedby Solidaridad. Local coffee promoters play a similar rolein a project in Antioquia, Colombia. A technology recipe isnot generally copy-pasted from one region to another, butfarmers can learn a great deal about how they can becomemoreproductive. CENBANOR,asecondlevelassociationofbananaproducersstarted the direct export of organic and fairtrade bananasto European markets in 2012. For a decade, Solidaridad hassupported the conversion of individual banana growers intoorganized associations capable of managing the commercialoperationofgettingorganicandfairtradebananasfromfarmto port. In 2012 Solidaridad started moving to the next level:supportingalocalplatformwithconveningbananaproducerassociations, companies, CSOs and government entities inordertoremovethemainbarrierstosustainability.

Work on responsible gold with artisanal miners is new forSolidaridad. In developing fairtrade certified gold mining it’simportant to assemble the appropriate logistics from themine to gold ready for export, identifying pioneers as certi-fied suppliers of fairtrade gold. The knowledge and exper-tise of local partner CSO Red Social – as well as that of moreadvancedminers–isfundamentalhere.

CroSS-Cutting theMe

In three programmes (coffee, fruit and gold) training toolsand methods are being adapted and implemented throughintra-learning, for instance adapting what works amongcoffee producers for the banana sector. E-training tools andbetterprintedmaterialsaregoodexamplesofthisapproach.

organiSation

In 2012 the former financial controller replaced the generalaccountant as Financial Manager. A new post has beencreated: Communications and Administration Manager,who also handles PME and PROMIS. In 2012 the ProgrammeManager for gold was responsible for the new agri-commodityprogramme.ThenewSustainableTradePlatformprogramme in Colombia will require the recruitment of fivefull-timepeoplein2013.

Personnel Solidaridad andes in fte

to contact Solidaridad andes go to solidaridadnetwork.org/andes

Coffee 221,000 Cocoa 5,000 Fruitandvegetables 29,000 Gold 59,000 Palmoil 20,000 Other 19,000

Totalprogrammeinvestments € 353,000

Programmeinvestments 353,000 HRM 403,000 Officeandothercosts 94,000

actual 2012� €�850,000

2010� 2011� 2012�

12� 25� 26












solidaridad Central ameriCa

roundtableS take hold in the region

in 2012 solidaridad moved from pilot projects in rsPo and bonsucro certification to developing a strong regional presence as the leading organisation for implementing sustainable agriculture, environmental and social practices in the palm-oil and sugar-cane sectors. one project alone will involve over 80 % of the honduran palm-oil sector adopting sustainable practices.

regional netWork

Solidaridad Central America is creating a unique sectoral-wide business approach for environmental, agricultural andsocial sustainability that is unlike anything else in the region.Dynamic and highly participatory consortia that mirrorthe role and function of the Roundtables on a global scalehave formed, facilitating rapid transformation, continuousdialogueandinvestmentopportunitiesforlong-termgrowthand performance. The main partners in our work includeWWF for agricultural innovation, SNV for inclusive businesspracticesandILO/SIMAPROMexicoforsocialissues.

Market deVeloPMent

The Program of Sustainable Quality (PROCASO) matured in2012 from a donor-supported technical assistance branchof Solidaridad, into a fee-for-service organisation that worksdirectlywithcoffeeexportersinthecertificationandprofes-sionalization of their supply chains. With demand for diver-sification and adaptation increasing regionally, PROCASOis expected to diversify their portfolio to include cocoa in2013,andothercommoditiesasopportunitiesarise.Solidari-dad’s visibility in Central America has increased significantlythroughparticipationinindustryeventsandtheinvolvementofmulti-nationalsinnationalcommodity-focusedconsortia.

CroSS-Cutting theMeS

In2012theseedswereplantedforfutureeffortsinrelationtochildlabourandworker’srightsinboththepalm-oilandsugar-

cane sectors, amid ongoing efforts in Smart and SustainableLand Use. The devastating coffee leaf rust outbreak in theregion is creating opportunities for crop diversification andadaptation related to Climate Smart Agriculture, as well as arenewed focus on food security for vulnerable families whoare struggling to stay on their farms as coffee productivitydrops.

organiSation

Under new leadership, Solidaridad Central America hasinstalled internal management and communication systemsthat are harmonized with the entire Solidaridad Network.Long-term partnerships that have been strengthened as wellas new ones are making Solidaridad a cutting-edge organisa-tionfortransformationintheregion.

Coffee 181,000 Cocoa 40,000



actual 2012� €�420,000

Personnel Solidaridad Central america in fte

2010� 2011� 2012�

� 19,2� 19,2

to contact Solidaridad Central america go to solidaridadnetwork.org/centralamerica












solidaridad west aFriCa

SMallholder PalM oil for loCal MarketS

solidaridad west africa has strengthened relationships with private sector partners, government agencies and producer groups across the region in oil palm, cocoa, cotton and gold. a € 12 million grant from the dutch embassy will fund a large-scale palm-oil programme for the next four years.

regional netWork

The network includes companies, knowledge partners,governments and CSOs. Partnerships were built with tradingcompaniesincocoasuchasCargill,ECOM,ToutonandNobleResources and in palm oil with Unilever and Wilmar. Knowl-edge partners include the International Plant Nutrition Insti-tuteinKenya,whichisdevelopingprotocolsforbestmanage-ment practices for the palm-oil programme, and universitiessuch as Wageningen on mapping the oil palm sector andErasmus on baseline and impact assessments for gold, incollaborationwiththeUniversityofCapeCoastinGhana.TheministriesofagricultureinNigeria,IvoryCoastandGhanaarealso involved. Key CSO partners are WWF, Conservation Alli-anceandGIZ.

Market deVeloPMent

Solidaridad engages with Unilever in a partnership to inte-grate smallholders in their palm oil supply chain for WestAfricabyguidingthemtoproducemoresustainably.Unileverwill provide support by integrating traceable smallholderpalm oil from a sustainable source into their supply chainthrough RSPO certification. The oil will be processed in localandregionalfactories.


Smartandsustainablelanduseisaddressedinallprogrammes.In oil palm best management practice plots showcase thepotential of small-scale approaches. In cocoa collabora-

tion with a consortium in Ghana on rural service centres willstart in 2013. Via these centres farmers will be able to doubleproductivity through access to improved planting materialand fertilizers and rehabilitation services such as grafting.Within annual crop programmes there is training on conser-vation farming and demonstration farms have been estab-lished. This will improve yields, mitigate the risk of draughtanderosionwhilemaximisingorganicmatterinthesoil.

organiSation

In 2012 Solidaridad West Africa doubled its turnover. Withfour-year funding from the Dutch Embassy in Ghana, aregional sustainable oil-palm programme started, focusingon improving the productivity of small and medium-sizedfarmers and mills. The funding base has been diversifiedwith support from new companies, WCF and the Bill &Melinda Gates Foundation. The office has recruited expertson commodity programme management and a communi-cation & knowledge manager is developing a virtual knowl-edge centre for sustainable palm-oil production and writingbrochures. New programmes for which proposals weredeveloped in 2012 include maize and soy bean for Ghana aswellascottonprogrammesinMaliandSenegal.

Cocoa 3,446,000 Fruitandvegetables 6,000 Cotton 94,000 Gold 130,000 Palmoil 784,000 Other 15,000


Programmeinvestments 4,475,000 HRM 469,000 Officeandothercosts 156,000

actual 2012� €�5,100,000

Personnel Solidaridad West africa in fte

2010� 2011� 2012�

22� 32� 46

to contact Solidaridad West africa go to solidaridadnetwork.org/westafrica












solidaridad southern aFriCa

forMing PartnerShiPS aCroSS the region

many key partnerships were formed in 2012 — with the private sector, other international Csos, local Csos, governments, universities and funding agencies. over one hundred of these partners attended a conference in may in Pretoria exploring regional aspects of the solidaridad theme: making markets work for the poor.

regional netWork

Solidaridad Southern Africa focuses on sugar, soy, livestock,cotton, biomass and tea. In South Africa the most impor-tant projects are in sugar, livestock, cotton and rooibos. InMozambique, the emphasis is on cotton, soy, black tea andagroforestry,inZambiaoncotton,andinMalawiit’sonsugar,soy and black tea. Food security is a theme that cuts acrossall cash-crop programmes; this involves the production ofstaple crops such as maize and cassava, along with beans,groundnuts and soy (as a food crop). Solidaridad cooper-ateswithanumberofcompanies,notablywithOlamandJFS(cotton and food crops), Mondelez (former Kraft) and Illovo(sugar),aswellasvariousgovernmententitiesandembassies.The regional office is expanding cooperation with regionally-based offices of international organisations such as ConcernUniversal, TechnoServe, WWF, and the Southern AfricanTrust.Ithaspartneredwithlocalproducerorganisationssuchas NASFAM in Malawi, CAZ in Zambia and Fonpa in Mozam-bique and local CSOs such as Abiodes in Mozambique andLimaandtheCaneGrowersAssociationinSouthAfrica.

Market deVeloPMent

The region is involved in developing a sustainable cottonsupply chain, for example by working closely with twolarge commodity supply companies (Olam and JSF) and byinvolving producer associations and the textile and retailsector further up the value chain. Farmers in Mozambiquealso receive support in producing sustainable biomass and

creatingalocal-to-localmarketforcharcoalandenergyfrombiomass. The aim is to improve yields, strengthen livelihoodsforsmallholdersandintroduceimprovedsustainabilitymeth-odologies.


Alongside initiatives to improve food security, the regionaloffice is developing user-friendly information manage-ment and self-assessment tools. These currently focus onthe sugar sector, but plans are also being made to expandthis programme to cotton, soy and biomass. This workinvolves inter-regional cooperation with the South Americanoffice. The system is an e-tool that will improve the abilityof producer associations and smallholders to implementsustainable management systems, access certification andverificationschemesandthusimprovemarketaccess.

organiSation

The Southern African regional office moved from BotswanatoPretoriainSouthAfricaatthebeginningof2012.Therearenow six full-time and three part-time staff in Johannesburgand one employee in Mozambique since a sub-office wasopened in Maputo. It is expected that regional capacity willexpandin2013-14asnewprogrammescomeonline.

