Quarterly Return 88

QUARTERLY RETURN 88 Summer 2013

The Impact of Social Investment in Fair Trade

“Bringing light to darkness”

“The Golden Grain of the Andes”

A full review of our most recent members’ event

News from longstanding customer Namayiana

Learn more about the superfood, quinoa

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Welcome Hopefully the sun is shining as you receive this Summer issue of QR. This quarter we are asking for your help. As you can see on the back page, we are looking for individuals to join our Board and Council. We are also looking for suggestions of groups and networks that we can join to help increase our presence and membership across the UK. If you are able to help with any of the above please get in touch.

We have lots of great new lending stories for you in this issue. These range from new loans to increased facilities for longstanding customers.

It is positive to see so many of our customers continuing their relationship with Shared Interest.

Some of you may have seen in the press that The Co-operative Bank, where we deposit our Share Capital, has been downgraded by Moody’s. The full statement from the group regarding the downgrade can be found below.

Following the success of our member events in Edinburgh and Oxford we hosted an ethical debate in Brighton to celebrate World Fair Trade Day in May. Thank you to all of our speakers and supporters who made the event a great success. A full summary of the debate can be found on page three.

In other good news we are delighted to announce that we came away as winners of the Guardian Sustainable Business Awards and have since been named as regional finalists of the Private Business Awards and have been shortlisted for Newcastle’s Culture for Success awards.

Patricia Alexander, Managing Director

The Co-operative Banking Group Statement on Moody’s Downgrade You may have picked up on Moody’s recent downgrade of The Co-operative Bank. The group has issued the following response to the downgrade:

Sustainable Business Award

“We are disappointed by the ratings downgrade announced by Moody’s. We have a strong funding profile and high levels of liquidity, which are significantly above the regulatory requirements.

“We do acknowledge, like the rest of our banking sector peers, the need to strengthen our capital position in light of the broader economic downturn and the pending introduction of enhanced regulatory requirements, and we have a clear plan to drive this forward throughout the coming months.

In March, we announced the sale of our life business to Royal London and also our intention to sell our general insurance business. In addition to these measures we plan to significantly simplify our business, which will greatly improve our operational effectiveness and also enhance our capital position in the process.

“Our banking business is already characterised by excellent levels of customer service and advocacy, as recently highlighted in reports by YouGov and uSwitch.

Our primary current account base in recent years has enjoyed significant growth. The actions we will now take to strengthen our balance sheet and simplify our business model around a core relationship banking offer, will create a compelling co-operative banking business which is truly distinctive within the banking sector.” Since releasing this statement The Co-operative Group has announced the outcome of a review of its capital position. You can find this statement at:

Shared Interest Board Member, David Nussbaum accepts the Guardian Sustainable Business Award.

Now in their third year, the Guardian Sustainable Business Awards set out to reward innovation and impact in sustainable business.

We were delighted to receive the award and to be included in the Guardian’s Sustainable Business Network.

Photo by Anna Gordon

www.co-operativebank.co.uk/customerservices/announcements/recentannouncements/outcome-of-review-june-2013

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Front cover photo: Handcraft producer from women’s group, Namayiana

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The impact of

social investment on fair trade In celebration of World Fair Trade Day 2013 we travelled to Brighton to hold a discussion and networking event with our members and guests in the region.

We were joined by three panellists to discuss the impact of social investment in fair trade. Sally Smith, an independent research consultant, spoke of the need for producers to have greater support for strengthening their organisations and improved financial support to increase the positive impact of fair trade.

Simon Maxwell followed and described Shared Interest and our members as ‘pioneering and courageous’ in recognising that trade is vital for development. Simon, former Director at the Overseas Development Institute, challenged the audience to consider how fair trade can be scaled up sustainably and effectively. We also heard from Shared Interest Board member, Martin Kyndt who detailed how Shared Interest works to address the challenge of access to finance and highlighted the recent achievements of the Society.

Following the observations from the panel, a lively discussion ensued where questions and comments were openly debated. One member asked why Shared Interest does not operate in Asia.

This is due to local government rules restricting investment into and out of the country which make it impossible to lend in India, Bangladesh, Pakistan and Nepal. We do however; make payments to numerous fair trade producers across the region through the facilities that our fair trade buyers hold with us.

Another member asked about the importance of enabling fair trade producers to add value to their products. It was agreed that this is something to be encouraged as it could bring new opportunities to producers to maximise the impact of fair trade.

