Engro merges business with social responsibility

Teaming up with USAID, helps farmers recover from the flood.

KARACHI:

Engro Corporation’s Khushaal Livestock Programme – designed to help farmers improve the productivity of their dairy animals in the aftermath of the flood – is a rare case of a Pakistani company successfully merging its business interests with its corporate social responsibility initiatives.

The six month programme which ended last month was run by the company’s non-profit arm Engro Foundation, utilised funding from the United States Agency for International Development (USAID) to provide Rs78 million in micro-grants to farmers in order to help them increase milk production of their dairy animals by an average of half a litre per animal per day.

Assistance included vaccination for the animals from foot and mouth disease and other veterinary services, fertilisers, multi-cut grass seeds, oat seeds, mineral mixtures and other nutritional supplements to help restore the health and productivity of the livestock affected by the most devastating floods in the country’s history.

“Engro Foundation takes special pride in our role in the Khushaal Livestock Project. As part of our continuing efforts to assist farmers in Sindh, we will continue to work with USAID to provide market linkages, technical and advisory support, training, and capacity development to dairy farmers,” said Tahir Jawaid, the company spokesperson.

Yet while Engro conducted the programme as part of its corporate social responsibility initiative, Khushaal Livestock just happens to be good for business.

One of Engro’s fastest growing business lines is Engro Foods, a consumer goods company that is particularly focused on dairy products. The company’s brand of packaged milk, Olpers, has been steadily gaining market share since its launch in 2006 and is already the market leader in several parts of the country, rapidly gaining on its rival, Nestle Pakistan, the local subsidiary of the global food giant.

Engro Foods’ success has relied upon developing a highly sophisticated supply chain (managed through a subsidiary known as Engro Supply Chain Company). The company has 750 milk collection centres across the country, which includes a network of chilled milk tankers that cut down on wastage (as high as 40% nationwide), building an advantage that has all but destroyed its old rival, Haleeb Foods.

When the floods hit, that extensive supply chain came under threat and Engro sought to protect the farmers from whom it buys its milk. The company utilised its own extensive resources, and worked with USAID, in order to run a programme that would ensure that the animals that survived the flood would not succumb to disease and would have access to high quality feed to increase both the quantity and quality of the milk.

As Khushaal Livestock came to a close in May, it had helped 22,000 dairy farming households in Larkana and Dadu districts in Sindh, directly impacting the health of 95,386 animals, according to the company’s CSR report.

The successful collaboration with Engro on the project has led the USAID to agree to another two-and-a-half-year project that would also be focused on improving the dairy supply chain in southern Punjab and northern Sindh.

Published in The Express Tribune, June 9^th, 2011.