Tea 71,000 Cotton 200,000 Sugarcane 160,000 Other 111,000



actual 2012� €�810,000

Personnel Solidaridad Southern africa in fte

2010� 2011� 2012�

� 2� 9

to contact Solidaridad Southern africa go to solidaridadnetwork.org/southernafrica












solidaridad eastern and Central aFriCa

froM SubSiStenCe to CoMMerCial farMing

a key development in 2012 was approval of funding by the netherlands embassy in Kenya for a horticulture and Food security programme in which solidaridad is the leading organisation as part of a consortium involving hivos and snv. the programme takes smallholders from subsistence to commercial farming.

regional netWork

Solidaridad Eastern and Central Africa works with producerorganisations, governments, civil society organisations andcompanies. There is collaboration with Armanjaro, Volcafe,Sucafina,ECOM,DEGandtheBillandMelindaGatesFounda-tion on coffee projects in the region. There is also collabora-tion with the Ethical Tea Partnership (ETP), Rainforest Alli-ance, the Kenya Tea Development Agency, East Africa TeaTrade Association and a partnership with Fairtrade Founda-tionandtheAllianceforResponsibleMiningongoldprojects. Key success factors include contract agreements andMemorandums of Understanding at the start of projects, sothat the roles and responsibilities of each partner are clear.Having a leading organisation such as Solidaridad and estab-lishing steering committees composed of members from allpartners is vital. There are regular conferences to maximisetheinvolvementofpartnersandbeneficiariesandthepartici-pationinregional,nationalandinternationalforums.

Market deVeloPMent

A tea factory called Iria-ini in Kenya was supported withcapacity building and branding. As a result, the factory hasbeen able to introduce a successful new product in the localmarket. In coffee there was collaboration with SavannahCommodities Ltd in Uganda, which stimulates consumptionoflocalcoffeeandinSouthAfricawithalocalroaster–BeanThere – to promote Utz Certified coffee, which is purchasedin East Africa and sold to over 30 supermarkets in South

Africa. In Kenya, groups of smallholder horticulturalists nowhave two new market outlets. Solidaridad helped them growbetter products – and sell them in supermarkets – and haslinked them to exporters, who sell their fresh produce to EUmarkets,especiallytheNetherlands.


Gender is integrated in all programmes, including trainingworkshops for the management and staff of partners incoffee, tea and horticulture and there are projects designedto involve the younger generation in coffee production inEthiopia, Kenya, Tanzania and Uganda. To promote climatechange adaptation and mitigation there is a partnershipwith ETP on developing training materials for field staff andtraining of trainers and tea extension services assistants. AclimatechangesymposiumfeaturedaSolidaridadstudyusingtheCoolFarmTooltomeasurecarbonfootprintonUtzcerti-fiedcoffeefarmsandthusaddressadaptationandmitigation.

organiSation

The Solidaridad Africa Foundation was established andSolidaridad Eastern and Central Africa was certified for ISO9001:2008.Theco-directorleftandanewonewasappointed.Threenewprogrammemanagerswereengaged(forhorticul-ture,gold,cottonandsugarcane)andanofficemanagerwasemployed.Acontinentalboardwassetup.

Coffee 1,381,000 Tea 129,000 Fruitandvegetables 1,066,000 Cotton 7,000 Gold 37,000 Sugarcane 19,000 Other 32,000


Programmeinvestments 2,671,000 HRM 201,000 Officeandothercosts 86,000

actual 2012� €�2,958,000

Personnel Solidaridad eastern and Central africa in fte

2010� 2011� 2012�

10� 9� 12

to contact Solidaridad eastern and Central africa go to solidaridadnetwork.org/eastcentralafrica












solidaridad south and south-east asia

food SeCurity PrograMMe in bangladeSh

in november 2012, a grant of € 12 million was received from the dutch embassy in bangladesh for the sustainable agriculture Food security and linkages programme (saFal). this will help 200,000 smallholders in southwest bangladesh adopt sustainable practices in dairy farming, horticulture and aquaculture, while improving food security.

Strengthening the regional netWork

Solidaridad South and South-East Asia (SSEA) views part-nerships as critical for addressing the difficult problems ofpoverty, environmental degradation and weak governance inthe region. Partnerships based on equity, transparency andmutual benefit have been established in a range of agricul-tural commodities. These include a Memorandum of Under-standingwithHindustanUnileverLimitedandIDHoncreatingan Indian sustainable tea code and supporting 540,000workers and smallholders in India with sustainable farmingpractices from 2012-16. There was underspending in the teaprogramme in 2012 due to delays in transferring resourcesandgettingapprovalfromindustrystakeholders. Another important partnership involving InternationalFinance Corporation (IFC) is helping 200,000 small-scalefarmersand14sugarmillsacrossIndiatocreateasustainablesugar-cane supply chain. This major programme, with $5.5millioninfunding,runsfrom2012until2016.

neW-Market deVeloPMent: a Shift of foCuS

Changes are underway, driven by market players and marketforces. Whereas in the past the focus was on sourcing indeveloping countries for markets in OECD countries, nowAsia itself is the main market for most agro-commodities.SolidaridadSSEAisworkingwithglobalbusinessestosustain-ably transform the markets for tea, cotton and garmentsin India as well as those for tea, cocoa and palm oil inIndonesia.


Classic Solidaridad themes such as smart sustainable landuse, gender and farmer training are an integral part of allprogrammes. Measures are being undertaken to ensure thatwomen are equal partners in SSEA programmes and manysmallholders across the region are women. Given the Indiangovernment’srequirementfor5%ethanoltobeblendedwithpetrolfromJune2013(requiring1,000millionlitres),makingbio-basedenergyavailableisanimportantcomponentofthesustainablesugar-caneprogramme.

organiSational deVeloPMentS

The past year has seen rapid growth. Starting with a singleoffice in Delhi, eight offices are now being set up across theregion. The current staff of 8 FTEs is expected to grow to 60FTEsbytheendof2013.Tomanagethisevolution,aregionalmanagement committee is being set up, a new HR system,smarter software, and PME are being introduced, and thePromis project management system is being integrated intoprogrammemanagement.

Coffee 31,000 Tea 138,000 Cocoa 20,000 Cotton 11,000 Textiles 36,000 Soy 119,000 Sugarcane 165,000 Other 24,000



actual 2012� €�728,000

Personnel Solidaridad South and Southeast asia in fte

2010� 2011� 2012�

9� 11� 19

to contact Solidaridad South and South-east asia go to solidaridadnetwork.org/ssea












solidaridad China

interVention StartS With farMerS’ aMbition

solidaridad China’s approach is to convince producers to invest in sustainability by first listening to their ambition for quality improvement and market access. such an approach meets both international requirements and farmers’ needs.

regional netWork and Market deVeloPMent

Overthepastfewyears,SolidaridadhassetthestagefortheBetter Cotton (BCI) launch in China in 2012, which will leadto more large-scale BCI projects as well as spin-offs for Soli-daridad. H&M is closely involved with Solidaridad’s cleanertextileproductionprogramme,whichresultedinaroundtwomillion metric tons of water being saved and re-used. H&Mand Solidaridad are now working on targeting a further 75factories. Solidaridad China is also building a joint task forcewiththeMarketTransformationInitiativeteamofWWFChinato strengthen demand and mobilise support for sustainablyproduced products such as certified soybean, palm oil andsugarcane. In collaboration with the Chinese Tea Marketing Associa-tion,Solidaridadhasbeenpromotingtheconceptofrespon-sible consumption among consumers in China. It is alsoworking with China’s biggest online store (Alibaba) to createonline sales space for sustainable products. More impor-tantly,SolidaridadishelpingWWFChinatobuildaresponsibleprocurement forum among China’s top ten retailers, whichwill not only manage supply chain risks, but also promotesustainableconsumptionamongChineseconsumers.

PartnerShiPS

Due to the enormous scale of both production and marketin China, to promote sustainability in an effective way, Soli-daridad mainly relies on stakeholder platforms (some ofwhich it helped create) to build alliances and make joint

efforts.Besidesworkingwithindustryassociations,thereisanewstrategytobuildpartnershipswithChinesegovernmentdepartmentswiththeaimofgeneratingextrafundsforinno-vationandtechnicalimprovements. In 2012, Solidaridad’s intervention resulted in tangible,measurable benefits for over 10,000 farmers, including teafarmersfromMyanmar,whocrossedthebordertoattendanin-depthprogrammeinYunnanprovince.

CroSS-Cutting theMe

Solidaridadtakesanin-depthapproachtoaddressingfarmers’needs, while helping them meet international requirements.This approach has proven effective in winning trust fromproducersand is crucial tomaintainingtheir commitmenttomoving towards sustainable production when there are stillinsufficientincentivesfromthemarket.

organiSation

In 2012 Solidaridad China doubled in size to eight FTEs,restructured its management system and created an inde-pendent financial management system. By the end of theyear a stable management structure was in place, includingthe recruitment of an FSP liaison, a financial controllerand a specialist in creating decent working conditions inagriculture.

Tea 67,000 Cotton 181,000 Soy 40,000



actual 2012� €�481,000

Personnel Solidaridad China in fte

2010� 2011� 2012�

4� 9� 9

to contact Solidaridad China go to solidaridadnetwork.org/china












solidaridad the netherlands

CaMPaignS raiSe Solidaridad’S Profile

three eye-catching campaigns have raised solidaridad’s public profile in the netherlands: ‘why poverty,’ in collaboration with public broadcasting; ‘For the love of chocolate,’ with mars; and the market launch of ‘good gold,’ in collaboration with twelve goldsmiths and jewellers. solidaridad’s higher profile has led more and more people, government bodies, foundations and companies to support its work.

fundraiSing

The Solidaridad team in Utrecht shares the responsibility forsourcingthefundsneededfortheprogrammesandprojectsof our partners in developing countries. In 2012, Solidaridadin the Netherlands received €19.1 million, 26% more thanexpected. As more and more government bodies, endowments andcompanies across Europe are providing support, we expectstronggrowthintheyearsahead.

SuStainable Market deVeloPMent

SolidaridadNederlandworkswithmanycompaniesinEuropeto make their production chains more sustainable. Thecollaboration focuses on advising producers in developingcountries, on certifying products and on developing marketsand consumer demand. More and more programmes areco-financed by the companies concerned, whether througha direct financial contribution to Solidaridad (€2.9 millionin 2012), or more often through direct co-financing of theproducers’developmentprogrammes(€3.3millionin2012).

the CaMPaignS

In 2012, Solidaridad conducted three campaigns in theNetherlands: the ‘Why poverty?’ and ‘For the love of choco-late’ campaigns, which took our message to a total of 16million people and the campaign for ‘Good Gold,’ whichwas supported by the National Postcode Lottery. This drewattention to the miserable circumstances in which gold

is mined and to the alternative developed by Solidaridadand its partners. ‘Fairtrade and Fairmined’ (FT&FM) gold isnow available at a growing number of retail outlets in theNetherlands.influenCing PoliCy-MakerS

Solidaridad advises companies on how to change their poli-cies and make the economy more sustainable. Solidaridaddoesn’tactasaconsultantinthisrespect,butasa‘corporatechallenger’. We challenge companies to be more ambitiousandtoinitiaterealchange.Theideaisthatcompaniesbecomeactiveparticipantsandshareinthecosts.Solidaridadalsohasa voice in the debate about the future of the Dutch govern-ment’s development cooperation policies. In our view, aidandtradeareperfectlycompatible,as longasthefocusisonsustainableeconomicdevelopment.

organiSation

In2012,SolidaridadintheNetherlandsputalotofeffortintoimprovingqualitymanagementsystems.ThePromismanage-ment information system and the Results-Based Measure-mentSystemhavebeenrolledout.Thishasgreatlyincreasedourcapacitytomanage,steer,makecorrectionsandlearn.