Conversations, questions and debate continued over Fairtrade refreshments alongside stalls from a number of our partners in the area including the Brighton and Hove Fairtrade Group, FAIR (a local Fairtrade shop) and The Co-operative. With live updates to social media channels we were also able to share the event beyond the venue. You can learn more about the speakers and the event at www.shared-interest.com/events. We are currently planning our next event with partners and this will take place in Cardiff in October, keep an eye on our website for more details.

events Visit www.shared-interest.com/events for up-to-date information on all upcoming events.

Scottish Fairtrade Forum – Campaign Day - Saturday 7 September, Perth The Forum will be hosting a national event to celebrate Scotland’s achievement of Fair Trade Nation status.

See www.scottishfairtradeforum.org for updates.

Fairtrade Supporters Conference - Saturday 5 October, London Look out for further information at www.fairtrade.org.uk

Make Your Money Count - Saturday 12 October, Bristol Shared Interest will be returning to this event to highlight ethical investment options during National Ethical Investment Week.

Keep an eye on www.shared-interest.com/events for further details.

Finance: What’s faith got to do with it? - Putting your money to work ethically - Saturday 26 October, Cardiff In partnership with ECCR, Church in Wales and Fair Trade Wales, we will return to Wales to meet members and others interested in exploring ethical finance, fair trade and faith.

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Liberation!

Liberation is proud to be the UK’s first and only 100% Fairtrade nut company. Formed by TWIN Trading and Equal Exchange - two of the organisations behind Fairtrade hot drinks brand Cafédirect - Liberation Foods was set up in 2007 to help nut farmers in the developing world work their way to a better future for themselves and their families by selling their harvest overseas under Fairtrade terms.

Now working with over 22,000 farmers in Malawi, Mozambique, Nicaragua, El Salvador, Bolivia, Peru, Brazil and India, Liberation helps these farming communities to bring their peanuts, cashews and brazil nuts to supermarkets across the UK. Going one step further, Liberation is also partially owned by its nut producers. 44% of the organisation’s shares are held by the producer co-operatives that supply the nuts.

Liberation Board Member from the COINACAPA brazil nut gatherers co-operative in Bolivia Casildo Quispe said: “Before Fairtrade, people used to work for the traders and there was a lot of exploitation. After each harvest, producers would end up in debt and each year they were working to pay off the previous year’s debt.

“When we started campaigning for the formation of Liberation we all started feeling hopeful of the results and the potential impact in our lives.

“My fellow producers never thought they would own a company. This is very new to us. We have never before attended these kinds of meetings or been involved in making these kinds of decisions.

“With the Fairtrade premium we give health insurance to our members, which means people can go to hospital whenever they need to. Part of the premium will also be used to buy tools like machetes, shovels and bags for producers and some for books,

notebooks, clothes and uniforms for children to go to school. These are the benefits of fair trade and our co-operative and that is why producers want to sell their nuts to us and join our co-operative and why we want to sell to Liberation.”

Shared Interest started working with Liberation in 2007 and has supported its growth over the last six years, particularly by providing credit to help secure large Christmas orders.

This year, Liberation are thrilled to announce that they will be re-launching their brand and increasing their product range. Managing Director of Liberation, Kate Gaskell told us: “We’ve come up with some exciting new recipes for our Liberation lines including Fairtrade Chilli and Lime Cashews with Peanuts and Roasted Corn. Selling high quality and great tasting nuts has always our priority. All of our nuts are handpicked by the members of the small-scale farmer’s cooperatives who co-own Liberation.

They take pride in owning their own company; this pride in owning their own brand is reflected in the high quality nuts we produce” The benefits to marginalised farmers are most effectively expressed by the farmers and their representatives.

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Global Fairtrade Week As part of Global Fairtrade Week the World Fair Trade Organization (WFTO) held its 12th biennial conference and AGM in Rio de Janeiro, Brazil.

Rio was named the global fair trade capital for the week as many fair trade networks from around the world were holding concurrent meetings.

“Most farmers are poor people, life is hard,” says Ana Katrina, who works with the Del Campo nut farming co-operative in Nicaragua, helping to export peanuts to the UK. “Working alone farmers can’t sell, but together they have support. Liberation can teach people how to bring their product to market and show them an easier way to survive. I want more farmers to be able to join Del Campo and Liberation so they can sell what they grow at Fairtrade prices. I’d like to see people living without having to struggle.”

Tomy Mathews from India’s Fair Trade Alliance Kerala (FTAK), explained why accessing the Fairtrade market through Liberation has been such a lifeline to the cashew nut farmers he represents. He said: “The Fairtrade premium is very important to us. At monsoon time there are landslides, which can wreak havoc in the hillsides. The Government aid can often be delayed and is always inadequate. What we need is immediate assistance to help those rendered homeless, with their crops destroyed. We are planning to put aside a disaster fund created through the money we have received from the Fairtrade premium.”

