Kuapa Kokoo is a large cooperative of cocoa farmers in Ghana. It is democratically owned and managed and farmers have a direct say in the management of the Divine Chocolate company, and offers its members a variety of capacity-building programs.
Problems and Purpose
The cocoa and chocolate industry is dominated by a few multi-national companies which control distribution. Kuapa Kokoo and Divine Chocolate offer an alternative model: cooperative ownership.[1] Kuapa Kokoo’s main work focusses on collecting and marketing cocoa harvests and negotiating higher prices for its farmers. It is currently the largest Fairtrade-certified cocoa cooperative worldwide, representing over 100,000 members with a total population of 500,000 in 6 regions of Ghana.[2] With the help of Twin and other supporters, Kuapa Kokoo set up the Divine Chocolate company in which it owns the majority of shares. Kuapa Kokoo members are directly involved in the management of the Divine company, getting direct decision-making power over the marketing of their chocolate and access to the profits from its sales.[3]
Background History and Context
Kuapa Kokoo was formed in 1993 after the Ghanaian government liberalized the cacao market.[4]
Organizing, Supporting, and Funding Entities
Divine Chocolate is based in the UK and owned by Kuapa Kokoo (45 percent), Twin, and a Oikocredit.[5] Divine Chocolate provides wealth generation for the cooperative’s farmers due to the firm's efforts in growing the market for fair-trade - thereby increasing the percentage of Kuapa Kokoo harvest sold at fair-trade prices - and through direct dividend payments. Two percent of company’s annual turnover is invested in Kuapa Kokoo’s programmes (e.g. training and capacity building for women).[6]
Participant Recruitment Selection
The board of Divine has two farmer representatives democratically elected by their farmer members on a biannual basis. Other members include Twin, Oikocredit, Comic Relief, Christian Aid (each with 1 seat) and 5 board members with a range of commercial expertise, including both the Managing Director and Finance Director of Divine Chocolate.[7]
Methods and Tools
Kuapa Kokoo is itself democratically and cooperatively owned and managed.[8] As well, because it owns the majority of shares in Divine Chocolate, its members are directly involved in company management, allowing farmers to market their own chocolate and profit from its sales. Divine Chocolate’s business strategy relies on fair-trade: educating chocolate consumers and retailers on fair-trade and raising willingness to pay a premium covering the higher cost of the beans.[9] Kuapa Kokoo provides various programs to its members such as telemedicine, training in agro-forestry, and women’s empowerment and capacity building. [10]
What Went on: Process, Interaction, and Participation
The farmer-owned cooperative created the space for farmers to actively participate in the cocoa value chain. The cooperative specifically targets small farmers with a focus on women (approx. 30% of members).[11] Representatives to the Board of Divine Chocolate are elected and get direct say over the company’s management. Cooperative members also get access to Kuapa Kokoo programmes including training and capacity-building, and can obtain credit for farm maintenance and community projects from the proceeds of the producer organization.[12]
According to its website, “Kuapa Kokoo is a truly democratic organization. The Union operates a 3 tier governance structure with the Zonal Executive Committee (ZEC) at the community level; Society Executive Council (SEC) at the District level and National Executive Council (NEC) who are elected by a National Assembly to formulate policies at the National level. In 2015, the Union adopted a new structure to strengthen farmer commitment, ownership and transparency as well as to further deepen grass root participation in decision making.”[13]
Influence, Outcomes, and Effects
As of 2016, Kuapa Kokoo’s ownership share of Divine Chocolate has resulted in £2 million invested in schools, water wells, and medical clinics throughout Ghana. In addition, the direct relationship with a UK based fair-trade chocolate company provides Kuapa Kokoo with knowledge assets as it gets direct exposure to the chocolate industry and direct insights into strategic planning and marketing. According to the Fairtrade Foundation, “The projects undertaken by Kuapa Kokoo have helped the farmers, especially the women, empower themselves, build confidence and independence, and ensure a sense of community participation and ownership.”[14]
Analysis and Lessons Learned
Tensions arise from the challenge of acquiring and maintaining sustainable resource streams without losing the legitimacy that accompanies the social objectives. Conflict between NGO and commercial board members has arisen with regard to levels of commercial activity versus the need to bolster financial benefits to farmers; intensified by increased competition from new Fairtrade products (e.g. supermarket own-label with price discounting). There are concerns about supply chain risk due to over reliance on Kuapa Kokoo as a supplier (but difficult to diversify due to Kuapa’s key role in decision-making). A more practical challenge has been the volume of Board documents, with Kuapa Kokoo board members stating a preference for more verbal communication.[15]
See Also
References
[1] Perter Jack Gallo, Raquel Antolin-Lopez, Ivan Montiel, “Associative Sustainable Business Models: Cases in the bean-to-bar chocolate industry,” Journal of Cleaner Production 174, (2018), 906, https://www.sciencedirect.com/science/article/pii/S0959652617326720?via%3Dihub.