Coffee 2,152,000 Tea 576,000 Cocoa 1,276,000 Fruitandvegetables 2,000 Cotton 2,871,000 Textiles 1,047,000 Gold 479,000 Soy 1,401,000 Palmoil 1,312,000 Sugarcane 1,351,000 Livestock 900,000 Other 2,646,000


Programmeinvestments 16,013,000 HRM 2,118,000 Officeandothercosts 1,116,000

actual 2012� €�19,247,000

Personnel Solidaridad the netherlands in fte

2010� 2011� 2012�

20,3� 27,1� 30,7

to contact Solidaridad the netherlands go to solidaridadnetwork.org/netherlands












solidaridad north ameriCa

neW regional offiCe in San franCiSCo

as major importers of agricultural products, including significant volumes of solidaridad’s core commodities, the us and Canadian markets are vital to achieving solidaridad’s mission. in 2012 alone, us imports of coffee amounted to $ 8.9 billion, cocoa $ 4.1 billion, vegetable oil $ 6.4 billion, fruit $ 12.5 billion, and sugar and sugar-based products were worth $ 4.8 billion.

the oPPortunity

ArapidlygrowingnumberofNorthAmericancompaniesarecommitting to sustainable supply chains. For example, Marsis committed to sourcing 100% of its cocoa from sustain-able sources by 2020, Starbucks has announced its aim tosource 100% of coffee by 2015 and Dunkin’ Donuts recentlyannounced a commitment to buy only sustainable palm oil.An increasing number of platforms such as the ConsumerGoods Forum and The Sustainability Consortium are helpingto secure similar commitments from even more companiesacrosstheregion. The Solidaridad Network is poised to build on thismomentum. By bringing its unique international experiencein developing standards, building producers’ capacity toimprove their livelihoods and linking them to end markets,Solidaridad can help North American companies meet theircommitmentsandencourageotherstofollowsuit.Itcanalsocreate new market linkages for producers across its interna-tionalnetwork. Toachievetheirgoals,NorthAmericandonorsarekeentouse their funds to leverage private sector finance. Solidari-dad’s track record of developing public-private partnerships,through, for example, the Farmer Support Programme, canmakeavaluablecontribution.Lastly,thereisgrowinginterestin the social entrepreneurship model in North America. Soli-daridadhasbeenattheforefrontofhelpingfarmersbecomebetter entrepreneurs and creating companies to fill gaps insustainablevaluechains.

aPProaCh

TheestablishmentoftheNorthAmericaofficewillallowSoli-daridadtoengagestrategicallywithkeymarketplayersacrosstheregion.Intheshortterm,theofficewillfocusitseffortsonfundraising and identifying opportunities for market devel-opment. In the medium term, it plans to expand its aims toinfluence policy and raise consumer awareness with regardtosustainableconsumptionofSolidaridad’s‘core’commodi-ties.TheNorthAmericaofficewillalsosupportnetwork-wideactivities designed to promote sustainable land use, reduceemissionsfromagricultureandadapttoclimatechange.

organiSation

Inthesecondhalfof2012,theNorthAmericaofficeappointedthreeboardmembersandstartedsupportingfundraisingandmarket development efforts for the network. In December,Solidaridad North America became a legal entity in the US.TheSanFrancisco-basedofficecurrentlycomprisesonestaffmember, with two additional hires planned for 2013, one ofwhomwillbelocatedontheEastCoast.

the establishment of the north america office will allow Solidaridad to engage strategically with key market players across the region.

to contact Solidaridad north america go to solidaridadnetwork.org/northamerica

58 TheSolidaridad2012annualreportPhoto:FredErnst


goVernanCe, SuPerViSion and finanCe

• CoMMuniCation

Solidaridad reaches a broader public

• SuPerViSion, ManageMent and organiSation

full supervisory structure nearly in place

financial report

auditor’s report


CommuniCation

Solidaridad reaCheS a broader PubliC

solidaridad conducts campaigns and communicates in a wider sense about sustainable economic development, in order to stimulate companies to act, to influence the public agenda and to win support from private donors.

Market deVeloPMent

With the European markets as its home base, the Dutchregional expertise centre (REC NL) builds alliances withcompanies to ensure the link from supply to demand.Together with these business partners, Solidaridad cooper-ates on marketing and communication in order to createconsumer awareness and to increase demand for sustain-able products. By developing direct linkages between buyersand producers, market transformations towards sustainablechangeareshapedandimproved. In 2012 Solidaridad initiated the GfK sustainable consumerscantoencourageourbusinesspartnerstointegratesustain-ability in their marketing strategies. This consumer researchshows that the consumer awareness of sustainable productsis growing in the Netherlands. It also shows that consumersexpect companies to take responsibility and communicateaboutthesustainabilityoftheirproductsinacomprehensiveandcredibleway. Most companies find it difficult to reach consumers in thisarea and feel the limitations associated with a label or certi-fication. The For the love of chocolate campaign in 2012,conductedwithMars,showsthatSolidaridadcanbeaninter-esting partner for companies that wish to fulfil consumerexpectationsaboutthem,becomingmoretransparentabouttheircommitmenttosustainableproducts.

CaMPaignS

for the loVe of ChoColate

Solidaridad and the chocolate manufacturer Mars againconductedtheFor the love of chocolatecampaignin2012,itsthirdyearnow.ItsgoalistoalertabroadpublicintheNether-landstothethreateningscarcityofcocoa,topresentsustain-able cocoa farming as the only solution and to highlight theimportanceofthecocoafarmerinthissolution. Following the design of a new web site, the campaign wasrelaunched in June in the Leidseplein in Amsterdam, by thewell-known Dutch actress Katja Schuurman. She spoke ofher love of chocolate and her worries about the possiblecocoa shortage. Her words prepared the ground for activi-tieslaterintheyear.InOctober,MarsandSolidaridadopenedthe Netherlands’ first chocolate jewellery shop. For one day,showcases that normally display very rare and expensivejewellery were filled with chocolate jewellery. The message

was:ifchocolateproductiondoesnotbecomemoresustain-able, chocolate will be a precious commodity and chocolatejewellery shops will appear! Both the launch in June and thechocolate jewellery shop in October were well covered byradio,TV,newspapers,journalsandtheonlinemedia. In the autumn, a camera team from the NationalGeographic Channel, followed by a group of journalists, trav-elled through Ghana and made a 50-minute documentary,entitledFor the love of chocolate.KatjaSchuurmancalledonthe cocoa farmers and spoke about making cocoa growingmore sustainable. The documentary was first shown in theNetherlandsonSunday2December2012.Intheweekbeforeit was shown, all the television guides carried reports on thetrip and the documentary. In these two weeks, the campaignreached67%oftheDutchpublic. Items of the For the love of chocolate campaign wereshown on national radio and television programmes eighttimes, including Eénvandaag on 28 November (more than 1million viewers). It was covered in about 70 articles in news-papers and journals, including the two largest Dutch news-papers, the Telegraaf and Volkskrant and all the televisionguides.Morethan150reportswereincludedinonlinemedia,and the campaign was prominently featured on the largestDutchnewssite,www.nu.nl. Intotal,thecampaign,whichreached15.7millionusersinthe13+targetgroup,hadanestimatedmediavalueofmorethan€1.2 million. A qualitative study of the effect of the campaignshowedthatpeoplewhohadheardaboutthecampaignmorefrequently also knew more about the threatening scarcity ofcocoa. In view of Solidaridad’s limited resources, campaignsthatextendoverseveralyearsarenecessaryinordertocreatesufficientawarenessamongtheDutchpublic.Thisisaprereq-uisite for long-term changes in the knowledge and attitudesofthesectorandthegeneralpublicwithregardtosustainablechocolate.

toWardS good gold

In May 2012, Solidaridad launched Fairtrade&Fairmined goldin the Netherlands. At the media event, the columnist andtelevision anchorman Jort Kelder presented the first goldjewellery with the Fairtrade & Fairmined (FT&FM) hallmarkto international guests from the jewellery and gold miningsector. This is the world’s first system in the jewellery sectortocertifythatgoldhasbeenextractedinafair,safeandenvi-ronmentallyfriendlyway.APeruvianminerpresentedactressand television personality Katja Schuurman with the first


‘GoodGold’braceletwithaFairtradehallmark. The FT&FM standard will improve the working conditionsintheworld’ssmall-scalegoldmines,whichemploy20millionpeople. Solidaridad is also working to make large-scale goldminingmoresustainable.ThePRvalueoftheeventtolaunchtheFT&FMhallmarkwas€2.3million. Other smaller initiatives, with a light touch, have beentaken to raise the Dutch public’s awareness of issues inthe gold mining sector. These include social media activi-ties connecting to the gold medals awarded at the OlympicGames, the Golden Calf award at the Netherlands FilmFestival, and the golden Loeki award for television advertise-ments.

CorPorate CoMMuniCation

Why PoVerty?

From 25 November to 2 December 2012, the Dutch publicbroadcastingnetwork(NPO)organisedananti-povertyweekunder the name, Hoezo Armoede (Why poverty)? It showedrealinitiativesthathavealreadybeentakentocombatpovertyand the activities of companies, governments and NGOsin Asia, Africa and South America. The Why poverty? weekfocusedonpeople’sabilitytoliftthemselvesoutofpoverty. Solidaridadwasanactiveparticipantatthelaunch,becausewe believe that a fair and sustainable economy can put anend to poverty. With just a little support, farmers who livebelow the poverty line can often achieve higher yields andthus increase their income. At the launch, Solidaridad gave

a presentation about the future of cane sugar, participatedin a debate with other NGOs, academics and the businesscommunity,andgavethepublicatasteofasustainablechoc-olatefountain.During the Why poverty? week, Solidaridad presented astrongprofileonradioandtelevisionandinmanymagazines,includingatwo-pageinterviewwithourdirectorNicoRoozeninallthemaintelevisionguides.

