IDH Annual Report 2017

In 2017, IDH executed the second year of its 2020 strategic plan. We invested in the Sustainable Development Goals, by driving innovative business models for sustainable trade. We invested in 11 global supply chains, 12 landscapes and 50 Value Chain Projects. We reached over 2.5 million farmers with services to improve sustainable productivity and quality whilst reducing their environmental footprint. We are on track in our effort to transform markets through changing business practices, improving sector governance and improving field level sustainability. Key results in 2017 include:

Service Delivery Models & Innovative Finance
In 2017 IDH invested and orchestrated scalable and viable service delivery in cocoa, tea coffee, cotton, fruits & vegetables, cashew, flowers and palm oil. We were able to make significant progress in smallholders’ profitability by prototyping financial arrangements and by increasing the profitability of farmers. In the Farm and Cocoa Investment Program we combined investing in effective service delivery models (SDMs) with financial arrangements to bring capital and organizational knowledge to cooperatives, creating improved livelihoods for 150,000 farmers in Côte d’Ivoire. We also struck a deal between ABN AMRO, IDH and the Neumann Kaffee Gruppe, which will double coffee incomes of farmers in Uganda in 2 years. A deal in which ABN AMRO provides USD 9 million-dollar funding, and IDH provides a first loss guarantee up to year 5, as part of a sustainable sourcing strategy from Neumann Kaffee Gruppe (NKG), the world’s largest coffee trader. We shared our insights through a learning publication: Driving Innovations in Smallholder Engagement. We tested our key insights against senior executives from trade, retail, banking and development finance, in a one-day workshop in Amsterdam that was attended by the UN Secretary-General’s Special Advocate for Inclusive Finance for Development, H.M. Queen Máxima. In our Fresh and Ingredients programs over 47,000 farmers were trained with an average adoption rate of 71%.

PPI compacts & the andgreen.fund
In twelve tropical deforestation hotspots in Indonesia, Brazil, Vietnam, Kenya, Liberia, Côte d’Ivoire and Ghana, IDH made good progress with establishing multi-stakeholder governance and first pilots on the ground with promising results. Leveraging zero deforestation commitments of palm oil, soy, cocoa, tropical timber, pulp & paper and beef companies, we formed landscape per landscape public private partnerships with local governments and CSOs. The coalitions have the power and mandate to create economic and policy incentives for sustainable production of agro-commodities and forestry products. With the aim of protecting and restoring forests and peatlands, and enhance communities’ livelihoods. This Production, Protection, Inclusion (PPI) approach gained in 2017 strong traction amongst companies, governments and CSO’s. In January 2017 we were able to incorporate and launch the andgreen.fund at WEF Davos together with the Norwegian government and supported by multiple partners including Unilever. With a potential 400 million conditional de-risking capital, the andgreen.fund expects to trigger 1.6 billion USD of private sector investments to protect 5 million hectares of tropical forests and peatlands by 2022.
Together with the World Cocoa Foundation (WCF) and the International Sustainability Unit of the Prince of Wales (ISU), IDH launched a multi-stakeholder coalition of over 20 cocoa companies in March 2017 to halt deforestation in Ghana and Côte d’Ivoire.  After the launch in Buckingham Palace, IDH managed to co-convene in only eight months a joint framework of action between the governments of Ghana and Cote D’Ivoire and 26 cocoa companies that was signed at COP22 in November 2017. The joint framework takes the IDH approach of Production, Protection and Inclusion to reduce deforestation, inspired by (e.g.) our landscape approach in the Cavally region in Côte d’Ivoire.

Operational excellence
In 2017 we further strengthened and diversified the IDH partnership base in line with the 2016-2020 strategy. We are proud to have extended the partnership with Denmark as institutional donor until 2020. Also, we are equally pleased to have contracted a second phase in the landscape program with Norway, after a successful inception year. On a regional level, we have entered into funding relations with Dutch embassies in Mozambique and Rwanda, on respectively smallholder farmer resilience and inclusion into cotton and horticulture supply chains. The UK government provided funding through its Partnership for Forests program for our convening work for the Cocoa and Forest Initiative. We work with the US government on Vanilla in Madagascar (in a partnership with ILO), and on Apparel in our Race to the Top Program in Vietnam. Finally, we entered into a partnership with the Rockefeller Foundation in the context of our Grow Africa program, aiming at improving food security, strengthening smallholder integration in industrial cassava supply chains. Next to these new funding relations, we deepened our partnership with AGRA on the African continent and expanded our pioneering SDM work with the Bill and Melinda Gates Foundation. In cooperation with the World Economic Forum’s New Vision on Agriculture, IDH helps drive actionable public-private partnership platforms in Vietnam, Indonesia, India and Colombia

We invested in the rigor of our program design and implementation, through our proof of concept methodology that ties outputs, outcomes and impacts together in a logical and measurable way. And further sharpened our intervention logics of our landscape programs, in consultation with our donor partners. Last but not least we developed a new stakeholder survey that provides us with critical insights on the effectiveness of our convening role.

Joost Oorthuizen
Steven Collet
IDH Executive Board