For more information on Liberation visit www.chooseliberation.com

Entitled ‘The Next Generation of Fair Trade’, the conference discussed the future of fair trade and in particular the implementation of WFTO’s own fair trade guarantee system. The AGM is the main decision making body and all resolutions were passed, including the vital decision to increase membership fees to cover the costs of the new guarantee system.

Shared Interest was well represented at the event. Customer Services Manager, Malcolm Curtis met with other WFTO Global Board Members beforehand to finalise details of the AGM and Regional Development Executive, Paul Sablich also attended. Shared Interest Board member, Carol Wills presented feedback to members on the results of the pilots for the guarantee system which she had co-ordinated.

Malcolm said: “It was great to discuss the different guarantee systems with all of the other networks and the conference was an excellent opportunity to raise the profile of WFTO on a global level.”

The next biennial conference will be in Milan in 2015 and a formal handover of the Global Fair Trade Week ‘baton’ was made to the Mayor of Milan by representatives of the Mayor of Rio de Janeiro.

Can you help raise our profile?

We are always looking for new ways to raise awareness of Shared Interest.

Currently our staff and ambassadors promote the Society by attending events, hosting stalls and speaking to potential new members.

Can you help? If you know of any groups, events or meetings where Shared Interest could give a presentation, run a stall or distribute literature please do get in touch at info@shared-interest.com or call us on 0191 233 9103.

We are quite a small team so we may not be able to support every opportunity but all suggestions are welcome.

Alternatively if you are interested in joining our Ambassador scheme and promoting Shared Interest within your local community we would also love to hear from you.

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Building a F

for Intercraf

Founded in 1992, Intercrafts Peru was set up specifically to co-ordinate the export of goods from handcraft producers across the country. The group is dedicated to improving the living conditions of all members and their families.

Intercrafts is made up of 19 different groups, representing over 400 individuals and their families.

The groups make a variety of different products from vases and mirrors to jewellery, cards, clothing and Christmas decorations. The patterns used on the products are traditionally handcrafted to help preserve the rich Peruvian culture that they represent.

Shared Interest has worked with Intercrafts since 1999 when we provided a loan to enable the group to purchase the land needed to construct their own premises. Unfortunately due to the nature of Peruvian building regulations, the group was not able to go ahead with their plans so they found an alternative use for he funds before repaying their loan in full.

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a Future

crafts Peru

Explaining Term Loans We offer producer groups Term Loans for the purchase of assets such as machinery, buildings or vehicles. Loans vary in length between one and five years and repayments are set depending upon the circumstances of the producer group. Loan sizes are determined by the financial situation of the producer group and their ability to repay.

After many years of battling the building regulations and other unforeseen circumstances, in 2011 we were able to provide Intercrafts with a second Term Loan, which they have successfully used to construct their official premises.

The group are thrilled to finally have their own space to work and develop their business. General Manager Moner Lizana told us: “Having our own offices has been a long dream for Intercrafts. For nearly 20 years we have been wandering from one place to another, with consequent costs in the rental of premises and insecurity of not having a fixed place. With the growth of the organisation our members had dispersed to three premises.

“With the help of Shared Interest and the Term Loan they provided, we were able to carry out the construction of the premises. We feel the security of being in our own home, with the amenities that this new office offers to workers and craftsmen.

“The leaders, artisans and workers feel happy and proud to own a nice office, while it provides safety and security to our customers. For all this we are grateful to Shared Interest because thanks to the Term Loan we could make our dream come true.”

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“Bringing Light

to Darkness”

Those of you that are long-term Shared Interest investors will no doubt recognise longstanding customer Namayiana, whose name means “blessed” in the Maasai language.

Since Namayiana was established in 1996, the road has not always been a straight one for the group. Initially they struggled with product development, given the size of their staff team and diversity of talent.

The Kenyan handcraft market is also competitive and Namayiana has had to work hard to secure the right partners. Beaded products in particular are a popular source of income and Namayiana is aware that they may have to broaden their product offering to remain financially viable. However, as a self-help group, their success runs a great deal deeper than product margins and the welfare of staff is key. Knowledge and skills are passed down through generations and the group uphold their traditions with pride.

Project Manager, Catherine Mututua told us: “Before Namayiana existed there was no real role for women in the local community and no source of income but now they can pay for their children’s education, as well as buy food, clothing and other household items.”