Web SiteS

In2012Solidaridaddevelopedacentralcontentmanagementsystem for its web sites. This simplifies the management ofsolidaridad.nl, opwegnaargoedgoud.nl, fortheloveofchoco-late.nl and the international web site solidaridadnetwork.org.Newwebsites,forexampleforparticularcampaigns,cannowbemadeandmaintainedmorecheaply. Thereachofsolidaridad.nlin2012wasstableatabout5000unique visitors per month. During the Why poverty? week inearlyDecemberitpeakedat8000visitorsinoneweek. Our international web site, solidaridadnetwork.org is thefastestgrowingsite.In2012itreceivedover52,000visitors,81%morethanin2011.ThissiteismainlyintendedforSolidaridad’scurrent and potential partners and commercial visitors. Thegrowthinvisitornumbersispartlyduetothegreaternumberof publications about our work and the use of social media.

SoCial Media

Social media again grew in importance in 2012. These mediaareusedmainlytomonitordiscussionsinthevarioussectorsin which Solidaridad is active, and to hear what is being said

the Pr value of the launch of fairtrade & fairmined gold was €2.3 million.

Photo:KekeKeukelaar


about Solidaridad. A growing number of fans and followersactivelyshareSolidaridad’spostings.Twitter and Facebook are effective in motivating a broadpublic for campaigns and LinkedIn is becoming increasinglyimportant as a way of contacting the donors and companiesSolidaridadworkswith–orwouldliketoworkwith.

annual rePort and PaMPhlet

The 2011 annual report was the first to cover the entire Soli-daridad network. New formats, a new working method andthe contributions of dozens of people from all around theworld made its production a complex challenge. Neverthe-less,thereportscoredjustaswellinthetransparencycompe-tition as the previous report. The publication of the Solidar-idad network report at the end of May was on schedule, butthe Dutch version, which was published at the end of June,was clearly late. Over the year the annual report was distrib-uted online and on paper to several thousand Solidaridadpartnersaroundtheworld. The corporate pamphlet developed in 2011 – with insertsfor the various commodity programmes – was used in 2012mainlyatconferencesandothermeetings,tointroduceSoli-daridadtopotentialnewpartners.

PubliCity

Solidaridadreceivedagoodamountofpublicityin2012.Therewere more offline publications and online publications. Thelattercanbeexpectedtoplayanevermoreimportantroleinthe media and in Solidaridad’s strategy. Many of the profes-sional journals read by our stakeholders publish promptonlinereportsondevelopmentsinthemarket.

Solidaridad’s activities in relation to fashion, soya beans andsugarcanearealsoreceivingmoreattention.Themediaandabroadpublicareinterestedintheseproductgroups. The focus for publicity in 2013 will be mainly on the GoodGold campaign, and the start of a new campaign on sugarcane. The Solidaridad Network’s new mission statement andvisionwillalsobepresented.

fund-raiSing froM PriVate donorS

Thegoalofourfund-raisingistoobtainfinancialresourcesforSolidaridad’s work, in an efficient way, from a growing groupof private donors in the Netherlands. Integrated multi-mediaPRcampaigns–intendednotonlyforfundraisingbutalsoformarketdevelopmentandpubliceducation–producethebestresults. They contribute to awareness among donors, thebusiness community and consumers regarding the origin ofour products and how they are produced, and they publicizetheworkSolidaridaddoeswithitspartners.

direCt Mail

Sending a letter with a giro payment slip is still the most effi-cient way for Solidaridad to obtain donations. More donorsare now using online banking to contribute, but the giropaymentslipisstillrequired,toremindthemtodoso.In2012,Solidaridad sent out five mailings with the following subjectsandresults:

Subject Numbersent Responserate Result

DM1 Textiles 22,059 18 % € 110,142

DM2 Annualreport 35,478 8 % € 83,065

DM3 Cocoa 30,846 13 % € 109,295

DM4 Sugarcane 8,635 35 % € 117,971

DM5 Sugarcane 8,636 11 % € 25,218

About half of the donations from individual donors can bedirectly attributed to the mailings. The other half, of a totalof €937,596 in donations, came from online transfers andcannot with certainty be attributed to the mailings. Solidari-dad’s working method makes the response rate very muchdependent on the number of appeals posted. The higher thenumber, the lower the response rate is, because we post lessoftentoincidentaldonors.Nevertheless,anegativetrendcanbe seen in the response rates over the course of 2012, due inpart to more difficult economic conditions. In recent years,many development organisations have found struggled to

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15 5

31 1 0 0

52

72

14

1 0

10

17

41

31 1 0

30

5 51 0 0 1 0

5 4

1919

12

19

13

30

107

20 0

2011-52

2012-03

2012-06

2012-09

2012-12

2012-15

2012-18

2012-21

2012-24

2012-27

2012-30

2012-33

2012-36

2012-39

2012-42

2012-45

2012-48

2012-51

2012� 114

2011� 72

2010� 141

2009� 78

2008� 68

the bars show the number of offline publications from 2008-2012. 114 in 2012, 72 in 2011.

number of online publications in 2012 (in weeks).

Fairtrade&Fairminedgoldlaunch

NationalGeographicdocumentary‘Fortheloveofchocolate’andWhy povertyweek


keep their income from private donors at the same level.Unfortunately,thatincludesSolidaridad.BecauseSolidaridadhasnotbeenontheoffertoryscheduleoftheRomanCatholicChurch since 2010, income from this source is declining. Yet,since many parishes continue to pass the plate for Solidari-dad’s work, revenues have fallen less than was anticipated inthe budget. In 2012, substantially more was received in dona-tions from companies and organisations than in 2011, andmore than was budgeted. These are mainly donations fromcompanies and organisations that support the developmentof sustainable chains of production (see also the section onSupervision,managementandfinance).

large donationS

IfSolidaridadreceivesadonationof€300ormore,amemberofSolidaridad’sstaffthanksthedonorpersonally.Solidaridadoffers to send them more information or a small gift such asthe Good Gold bracelet or a photo book. Responses to thispersonalshowofgratitudehavebeenverypositive.CoMPlaintS

Every complaint that Solidaridad receives is answeredpersonally by a staff member. Depending on the subject,the response may come from someone in the secretariat, aprogramme officer or a communication officer. In 2012, Soli-daridad received two substantive complaints as a result ofthe direct mail campaigns. All complaints are processed andansweredinaccordancewithafixedprocedure.

the national PoStCode lottery

Since 2009, the national Postcode Lottery has made animportantcontributiontoSolidaridad’sworkeveryyear.ThePostcode Lottery also mentions our projects in its television

programmes and in national newspapers. In 2012 the Post-codeLotteryincreaseditscontributionstogoodcauses.Soli-daridad received €1,350,000. The national Postcode Lotteryprovides a considerable proportion of our private income,enablingustofundasignificantnumberofprojects. The Postcode Lottery also made an extra donation of €1.7millionfromitslotteryincome,enablingSolidaridadtoexpanditssupportforgoldminersinLatinAmericatoincludeminersin Ghana. This is an important step for the gold programme.The funding is intended for the project ‘The face of Ghana’sgold’–athree-yearprogrammethatincludestrainingminersin safe and efficient mining techniques and arranging certifi-cationinaccordancewiththeFairtrade&Fairminedstandard.The Postcode Lottery and Solidaridad will highlight theprojectforthegeneralpublicbysubstantiallyreinforcingtheTowardsGoodGoldcampaignintheyearsahead.

aSn bank

In 2012, the ASN Bank’s support has helped Solidaridad toinitiate and continue projects in India, China and Bangladeshthatcontributeefficientlyandeffectivelytobetterconditionsin the textile and clothing industry. The aim is both betterworking conditions and reduced environmental impact. Therelevanceofthesethemesisclearfromrecentreportsinthemediaaboutabusesinclothingfactories.

air MileS

Solidaridad is part of the Air Miles saving programme.SupporterscanchoosetodonateAirMilesonceorstructur-allysaveAirMilesforSolidaridad.ForeachthousandAirMilesdonated,fiveEurosareremittedtoSolidaridad.

lauren Verster opened the first ‘chocolate jewellery shop’ in the netherlands. for one day it showed what will happen if cocoa becomes a scarce product.

Photo:DiederikvanderLaan


SolidaridadSouth

America

Jeroen Douglas

SolidaridadAndes

Gonzalo la Cruz

SolidaridadCentral America

Michaelyn Baur

SolidaridadWest Africa

Isaac Gyamfi

SolidaridadEastern and

Central Africa

Karugu Macharia

Executive BoardSolidaridad network

Executive director:Nico Roozen

Solidaridad NetworkSecretariat

InternationalSupervisory Board

Management

ContinentalSupervisory BoardSolidaridad network

Africa


Latin America(FSLA)


Asia

Supervisory BoardSolidaridad network

The Netherlands

SolidaridadSouthern

Africa

Annie Sugrue

SolidaridadSouth and South East

Asia

Shatadru Chattopadhayay

SolidaridadChina

Martin Ma

Solidaridadthe

Netherlands

Nico Roozen

LATIN AMERICA AFRICA ASIA EUROPE

Supervision

suPervision, management and organisation

full SuPerViSory StruCture nearly in PlaCe

the solidaridad network seeks to be an effective, influential, innovative learning organisation, which can consider itself to be among the best in the field of international development cooperation. this requires checks and balances throughout the organisation. a fully operational network supervisory structure, which has been developed in recent years, will be completed by the end of 2013.

netWork StruCture

SuPerViSion

The new supervisory structure is intended to ensure thatthe Network is seen as a credible organisation with a trans-parent, responsible, cost-effective system of supervision,and one that affirms Solidaridad’s vision, programme andworking methods. Its fundamental principles are to ensure ahigh degree of autonomy for the regional expertise centres,fostering solidarity by means of world-wide strategies foreachcommoditysector,aprofessionalapproachtomaximisetheprogrammes’impact,andasharedvisionandmission. The International Supervisory Board (ISB) is the highest(international) level.TheISBmonitorspolicies,thequalityofprogrammes, financial control and the performance of theExecutiveBoardofDirectors.TheISBisguidedintheperfor-manceofitstaskbytheinterestsoftheSolidaridadNetwork. Four continental supervisory boards monitor the regionalprogrammes,thelastofwhich,theAfricanSupervisoryBoard,was set up in 2012. The continental Supervisory Boards each

delegateonemembertotheInternationalSupervisoryBoard,which will be established in 2013. Until then, the members ofthe Supervisory Board of Solidaridad the Netherlands alsocomprisetheInternationalSupervisoryBoard.

