Sappi Khulisa: Creating Shared Value
DOING GOOD WHILE DOING BUSINESS
The Sappi Khulisa programme has successfully uplifted many impoverished communities in Southern Africa, creating shared value for the company and for the participants in the programme with many growers benefiting financially over the years. The programme also received a Silver Loerie Award in the Shared Value category in 2021.
HOW THE PROGRAMME STARTED
As a leading global provider of everyday materials made from woodfibre-based renewable resources, Sappi Southern Africa relies on woodfibre sourced from sustainably managed plantations to service our mills in Southern Africa. We use mostly the timber grown in our own plantations, but we supplement this supply with timber procured from the Sappi Khulisa programme.
It’s a win-win situation: Tree-farming has high barriers to entry, because of the initial costs involved. Sappi Khulisa opens up the avenues of participation to rural subsistence farmers and communities, benefiting them in terms of skills and income, helping to turn them and their contractors into more self-reliant, sustainable timber businesses and professional forestry value chain participants. In the process, Sappi helps to build thriving communities but also secures a quality fibre supply going forward.
Sappi Khulisa started out in 1983 with only three small growers and has grown to over 3,600 growers. The total area managed under this scheme is currently 34,755 hectares and since 1995, a total volume of 4,731,488 tons of woodfibre to the value of ZAR2.9 billion has been purchased from small growers under this programme.
HOW THE PROGRAMME WORKS
Growers make their land available for planting eucalyptus trees and Sappi provides seedlings supplied from our own nurseries to ensure that only the best available quality genetic material is planted. Sappi’s team of qualified extension officers provide guidance on best practices with regards to technical advice on a range of topics, including planting, weeding, harvesting, fire and pest control.
Free training is offered to all value chain participants – including land reform beneficiaries – at Sappi’s three Khulisa Ulwazi Training Centres in KwaZulu-Natal, and covers all aspects of forestry, including core operational skills as well as safety, legal and environmental compliance and business management. In consultation with the INR (Institute of Natural Resources) 15 modules of training material were developed to address the need for greater technical know-how as well as entrepreneurial skills.
Loans are provided to cover all farming input costs, including annual maintenance of the plantations until they are harvested. Advances are paid to growers for work carried out throughout the generally 8-10 year growing cycle. At harvesting time, we buy the timber from the growers and pay them a market-related price less the advance payments they have received in preceding years.
A Mobile App has been developed and implemented to assist the foresters with providing an effective extension and development service to the growers, where all transactions are done directly on their mobile phones, which links with the different management systems in Sappi, while a Grower Mobile App gives the grower direct access to plantation information, contracts, financial information and the Ulwazi training material.