Namayiana and Shared Interest have been working together since 2009. As well as helping to develop their business though a credit facility, we provided funding for the women to attend the Africa Days Vienna Exhibition in July 2010. The exhibition was a huge success for the group as they sold all of the products they took with them and secured a number of future orders.

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The exhibition also gave them inspiration for new design ideas and alternative ways to raise additional income for their members.

Our biggest impact, however, has to be through the Term Loan that enabled the group to install electricity to their facilities. Catherine told us: “Electricity has been a dream for many years. We have seen electricity in towns but never thought there will be power in Maasai land. Shared Interest made it a true reality, really true. Now we have it and the greatest impact it has brought is being able to have many phones being charged and people stay connected all the time.”

She continued: “Before you will have to walk or use transport to go to a town not near to charge a phone with a cost. It is now so easy with power at the centre. By having power, everywhere is lightened and we have many working hours with power, so we feel more secure. Having this electricity has made us have other thoughts of new projects that are badly needed by many in the community.”

All images on pages 8-9 by Ian McClelland Photography

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Despite the successful installation of electricity, Namayiana is now facing the rising cost of raw materials such as beads, leather, wire and buckles.

For example a pack of three beads that once cost 950 Kenyan Shillings, now costs 1,600 Shillings.

The group has approached us for a further loan that will allow them to buy raw materials in bulk.

This will secure the stock and the colours that they need, and will protect the group from further price increases.

We asked Catherine if Namayiana had a message for Shared Interest’s supporters. She told us: “It is hard to get the right wording and way to express our deep heart feelings for Shared Interest. We receive great support from them and we see them as pillars for development.

They have brought light where there has been darkness, change in so many ways - in education, clothing, shelter and healthcare.

We thank you again for the interest and support you have given to Namayiana Maasai women group, the Maasai community, and the country of Kenya at large.”

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25/06/2013 16:05:55

The Golden Grain of the andes

The United Nations (UN) has declared 2013 as “The International Year of Quinoa” (IYQ) in recognition of the indigenous peoples of the Andes, who have maintained, controlled, protected and preserved quinoa as a food for present and future generations.

The UN recognises the global need to identify crops that can be grown in a context of progressive climate change to help improve food security across the globe.

Quinoa is a native grain that has been cultivated in South America for 5,000 years. The hardy plant has adapted to the harsh environmental conditions in which it grows and has become resistant to drought, low temperatures and poor soils.

As well as being relatively easy to grow, quinoa is one of the most nutritionally-balanced crops around. It is a good source of high quality protein and it contains all eight essential amino acids. It is rich in the vitamins Thiamin1, Riboflavin2, and Niacin3 and the minerals Iron, Magnesium, Phosphorus and Potassium. It also contains zero cholesterol. Due to its incredibly high nutritional value, quinoa has become known locally as the “golden grain of the Andes”.

The world’s main producers of quinoa are Bolivia, Ecuador and Peru. Shared Interest supports these producers by lending to fair trade buyers Andean Naturals and GoGo Quinoa. Their Shared Interest facilities enable these organisations to pre-finance their orders from farmers in South America, helping them to access the working capital they need to grow their crops.

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GoGo Quinoa is a Canadian buyer based in Ville-Emard, Montreal. The organisation was founded in 2007 by Martin Bilodeau as an “ethical business dedicated to the promotion of organic food and fair trade practice.”

The organisation sources quinoa from farmer groups Coronillá ltda and Anapquí in Bolivia and from FUNDAMYF in Ecuador. They use the grain to create over 30 products that are available in over 500 health food shops across Canada and the United States.

GoGo Quinoa has been a Shared Interest customer since 2008, their Account Manager, Edwin Anarcaya said: “As the demand for GoGo’s products continues to rise, we have agreed to increase their credit facility to help them cope with this demand. As their need for quinoa increases, GoGo needs access to more funds to be able to make advance payments to their fair trade suppliers in Bolivia and Ecuador to secure the necessary stock. We are delighted to be able to continue our support of GoGo Quinoa and of course the farmers in Latin America that our funds assist.”

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New lending Cepibo We recently approved a new Term Loan for Peruvian banana producers, CEPIBO. The group repaid a previous loan earlier this year and are now looking to build new infrastructure such as packing centres, cableway and water wells. It is hoped that these improvements will increase their production and efficiency, which ultimately means better prices for the farmer members.

Acproboquea As with CEPIBO we have approved a term loan facility for Peruvian banana producers, Acproboquea . This will enable the group to invest in infrastructure to help them become more efficient when collecting and packing their bananas.