ManageMent

The global executive level is formed by the meeting of thedirectors of the nine Solidaridad organisations that consti-tutes the decision-making Executive Board of Directors(EBoD).TheEBoDisthepolicy-makingbody,providingpolicycoherence, consistency and relevance and it is also respon-sible for implementing policy. The chair of the EBoD is theInternationalExecutiveDirector.

regional exeCution

The nine Solidaridad organisations are responsible for coor-dinated global programmes. Regional management is theresponsibility of the individual directors, who lead theirregional office and respective staff. The regional Solidaridadorganisations,whichareresponsibleforprogrammedevelop-ment,arelegallyclusteredatthecontinentallevel,producing

Solidaridad network


consolidated policy development and financial statementswithin one legal entity per continent. The continental legalentities are affiliated to the Network. This allows joint policydevelopment and hiring and firing of directors and ensuresthatoperationsarefinanciallyautonomous.TheregionalSoli-daridad organisations are legal branches of the continentalentities,thusavoidingnationalboardstructures.

SuPerViSion

he CoMPoSition of the SuPerViSory board

At the end of 2012, the Supervisory Board of Solidaridad theNetherlands consisted of Saskia Borgers, Ton Geurts (chair-personfromJuly2012),MaartenvanderGraaf,GerritMeester,TheoJanSimons,MariekedeWalandAlbertJanZonnevylle.In 2012 we said farewell to Roelf Haan, who was chairpersonuntilJuly2012,andJanvanHoof. To guarantee the separation of functions and to preventconflicts of interest, no close family or comparable relation-ships are permitted within and between the members of theSupervisory Board and the Management. The members oftheSupervisoryBoardmaynotbeSolidaridademployeesoraboardmember,founder,shareholder,supervisororemployeeof any organisation with which Solidaridad, in the normalcourse of its work, conducts any transactions that can bevaluedinmonetaryterms.

The Supervisory Board met four times in 2012. The mostimportanttopicsdiscussedwere:

− Strategy:developinganetworkorganisation,evaluatingthemeetingsoftheBoardofDirectorsinAprilandOctoberanddecidingontheannualplanfor2013.

− finance:finalisingtheannualreportfor2011,discussinginterimfiguresfor2012andsettingthebudgetfor2013.

− Management:introducingthenewSupervisoryBoardandexploringthepossibleexpansionoftheSupervisoryBoard.

− evaluation:annualreportfor2011anddiscussionsonthesectoralprogrammesforcotton,textiles,sugarandsoy.

The audit committee advised the Supervisory Board on theannualaccountsfor2011,thebudgetfor2013andinvestmentregulations.

reMuneration of the SuPerViSory board

InaccordancewithSolidaridad’sstatutes,themembersoftheSupervisoryBoardofSolidaridadreceivenoremunerationofanykind.

ManageMent

direCtor

NicoRoozenisthestatutoryDirectorofSolidaridadtheNeth-erlands and Executive Director of the Solidaridad Network.He is also a member of the Supervisory Board of Utz Certi-fied, a member of the stakeholders’ platform of the BusinessSocial Compliance Initiative (BSCI), a member of the Task-force on Biodiversity and Natural Resources, and he serveson the panel of the United Nations Forum on Sustainable

Standards in Geneva. Since May 2012 he has been a memberof the Supervisory Board of ASN Investment Funds N.V. andamemberoftheSupervisoryBoardofASNGroenprojecten-fonds. Until September 20, 2012, he chaired the SupervisoryBoardofKuyichiInternationalB.V.

reMuneration of the direCtor

TheSupervisoryBoardupdatesitsalariespolicyfromtimetotime. The most recent evaluation was in October 2012. TheDutch Wijffels Code and the VFI’s Adviesregeling BeloningDirecteurenvanGoedeDoelen(Guidelinesfortheremunera-tionofDirectorsinphilanthropicorganisations)weretakenas

Members of the Supervisory board for Solidaridad the netherlands

Saskia borgersMemberTermendsDecember2014– Environmentalsociology,environmentalexpert– Haarlemmunicipality,Secretary/GeneralDirector– ChairpersonofSurplus(linkingprimaryschoolsinNorthHolland)– MemberoftheArbitrationBoardofBureauIntegriteitNederlandse

Gemeenten

ton geurtsChairpersonTermendsDecember2014– Masterof(Dutch)Law– ChiefProcurementOfficerforAkzoNobel

Maarten van der graafMemberTermendsDecember2014– Masterof(Dutch)Law– BarristerandpartneratStekAdvocaten

gerrit MeesterMemberTermendsDecember2014– DoctorofAgriculturalEconomics– RetiredadvisoronquestionsofagriculturalpolicytotheMinistryof

Agriculture,NatureandFoodQuality– MemberoftheCouncilfortheEnvironmentandInfrastructure– MemberoftheCommitteeonGeneticModification– MemberoftheBoard,CentreforWorldFoodStudies(SOW-VU)

theo jan SimonsMemberTermendsDecember2015– MScinChemicalEngineering– McKinsey

Marieke de WalMemberTermendsDecember2014– MAinPhilosophy– Organisationalresearcherandconsultant– NetworkcoordinatorforthePartnershipsResourceCentre/

RotterdamSchoolofManagement/ErasmusUniversity– SeniorresearcherattheNetherlandsSchoolPublicAdministration– MemberoftheSupervisoryBoardofIKVPaxChristi

albert jan zonnevylleMemberTermendsDecember2015– Masterof(Dutch)Law– RabobankInternational


guidelines in the evaluation. The latter proposes a maximumnorm for the annual income, based on certain criteria. TheSupervisory Board found the Director’s position had a ‘BSD’score of 460 points, for which the full-time maximum annualincomeis€124,233. The actual annual income of the Director for 2012, beforethis evaluation using the VFI maximum, was €96,459 (25%belowthemaximum).Thelevelandcompositionofthissalaryisexplainedbelow.

remuneration of the director: nico roozen

2012 2011

Employmentcontract Indefiniteperiod Indefiniteperiod

Hours 36 36

Percentageoffulltime 100 100

Period Allof2012 Allof2011

Remuneration(ineuros)

Grosssalary 82,469 80,712

Endofyearbonus 6,845 6,699

Holidaypay 7,145 6,993

96,459 94,404

Employersocialsecuritycontribution

8,216 6,934

Taxableallowances - -

Employerpensioncontribution 21,408 20,211

Otherbenefits - -

Paymentsattermination - -

total 126,083 121,549

Solidaridadprovidednoloans,advancesorguaranteestotheDirector. Twothirdsofthisamount(€84,055)isbornebySolidaridadthe Netherlands and one third (€42,028) by the SolidaridadNetwork.

organiSation

annual and long terM Planning

SolidaridadproducesalongtermStrategicPlan,whichshowshowittranslatesitsprimarygoal,missionandvisionintooper-ational objectives. This plan is drawn up by the managementandapprovedbytheSupervisoryBoard.Theannualplansareatranslationofthelong-termstrategicplanintomorespecificobjectives,desiredresults,activitiesandbudgets.Solidaridadmakes its objectives measurable using indicators, which areformulatedusingtheSMARTapproach(Specific,Measurable,Attainable,RelevantandTime-bound). A context analysis and evaluation of the previous annualplanserveasguidelinesinpreparingthenextannualplan.TheheadsofdepartmentswriteannualreportsinFebruary.Theseshowwhethertheobjectivesandexpectedresultshavebeenachieved.ThesereportsareevaluatedbytheDirector. Reportsonfund-raisingandmanagementandtheplansfortheseactivitiesarealsoevaluatedeveryyearandapprovedby

theDirector.Solidaridadgoalisthatthecostsofprivatefund-raising should be stable at 10 to 15% of the revenues fromsuchfund-raising.Exceptionsmaybemadeifitcanbedemon-stratedthataninvestmentinfundraisingwillbecost-effectivein the long term. Solidaridad not only finances projects indeveloping countries – it invests in making Western marketsmore sustainable by influencing policy-makers and throughresearch. Solidaridad strives to maintain a healthy relation-ship between its operational costs and its total costs. It hasdecided internally that the operational costs should notexceed25%oftotalcosts.ThislimithasbeensetbyanalogytothelimitthattheCBFappliestothecostsofanorganisation’sown fund-raising. Within these operating costs, Solidaridadseekstokeepthecostsofmanagementandadministrationaslow as possible without endangering the quality of its opera-tions.Apercentageofbetweenonepercentandtwopercentofallcostsisconsideredtobeahealthyproportion.

quality ManageMent PoliCy

Solidaridad seeks to achieve a high quality on all fronts.External auditors give independent evaluations of the qualityofeachaspectofitsoperations.Solidaridadiscertifiedunderthe ISO 9001:2008 norm. Internal audits and an externalcertificateissuingbodyregularlyexaminewhetherthequalitymanagement system meets requirements and whether anyprogresshasbeenmade. The Central Bureau on Fundraising (CBF) monitors allphilanthropic bodies in the Netherlands and evaluates theirmanagement and policy, in order to increase the transpar-ency of the charitable organisations sector. Solidaridad isentitled to use the CBF quality mark and complies with itsrequirements.Theaccountabilitystatementpresentedbelowshows that Solidaridad upholds the principles of the CBFqualitymark. The Dutch Association of Fundraising Organisations (VFI)is the umbrella organisation for philanthropic organisationsthatraisefundsacrosstheNetherlands.Itsgoalistoincreasepublic confidence in fundraising institutions. Solidaridadupholds the principles of the VFI in relation to respect, reli-ability,opennessandquality.SolidaridadisrecognisedbytheTaxation Department as an institution serving the commonweal, which means that donations and bequests to Solidar-idadarenottaxed.DonorscanobtainincometaxdeductionsfortheircontributionstoSolidaridad.

audit of annual rePort and aCCountS

Externalreportingtakesplacethroughtheannualreportandaccounts. These are verified by an auditor and accompaniedbyanauditor’sopinion.TheSupervisoryBoardhasappointedErnst & Young as its external auditors. This appointment isreviewedandrenewedannually.Theappointmentcoverstheaudit of the annual accounts and the accounts for variousprojects. Ernst & Young do not provide any non-auditingservices. The auditor discusses his findings with the DirectorandFinancialControllerandmayalsocalltheattentionoftheSupervisory Board to any points that must be addressed, orwhereimprovementscouldbemade.


eValuationS

eMPloyee eValuationS

Onceayeareachemployee’sdirectmanagerinviteshimorherfor an appraisal and performance evaluation interview. Theoutcome of that interview includes areas in which improve-mentscouldbemade,fortheemployeeandforthemanager.Thefocusisontheemployee’sdevelopmentand‘growth’,butitalsocoversthedevelopmentofthepositionheorsheoccu-pies, and work motivation. The heads of department discussthe results of these interviews with the Director during theirownappraisalandperformanceevaluations.TheDirectorhasan appraisal and performance evaluation interview with theSupervisory Board – or with some of its members – every sixmonths.

evaluation of the operational structureThe Management evaluates the working of the entire qualitymanagement system, including the policies and objec-tives, every year. In 2012 the conclusion was that the quality

management policy and system are suitable and effective.The most important points that need to be addressed in thecoming year are the introduction and improvement of theprojectmanagementsystemandharmonisingprocessesandsystemsinthefieldsofplanning,monitoringandevaluation.

evaluation of the Supervisory boardThe Supervisory Board is relatively new; five of the sevenmembers were appointed in 2011 and two in 2012. During itsmeetingsin2012,theSupervisoryBoardregularlyrevieweditsownfunctioning.Anevaluationisplannedearlyin2013.