[2] “Projects,” Kuapa Kokoo, accessed April 9, 2019, https://www.kuapakokoo.com/index.php/our-projects/.
[3] “Inside Divine,” Divine Chocolate, accessed April 9, 2019, http://www.divinechocolate.com/uk/about-us/inside-divine.
[4] Gideon E. Onumah, Junior R. Davis, Ulrich Kleih and Felicity J. Proctor, Empowering Smallholder Farmers in Markets: Changing Agricultural Marketing Systems and Innovative Responses by Producer Organizations (Online: ESFIM Working Paper, 2007), 19, https://www.researchgate.net/publication/47522286_Empowering_Smallholder_Farmers_in_Markets_Changing_agricultural_marketing_systems_and_innovative_responses_by_producer_organizations.
[5] “Inside Divine,” http://www.divinechocolate.com/uk/about-us/inside-divine.
[6] “Press Release: Farmer-Owned, Women-Led Divine Chocolate Celebrates 10 Years of Success in U.S. Market,” Divine Chocolate, March 23, 2017, http://www.divinechocolate.com/us/good-stuff/news/2017/3/press-release-farmer-owned-women-led-divine-chocolate-celebrates-10-years.
[7] “Inside Divine,” http://www.divinechocolate.com/uk/about-us/inside-divine.
[8] “Structure,” Kuapa Kokoo, accessed April 9, 2019, https://www.kuapakokoo.com/index.php/structure/.
[9] “Kuapa Kokoo, Ghana,” http://www.fairtrade.org.uk/Farmers-and-Workers/Cocoa/Kuapa-Kokoo.
[10] “Press Release: Farmer-Owned, Women-Led Divine Chocolate Celebrates 10 Years of Success in U.S. Market,” http://www.divinechocolate.com/us/good-stuff/news/2017/3/press-release-farmer-owned-women-led-divine-chocolate-celebrates-10-years
[11] “Kuapa Kokoo, Ghana,” http://www.fairtrade.org.uk/Farmers-and-Workers/Cocoa/Kuapa-Kokoo.
[12] Onumah, Davis, Kleih and Proctor, Empowering Smallholder Farmers in Markets, 20.
[13] “Structure,” https://www.kuapakokoo.com/index.php/structure/.
[14] “Kuapa Kokoo, Ghana,” Fairtrade Foundation, accessed April 9, 2019, http://www.fairtrade.org.uk/Farmers-and-Workers/Cocoa/Kuapa-Kokoo.
[15] Chris Mason and Bob Doherty, “A Fair Trade-off? Paradoxes in the Governance of Fair-trade Social Enterprises,” Journal of Business Ethics, 136, no. 3 (July 2016), https://link.springer.com/article/10.1007/s10551-014-2511-2
External Links
Official Website: https://www.kuapakokoo.com/
Notes
Lead image: Divine Chocolate, “Members of Margret's women’s group showing off their crop of aubergines from the communal farm” http://bit.ly/2D3j8HW
The first submission of this Participedia entry was adapted from a research project by the Institute of Development Studies, 'Linking Participation and Economic Advancement’ licensed and reproduced under Creative Commons (CC BY 3.0).
Original source: https://www.eldis.org/keyissues/mapping-participation-economic-advancement