Other benefits include a reduction in costs and increases in the farmers’ income. The planned infrastructure includes a new warehouse, a palletising and packing centre and a cold store as well as cableway and a truck.

Fairtrade Furniture Our most recent buyer credit facility has been approved for The Fair Trade Furniture Company. This UK-based organisation works predominantly with producer groups in Indonesia to develop and market conservatory furniture.

Fair Trade Furniture works with their producer partners to develop the products, helping them understand the designs and European quality requirements and to adapt their carpentry and weaving skills to enable them to fulfil the potential of the designs.

Spotlight on the Environment Climate Change and Food Security As well as guaranteeing prices and decent working conditions, the fair trade movement encourages environmentally sustainable practices from farmers and workers across the globe.

For instance, Shared Interest recently helped Chilean co-operative Apicoop to diversify their product range from honey to become the world’s first producer of Fairtrade blueberries.

Here at Shared Interest, by only working with organisations that are fair trade certified, we know that we support organisations dedicated to creating sustainable businesses and communities, and meet robust environmental standards in doing so.

Apicoop General Manager, Chino Henriquez said: “It is simple. If we didn’t have access to Shared Interest’s finance we wouldn’t be here now talking about blueberries.

Our role is helping fair trade businesses trade in a sustainable way and part of this is being mindful of issues such as climate change and food security.

These factors can drastically affect businesses in certain parts of the world, and our lending can help them continue to trade, often by diversifying into other products.

“We really want Shared Interest members to understand how much impact their investment has.

Although they can’t see or touch our blueberry field, it has been worth it and will continue to benefit future generations.”

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Members survey 2013

Board Vacancy

Please find enclosed your copy of the 2013 members’ survey, which will form part of our Social Accounts.

We are seeking to recruit a new Non-Executive Director to join our Board as a vacancy has arisen due to retirement.

The survey is your opportunity to express your thoughts as a Shared Interest investor, and help to impact on our future decisions.

This is an exciting opportunity to assist our very special organisation by providing strategic direction, guidance and support. Members and others with empathy for working with an organisation such as Shared Interest are invited to apply.

Please complete and return this to Membership Survey, Shared Interest FREEPOST NT 1883, Newcastle upon Tyne, NE1 1BR. If you would prefer to complete the survey online please email survey@shared-interest. com with ‘ONLINE SURVEY REQUEST’ in the subject line. We will then send you a link and instructions on how to access the survey.

All responses must be received by Friday, 16 August 2013.

We are looking for candidates with an understanding or experience of governance and skills in the following area: • International Development – Trade Related If you, or anyone you know, are interested in this opportunity, please contact Margaret Woodhouse for further information on 0191 233 9138 or email margaret.woodhouse@shared-interest.com Closing Date for applications: Thursday, 29 August 2013.

Election of Council member Council – a voice for members in the governance of Shared Interest.

In accordance with the Society’s rules one nonrandom member of Council retires each year on the basis of rotation and we are holding elections for a member to sit on Council from March 2014.

If you would like to contribute to the Society’s governance by being on Council, then you are invited to put yourself forward for election.

Council meets three times a year (and members attend the AGM). The maximum term of service is six years.

Requests for more information should be sent to Tim Morgan, Company Secretary, at the Society’s office or e-mail tim.morgan@shared-interest.com

Contact us Shared Interest 2 Cathedral Square Groat Market Newcastle upon Tyne NE1 1EH 0191 233 9102 membership@shared-interest.com

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Welcome to those of you who have already signed up to our Secure Area. We hope you are enjoying the benefits of managing your Share Account online.

If you forget your Login details or password, you can reset these by clicking the ‘Forgotten Password’ link on the Login screen itself.

For security reasons, your password needs to be eight characters, with at least one upper case letter, one lower case letter and one number.

If you have any questions or feedback, please email securearea@shared-interest.com

The Moderators of Council will be happy to discuss Council membership with candidates.

The closing date for applications is Sunday, 15 September 2013.

Secure area update

Members who would like to sign up to the Secure Area should email with their name and the last four digits of their Share Account Number and we will get you started.

Quarterly Return is the newsletter of Shared Interest.

Shared Interest Society Ltd is a fair trade lending organisation which is a member of Co-operatives UK. It uses the pooled investments of its members in the UK to effect real and lasting improvements to people’s lives in the developing world.

QR is printed on paper from sustainable, well managed sources certified by the Forest Stewardship Council.

Shared Interest Society Ltd is registered with the Registrar of Friendly Societies, number 27093R. The Directors decide on what the interest amount will be, if any, after the end of the financial year when financial results for the past year are known.

From 1 October 2011 the interest rate has been 0.5%.

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