Staff and WageS

In 2012, Solidaridad had an average of 28.9 employees, whentranslatedintotheequivalentnumberoffulltimestaff(FTEs).Thisfigurein2011was23.7.Attheendof2012,Solidaridadhad35employees.TheaveragegrossannualsalaryperFTEin2012was €61,700 (2011: €63,600). The total personnel costs perFTEin2012were€77,200(2011:€77,400). Solidaridad has its own salary structure document, whichdescribesallstafffunctionsandthetasksandresponsibilities

organiSation deVeloPMent in ProgreSS

ThenineSolidaridadorganisationsthatformtheglobalnetworkdevelopaccordingapatern.Thismodeloforganisationdevelopmentdefinesthreestages:initial,intermediateandmature.Eachorganisationisscoredagainstseveralindicatorsofprogress.MostoftheSolidaridadorganisationsnowscoreintermediateormatureonmostoftheindicators.Theoriginalplanwasthatin2015allorganisationswouldachievethematurephase.Progressispromisingand,asaresult,thegoalmaybeachievedonetotwoyearsearlier.

Solidaridad network organisation development

Legallyestablished

Governancethroughsupervisoryboard

FinancialManagement

ISO9001:2008certified

ROMISManagementInformation

Results-BasedManagement

HRMqualitysystems

Fundraisingcapacity


SolidaridadAndes






SolidaridadChina

SolidaridadTheNetherlands

SolidaridadNorthAmerica

Startup Intermediate Mature Established


that go with them. The functions are also weighted on thebasisofthefollowingfourcharacteristics:

− knowledgeandexperience− independence− socialskillsand− risks,responsibilityandinfluence.

Solidaridad’s wages policy follows that of the Dutch govern-ment. Where necessary, management may award a labourmarket premium. The Director is paid according to scale 16,two staff are on scale 13, four on scale 12, eighteen on scale11, four on scale 10, four on scale 9 and two on scale 7. Theother conditions of employment are based on the Status ofEmployees Regulations, but legal provision always prevailsovertheStatusofEmployeesRegulations.

PerSonnel PoliCy

Solidaridad is a knowledge-intensive organisation thatdepends on well-qualified staff. Its staff must be involved,motivated, innovative and customer-oriented. This is whySolidaridaddevotesalotofattentiontorecruitmentandwhythere is ample opportunity and a budget for career devel-opment. Education and career development are discussedat every performance evaluation interview. Employees canapply to further their education, and internal courses areorganised.Solidaridadalsohasatrainingplanthatcoverstheentireorganisation,whichisevaluatedeveryyear. The goal of the diversity policy is that Solidaridad’s staff

shouldreflecttheDutchpopulationinsofarasthisispossible.Solidaridad has 23 female and 12 male employees. Theiraverageageis40years.Threeemployeesleftin2012,andtennew employees were welcomed. The rate of absence due tosicknessislow,at0.7%in2012(in2011:1.7%).

enVironMent

Solidaridad minimises the impact of its work on the envi-ronment as far as possible, by reusing items, by purchasingsustainable products (office items with a green label, energyefficient equipment, green energy, organic lunches andsustainablyproducedcoffeeandtea),byseparatingitswastepaperforrecycling,andbymakingdouble-sidedprintingandcopyingthenorm.

aCCountability StateMent

Solidaridad presents an accountability statement, showinghow it gives effect to the following principles of the CBFqualitymark:1. separationoffunctionsbetweensupervision,management

andimplementation2. optimisingeffectivenessandefficiencyofspendingand3. optimisingrelationshipswithinterestedorganisations.

The accountability statement, which was approved bythe Director and the chair of the Supervisory Board on ispresentedbelow.

Thefullstatementcanbeorderedfromthesecretariat


FinanCial rePort

balanCe Sheet on 31 deCeMber 2012

(ineurosandafterallocationofsurpluses)Thecompleteannualaccountsareavailableonrequestfromthesecretariat.

aSSetS 2012 2011

tangible fixed assets 45,327 59,195

financial fixed assets 562,868 567,525

608,195 626,720

receivables, prepayments and accrued income 1,320,485 866,925

Stocks and shares 517,544 471,843

Cash and bank balances 13,616,219 9,184,323

15,454,248 10,523,091

total assets 16,062,443 11,149,811

liabilitieS

reserves and funds

Reserves

–Continuityreserve 4,178,434 4,234,852

–Reservesforfinancingoperationalassets 45,327 59,195

–Reservesforfinancingassetstomeetourobjectives 562,868 –

4,786,629 4,294,047

Designatedfunds

–Designatedfundforparticipatinginterests – 567,525

–DesignatedfundforHaiti 682,826 720,501

682,826 1,288,026

5,469,455 5,582,073

long-term debts – –

Short-term debts 10,592,988 5,567,738

total liabilities 16,062,443 11,149,811

general noteS to the aCCountS

guidelines for annual reporting TheannualaccountshavebeendrawnupinaccordancewiththeGuidelineforFundraisingInstitutions(Richtlijn Fondsenwervende instellingen: Richtlijn 650),whichispartoftheaccountingstandardsproducedbytheDutchAccountingStandardsBoard(Raad voor de Jaarverslaggeving).

foreign currenciesAssetsandliabilitiesinforeigncurrencyhavebeenconvertedattheexchangeratesonthebalancesheetdate.Itemsinthestatementofincomeandexpenditurehavebeenconvertedtoeurosusingtheexchangerateatthetimeofthetransaction.


StateMent of inCoMe and exPenditure for�2012

(ineuros)

inCoMe actual 2012 Budget2012 Actual2011

Incomefromownfundraising 4,144,817 3,135,000 4,734,759

Incomefromtheactivitiesofthirdparties 1,894,905 920,000 929,143

Governmentsubsidies 12,607,803 10,935,000 8,850,674

Interestandincomefrominvestments 486,800 150,000 382,655

Otherincome – – 208,186

Totalincome 19,134,325 15,140,000 15,105,417

exPenditure

expenditure on achieving our objectives

Awarenessraising 646,116 316,000 341,336

Structuralaid 17,885,868 14,466,600 14,018,860

18,531,984 14,782,600 14,360,196

income generation

Costsofownfundraising 391,425 398,000 347,391

Costsofthird-partyactivities 16,835 9,400 –

Costsofobtaininggovernmentsubsidies 176,216 204,000 164,752

Investmentcosts – – –

584,476 611,400 512,143

Management and administration

Costsofmanagementandadministration 130,483 146,000 124,730

Totalexpenditure 19,246,943 15,540,000 14,997,069

reSult –�112,618 –�400,000 108,348

allocation of surpluses

Continuityreserve – 56,418 – 79,874

Reservesforfinancingoperationalassets – 13,868 – – 20,553

Reservesforfinancingassetstomeetourobjectives – 4,657 – 147,175

DesignatedfundforHaiti – 37,675 – – 98,148

reSult –�112,618 – 108,348

aCCounting PoliCieS for Valuation and deterMination of the reSult

tangible fixed assetsTheoperatingassetsarevaluedatpurchasepricelessannualstraight-linedepreciationbasedontheexpectedusefuleconomiclife.Purchasesmadeinthereportingyeararedepreciatedfromthedateofpurchase.

financial fixed assetsAdvancepaymentsandloansarevaluedattheirnominalvalue,takingintoaccountanyriskthattheymaynotbecollectible.ParticipationsthatdonotenableSolidaridadtoexerciseasignificantinfluenceoncommercialandfinancialpoliciesarevaluedatpurchasepriceafterdeductingexceptionaldepreciationswhereapplicable.Non-consolidatedparticipationsoverwhichsignificantinfluencecanbeexercisedarevaluedattheirshareinthenetequityvalueaccordingtotheaccountingpoliciesfortheseannualaccounts.

receivablesReceivablesarevaluedattheirnominalvalue,takingintoaccountanyriskthattheymaynotbecollectible.

Stocks and sharesInvestmentslistedonthestockexchangeandotherinvestmentsarevaluedattheirmarketvalue.Realizedandunrealizedpricegainsandlossesareenteredintothestatementofincomeandexpenditure.


other assets and liabilitiesAllotheritemsinthebalancesheetarevaluedattheirnominalvalue.

income and expenditureIncomeisaccountedforintheyeartowhichitrelates.Expenditureisdeterminedwithdueregardtotheaccountingpoliciesforvaluationdescribedaboveandisallocatedtotheaccountingyeartowhichitrelates.Lossesareaccountedforintheyearinwhichtheycanbeanticipated.Incomefrominheritancesisaccountedforinthefirstyearinwhichthesizeoftheinheritancecanbereliablyestablished.

analySiS of the reSultS for 2012 in CoMPariSon to 2011 and the budget for 2012

Solidaridad’sfinancialresultsfor2012indicateasuccessfulyear.Totalincomewas€ 19,134,325–thehighestever.Incomefromourownfundraisingdeclinedby€ 590,000comparedtolastyear’sresult,butwas€ 1,010,000higherthanbudgeted,chieflybecauseoftheincreaseindonationsfromcompaniesandotherorganisations.Incomefromsubsidiesincreasedby€ 3,757,000,ascomparedto2011andwas€ 1,673,000higherthanbudgetbecauseofnewsubsidiesapprovedin2012.Totalincomein2012was€4,029,000higherthanin2011.Spendingin2012was€ 4,250,000higherthanin2011.€4,172,000ofthiswasdirectspendingonourobjectives.Allofthesefluctuationsledtoashortfallof€ 112,618inthestatementofincomeandexpenditurein2012 (2011:€ 108,348).

€ 13,868hasbeendrawnfromreservesforfinancingoperationalassets,€ 4,657fromreservesforfinancingassetstomeetourobjectives,and€ 37,675fromthedesignatedfundforHaiti.Thebalancetobedrawnfromthecontinuityreservesin2012is€ 56,418.Thisislessthanthebudgetedshortfallof€ 400,000.

historical summaryThetablebelowshowsthefinancialresultsforthepastfiveyears(ineuros).

inCoMe 2012 2011 2010 2009 2008

Incomefromownfundraising 4,144,817 4,734,759 4,057,959 3,734,673 4,350,492

Otherincome 14,989,508 10,370,658 14,782,563 11,086,303 8,261,818

total income 19,134,325 15,105,417 18,840,522 14,820,976 12,612,310

exPenditure

Awarenessraising 646,116 341,336 323,009 360,716 647,733

Structuralaid 17,885,868 14,018,860 17,278,214 13,305,948 10,385,654

Totalexpenditureonobjectives 18,531,984 14,360,196 17,601,223 13,666,664 11,033,387

Totalcostsofincomegeneration 584,476 512,143 600,963 515,072 512,762

Managementandadministrativecosts 130,483 124,730 164,465 149,832 145,956

total expenditure 19,246,943 14,997,069 18,366,651 14,331,568 11,692,105

Surplus –�112,618 108,348 473,871 489,408 920,205

Policy on assets and investmentsSolidaridadspends€18.5milliononfinancingprojects.Thesefundscomefrommanydifferentsources,includinggovernmentcontributionsaswellasdonationsfromindividuals,companiesandinstitutions.Solidaridadhasanassetbufferof€ 4,178,434tocoveranyunexpectedlargefallinincome.Iffundingisreceivedandcannotimmediatelybeusefullydeployedinsupportofourobjectives–sinceittakestimetoprepareandimplementprojects–thesefundsaretemporarilyinvested.Solidaridad’spartners,suppliersandstaffneedtobesurethatSolidaridadwillalwaysbeabletomeetitsliabilitiesanddonorsandotherfundingbodiesmustbeconfidentthatthemoneytheydonatetoSolidaridadisinsafehands.ItisthereforeextremelyimportantthatSolidaridad’sassetsaremanagedresponsibly.Investmentruleshavebeendrawnuptoensurethatthisisthecase.TheserulesalsostipulatethatSolidaridadwillcomplywiththeGuidelinesonCharityReservespreparedbytheDutchAssociationofFundraisingOrganisations(VFI).Inviewofthelimitedvolumeandcomplexityoftheportfolio,Solidaridadhasdecidedtomanageitsassetsinternallytoreducecosts.

Byfarmostoftheassetbufferisinvestedinsavingsdepositswithsociallyresponsiblebanks,suchasASNBankandTriodosBank.InlinewithSolidaridad’sobjectives,about€0.5millionoftheassetbufferisinvestedinfundsmanagedbybankscommittedtopromotingamoresustainablesociety.Theseinvestmentfundsaremanagedbythebankstoensureanoptimumspreadofrisk.Thehistoricalsummaryonthenextpageshowsthechangesinthecapitalvalueoftheseinvestments.


2012 2011 2010 2009 2008

ValueonJanuary1 455,433 476,208 436,373 382,120 490,112

Purchases – – – – –

Reinvesteddividend 3,473 3,289 5,128 5,164 3,961

Pricegain/loss 42,128 – 24,064 34,707 49,089 – 111,953

ValueonDecember31 501,034 455,433 476,208 436,373 382,120

Cashdividendreceived 6,564 8,759 13,462 14,928 13,845

Investmentcosts – – – – –

Themostrecentpurchasesweremadein2001andnosaleshavebeenmadeduringthepastfiveyears.PartlyasaconsequenceofthecreditcrisisintheNetherlands,thefundlostnearlyaquarterofitsvaluebyyear-end2008,butrecoveredtoacertainextentin2009and2010.Thisrecoverydidnotcontinuein2011,butresumedin2012.Theaveragereturnoninvestmentoverthepastfiveyearsisabout2.8%peryear.

Solidaridad’sworkingcapitalisheldinsavingsaccountswithsociallyresponsiblebanks,suchasASNBankandTriodosBank.

Bydesignatingfundsasreserves,theSupervisoryBoardindicateshowtheyintendtoemploytheresourcesavailabletothem.Solidaridadhasdesignatedacontinuityreserve,areserveforfinancingoperationalassetsandareserveforfinancingassetstomeetourobjectives.

Thecontinuityreserveisintendedtocovershort-termrisksandtoensurethatSolidaridadcancontinuetomeetitsmoralandotherobligations.Solidaridadbasesitselfontheconceptofsustainablerelationshipswithitspartnersandwithitsstaff.Thesizeofthecontinuityreserveisdeterminedasatrade-offbetweenthedesirabilityofdeployingasmuchaspossibleofourresourcesforourobjectivesandtheneedtomaintainahealthyfinancialbasisforthefuture.WeareguidedinthisdecisionbytheGuidelinesonCharityReservespreparedbytheDutchAssociationofFundraisingOrganisations(VFI),theassociationofnationalfundraisingcharitiesintheNetherlands.TheGuidelinesonCharityReservesstatethat:

− areservationofresourcesisdesirableforthecontinuityofthesupportgiventothecharity’sgoals;− thecontinuityreserveshouldbenomorethan1.5timestheannualcostsofmaintainingtheoperationalstructure.

ThecostsformaintainingSolidaridad’soperationalstructurein2012were€2,572,057(2011:€2,194,454).Attheendof2012,thecontinuityreserveamountedto€4,178,434,i.e.1.6timestheannualcostsofmaintainingtheoperationalstructure(2011:1.9).Inthe2013budgetapprovedbytheSupervisoryBoard,thesecostsare€2,795,000andashortfallof€1,000,000isthereforeforecast.Thisshortfallwillbecoveredfromthecontinuityreserve,whichisexpectedtoreducetheratioto1.1timestheannualcostsofmaintainingtheoperationalstructureattheendof2013.Inviewofthisexpectedshortfall,andtheexpectedgrowthofSolidaridad’soperationalstructurein2013,Solidaridadconsidersitprudentthatthecontinuityreserveattheendof2012wasmorethan1.5timesthesecosts,asrecommendedbytheCentralBureauonFundraising(CBF).

key figuresTheDutchCentralBureauonFundraising(CBF)considersthecostsoftheorganisation’sownfundraising–asapercentageoftheincomefromitsownfundraising–tobeanimportantwaytoevaluatewhetherafundraisinginstitutionisworthyofsupport.Thisindicatorshowstheproportionoftheproceedsfromfundraisingthatareusedtogeneratethesefunds.Solidaridadaimsfora(reasonably)stableproportionofbetweentenandfifteenpercent,unlessitcanbedemonstratedthataninvestmentinfundraisingwillgeneratesufficientadditionalincomeinthefuture.Thetablebelowshowstheincomeandcostsandtherelevantpercentagesforthepastfiveyears.Inallcasesthepercentageiswellbelowthemaximumof25percentsetbytheCBF.

2012 2011 2010 2009 2008


Costsofownfundraising 391,425 347,391 367,001 357,039 405,930

Costs as a percentage of income from own fundraising 9.4 % 7.3 % 9.0 % 9.6 % 9.3 %

TheCBFrecommendscalculatingtworatiosrelatedtospending:theratioofspendingontheorganisation’sobjectivestoitstotalincome,andtheratioofitsspendingtoitstotalexpenditure.Solidaridadstrivestoachievethehighestpossiblespendingratiowithoutendangeringthequalityofimplementationoftheprojects.TheCBFhasnotsetaminimumratio,becausethispercentagedependstoagreatextentonthetypeoforganisation.ThetablebelowshowstheamountsSolidaridadspentonitsobjectives,andtheresultingspendingratios,forthepastfiveyears.


2012 2011 2010 2009 2008

Amountspentdirectlyonobjectives 16,455,773 12,609,873 15,575,753 11,392,908 9,408,612

Totalincome 19,134,325 15,105,417 18,840,522 14,820,976 11,688,710

Spending ratio (income) 86.0 % 83.5 % 82.7 % 76.9 % 80.5 %

2012 2011 2010 2009 2008

Amountspentdirectlyonobjectives 16,455,773 12,609,873 15,575,753 11,392,908 9,408,612

Totalexpenditure 19,246,943 14,997,069 18,366,651 14,331,568 11,692,105

Spending ratio (expenditure) 85.5 % 84.1 % 84.8 % 79.5 % 80.5 %

budget for 2013 and for future yearsThebudgetfor2013hasbeendrawnupinthelightoftheobjectivesandprioritiessetoutintheStrategicPlanfor2011-2015(anddetailedintheannualplanfor2013)andthelong-termbudgetfor2013-2017hasbeenmodifiedaccordingly.

The2013budgetwasadoptedinthemeetingoftheSupervisoryBoardheldon11December2012.Theincomeandexpenditurestatementforthisbudgetissummarisedbelow(ineuros).

inCoMe budget 2013 Budget2012

Incomefromownfundraising 2,622,000 3,135,000

Incomefromthird-partyactivities 1,897,000 920,000

Governmentsubsidies 11,328,000 10,935,000

Interestandincomefrominvestments 250,000 150,000

Totalincome 16,097,000 15,140,000

exPenditure

Expenditureonachievingourobjectives

Awarenessraising 367,000 316,000

Structuralaid 15,938,000 14,466,600

16,305,000 14,782,600

Costs of acquiring income

Costsofownfundraising 442,000 398,000

Costsofthird-partyactivities 18,000 9,400

Costsofobtaininggovernmentsubsidies 198,000 204,000

Costsofinvestments – –

658,000 611,400

Management and administration

Managementandadministrationcosts 134,000 146,000

total expenditure 17,097,000 15,540,000

result –�1,000,000 –�400,000

Theamountsshowninthisbudgetforcontributionsfromgovernments,companies,otherorganisationsandcharitablefoundations–aswellastheincomefromthird-partyactivities–arebasedonsigneddonorcontracts.Theriskthatthisbudgetwillnotbeachievedislimitedtotheextenttowhichthesepartiesmaynotmeettheircontractualobligations.Itisexpectedthatsupplementarycommitmentswillbemadeduring2013andthatthebudgetwillthereforebeexceeded.Therevenuesfromchurchcollections,mailings,deceasedestatesandinterestreceivedarebudgetedonthebasisofhistoricvalues,takingcurrentdevelopmentsandtrendsintoaccount.Thesesourcesofincomearemonitoredonamonthlybasissothatadjustmentscanbemadeifnecessary.

Theexpectedexpendituresincludeallexpenditurerelatingtocommittedprogrammefundingandanestimateofincidentalcosts.ItisimportantthatwemaintainourpresentstafflevelsintheNetherlandsandoverseas,sothatweareabletoimplementourinnovativeprogrammeinthebestwaypossibleandmakethemostofthemanypotentialsourcesinfunding.Solidaridadhassufficientuncommittedreservestocovertheshortagebudgetedfor2013.


Thecurrentgrowthinincomeisexpectedtocontinue.Increasesareexpectedfromvarioussources.Theadditionalincomewillbespentalmostentirelyonmeetingourobjectives.Thelong-termbudgetbelowshowstheconsequencesoftheseexpectations.

inCoMe 2013 2014 2015 2016 2017


Otherincome 13,475,000 14,000,000 15,000,000 16,000,000 16,500,000

total income 16,097,000 17,000,000 18,000,000 19,000,000 20,000,000

exPenditure

Awarenessraising 367,000 370,000 375,000 400,000 450,000

Structuralaid 15,938,000 15,835,000 16,820,000 17,770,000 18,695,000

Totalexpenditureonobjectives 16,305,000 16,205,000 17,195,000 18,170,000 19,145,000

Totalcostsofincomegeneration 658,000 660,000 665,000 680,000 700,000

Managementandadministrationcosts 134,000 135,000 140,000 150,000 155,000

total expenditure 17,097,000 17,000,000 18,000,000 19,000,000 20,000,000

Result –�1,000,000 – – – –

CaSh floW StateMent for 2012

(ineuros)

2012 2011

Cashflowfromoperationalactivities

Surplusfromthestatementofincomeandexpenditure – 112,618 108,348

Depreciation 31,184 30,792

Changesinworkingcapital:

–short-termreceivables – 453,560 957,408

–short-termdebts 5,025,250 – 53,362

4,490,256 1,043,186

Cash flow from investment activities

Investmentsintangiblefixedassets – 17,316 – 10,239

Changesinfinancialfixedassets 4,657 – 147,175

Changesinstocksandshares – 45,701 20,575

– 58,360 – 136,839

Cash flow from financing activities

Changesinlong-termdebts – – 45,378

Changes in cash and bank balances 4,431,896 860,969

Cash and bank balances

Balanceon1January 9,184,323 8,323,354

Balanceon31December 13,616,219 9,184,323

Changes in cash and bank balances 4,431,896 860,969

Thecashflowstatementhasbeendrawnupusingtheindirectmethod.Thecashandbankbalancesattheendof2012were€4.4millionhigherthanattheendof2011.Themostimportantchangeisthat€6.9millioninfundingforusein2013wasreceivedduring2012.Thisis€3.8millionmorethanin2011.Itisreportedundershort-termdebts.Short-termdebtsalsoinclude€1.2millionmorethanin2011tocoverthefinalpaymentsoncontractswithourpartners.Short-termreceivablesinclude€1.0millionintheoutstandingfinaltrancheoffundingforprojects.Thisis€350,000morethanin2011.


SPeCifiCation and breakdoWn of CoStS by CategorieS

Thetablebelowshowsthelevelandcompositionofthecosts.

Objectives Incomegeneration Managementand

administration

total 2012 Budget2012 Total2011

expenditure Structuralaid Awarenessraising

Fundraising Third-partyactivities

Subsidies Investments

Contributionstoprojects

16,012,650 – – – – – – 16,012,650 12,435,000 12,439,299

Communication – 443,123 219,113 – – – – 662,236 370,000 363,316

Staff 1,542,728 167,178 141,911 13,865 145,127 – 107,462 2,118,271 2,215,000 1,738,063

Travelandaccommodation

105,165 11,396 9,674 945 9,893 – 7,326 144,399 150,000 126,591

Premises 95,271 10,325 8,764 856 8,962 – 6,636 130,814 162,500 166,573

Officeandgeneral

107,343 11,632 9,874 965 10,098 – 7,477 147,389 172,500 132,435

Depreciation 22,711 2,462 2,089 204 2,136 – 1,582 31,184 35,000 30,792

17,885,868 646,116 391,425 16,835 176,216 – 130,483 19,246,943 15,540,000 14,997,069

explanation of cost allocationOperatingcostsareallocatedtothevariouscostcategories.Thecalculationmethodfor2012isthesameasthatusedin2011.Thejobdescriptionsforeachmemberofstaffareusedtodeterminewhichpartsoftheirworkrelatetothevariouscategories.Thegeneraloverheadsarethenallocatedusingthesamepercentagedistributionasforthestaffcosts.

Management and administrationAsin2011,themanagementandadministrationcostsincludethefollowingpersonnelcosts:Director,0.2FTE;secretariat,0.25FTE;Controller,0.33FTE(includingthePersonnelDepartmentandinternalaffairs);Administrator0.4FTE;andthePlanning,Monitoring,Evaluationofficer,0.1FTE.Solidaridadstrivestoachievethelowestpossiblepercentageofmanagementandadministrativecostswithoutendangeringthequalityofitsoperations.Apercentageofbetweenoneandtwopercentoftotalcostsisconsideredtobeahealthyproportion.

number of staff membersDuringthe2012fiscalyear,theaveragenumberofstaffmembersemployedbySolidaridad–expressedasfull-timeequivalents(FTEs)–was28.9(2011:23.7).


auditor’S rePort

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solidaridad network

We operate as a global netWork of regional expertise centres

solidaridad netWork

international secretariat’t Goylaan 15 ,3525 AA Utrecht, the NetherlandsTel +31(0)30 275 94 [email protected]

solidaridad continental foundations

solidaridad network asiaHong KongContact via Solidaridad South and Southeast Asia

solidaridad network latin america (Fundación Solidaridad Latino America)Panama City, PanamaContact via Solidaridad South America

solidaridad network africaNairobi, KenyaContact via Solidaridad Eastern and Central Africa

solidaridad regional expertise centres

solidaridad south americaFederico Lacroze 1820, 1er Piso Depto A y B, Ciudad Autónoma de Buenos Aires, CP: 1426, ArgentinaTel +54 11 47750741

Country office:• Brazil, São PauloContact via Solidaridad South America

solidaridad andesAv. Roosevelt Nº 5866, MirafloresLima 18, PerúTel +51 1 4454242

solidaridad central america15 Avenida 13-45, Zona 10, OaklandGuatemala Ciudad, GuatemalaTel +502 2366-5856 (ext. 115)

solidaridad West africaHse No. 40 Sir Arku Korsah Road, Airport West, Accra, GhanaTel +233 (0)302 733129

Country offices:• Ivory Coast, Abidjan• Cameroun, Yaounde• Nigeria, AkureContact via Solidaridad West Africa

solidaridad southern africa105 Oxford Road, SaxonwoldPO Box 87286, Houghton 2041Johannesburg, South AfricaTel +27-11-7887952

solidaridad eastern and central africaKilimani Business Centre, Kirichwa Road, off Argwings Kodhek RoadP.O. Box 675-0618, Ruaraka, Nairobi, KenyaTel +254 (0) 716 666 862

solidaridad south and south-east asia1st Floor, A-5, Shankar GardenMain Najafgarh Road, Vikas PuriNew Delhi – 110018, IndiaTel +91 (11) 2551 5122 / 3

Country offices:• Bangladesh, Dhaka• Indonesia (in formation;

foreseen for May 2013, West Java)

Contact via Solidaridad South and South-East Asia

solidaridad chinaRoom 1407, Building A, New World Plaza, Chongwen DistrictBeijing 100062, ChinaTel +86 10 6708 9110

solidaridad the netherlands’t Goylaan 15, 3525 AA Utrecht,the NetherlandsTel +31 (0)30 2720313

solidaridad north america (in formation) 3180 18th Street, Suite 205 San Francisco, CA 94110, USA Tel +1 415 449 9906 Mobile +1 415-812-8012

solidaridad north america San Francisco, US

solidaridad central americaGuatemala Ciudad, Guatemala

solidaridad the netherlandsUtrecht, the Netherlands

solidaridad eastern and central africaNairobi, Kenya

solidaridad chinaBeijing, China

solidaridad south and south-east asiaNew Delhi, India

solidaridad southern africaJohannesburg, South Africa

solidaridad West africaAccra, Ghana

solidaridad andesLima, Peru

solidaridad south americaCiudad Autónoma de Buenos Aires, Argentina

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glossary

Agency NL Dutch GO working on sustainability, innovation and international businessBCI Better Cotton InitiativeBonsucro Global sugar-cane RoundtableBSCI Business Social Compliance InitiativeCIDIN Centre for International Development Issues NijmegenCSO Civil Society OrganisationDEG Deutsche Investitions und EntwicklungsgesellschaftETP Ethical Tea PartnershipECOM A global trading/processing company specialising in coffee, cotton, and cocoaFTFM Fairtrade and Fairmined goldGRSB Global Roundtable Sustainable BeefHivos A Dutch NGO engaged in sustainability, social innovation and knowledge sharingIDH International Sustainable Trade InitiativeOECD Organisation for Economic Co-operation and Development PROCASO Program of Sustainable Quality (Honduras) REDD+ Reducing Emissions from Deforestation and Forest DegradationRJC Responsible Jewellery Council goldRSPO Roundtable on Sustainable Palm Oil RTRS Round Table on Responsible Soy AssociationSNV International NGO with an emphasis on reducing poverty Utz From Utz Kapeh, meaning ‘Good Coffee’ in the Mayan language QuicheWWF World Wildlife Fund

sugar-cane cutter in nicaragua

Cane cutting provides millions of people with an income. It is one of the most demanding jobs there is. Cane cutters work from dusk to dawn in air that is thick with ashes from pre-harvest burning, working in temperatures up to 40 degrees C. It is also dangerous work, and many cane cutters are trapped in a cycle of poverty and health problems for generations.

People like this sugar-cane cutter form the basis of the growing global business in sugar and ethanol, a business that is diversifying into automotive fuels and plastics, as sugar cane is increasingly used to replace oil. Yet, in many countries, the valuable contribution of sugar-cane cutters is not reflected in decent working conditions and an income that can help them break the cycle of poverty.

Solidaridad is working throughout South America, Africa and Asia to improve the position of sugar-cane cutters, by making them aware of their rights, building up their skills, working with their employers and governments to secure compliance with labour laws. We cooperate with well-known brands and Bonsucro, the global sugar-cane roundtable, to source responsibly. In 2013 Solidaridad will launch an international campaign to engage consumers and companies alike, encouraging them to make their contribution to changing the world of sugar cane.

You can support our work with a donation:Solidaridad’t Goylaan 153525 AA UtrechtThe NetherlandsIBAN: NL45 RABO 0129 9111 51BIC/SWIFT: RABONL2U

change that matterswww.solidaridadnetwork.org www.solidaridad.nl

Photo: Piet den Blanken

Solidaridad the Netherlands 2012 Annual Report

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Transcript of Solidaridad the Netherlands 2012 Annual Report