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Published on 12/12/2012

Nutri’zaza: A Social Business Combating Malnutrition in Madagascar

December 2012

For 14 years, GRET has been fighting early childhood malnutrition in Madagascar by educating mothers and distributing infant flours through the hotelin-jazakely restaurants for babies. On September 26, 2012, the founding general assembly was held for the social company Nutri’zaza, created by GRET and four other shareholders to manage the chain of restaurants for babies. This was an important step toward ensuring the sustainability of these actions and guaranteeing that they continue to fight poverty.

 

14 Years Fighting Malnutrition in Madagascar

In Madagascar, nearly one out of every two children are malnourished. The cause: the poor quality of the food they receive, notably in disadvantaged households (inadequate breastfeeding practices, complementary foods that are nutritionally very lacking). In 1998, GRET, IRD and the University of Antananarivo came together in the framework of the Nutrimad project to design effective methods to fight malnutrition in Madagascar. They conceived a strategy aiming notably to disseminate a high quality complementary food to the largest number; such complementary foods are indispensable to supplement breastmilk starting when the child is six months old. The strategy is built around three pillars:

  • Awareness-raising and nutrition education for families by neighborhood organizers with prior training.
  • The development of a complementary food of high nutritional quality: Koba Aina. This flour is made from local ingredients (with the exception of vitamins and minerals) by the company Taf.
  • The creation of an original distribution network: restaurants for babies, the hotelin-jazakely. Organizers there prepare and sell gruel made from Koba Aina.

Since the first hotely opened in 2000, 15 million meals have been distributed. Over time, with the acquired experience (including two years of collaboration with Danone that enabled us to improve sales techniques) and the resources obtained to work for these populations, it has been possible to progressively develop the network of hotelin-jazakely and improve how they operate. In the space of a few years, it became obvious that this offer fit a long-term need among families and needed to be made sustainable. In 2008, after several years of reflection and attempts to make the restaurants sustainable in the communities in the form of an association of organizers, the status of company seemed to be the most appropriate and most viable model. And thus the Nutri’zaza social company was born.

Nutri’zaza: Betting on a Social Company

With four partners, Taf (the Koba Aina manufacturer), APEM (a local association), and two French investment funds, I&P and SIDI, GRET elaborated the procedures necessary to create Nutri’zaza. As a limited company under Malagasy law, Nutri’zaza adopted the three pillars of the Nutrimad project and is managing and developing the hotelin-jazakely network. A five-year business plan was written, and financial balance is possible for a network of roughly one hundred hotely. Nutri’zaza’s creation received start-up funds from the Agence Française de Développement and capital investments from five shareholders.
In addition to the standard governance for limited companies (management, board of directors, general assembly of shareholders), the company will create, with the support of the FIND innovation for development fund, an ethics and social oversight committee so that administration of its social mandate is not left to the shareholders alone. After the risk of not attaining the expected financial balance targets, the largest risk facing Nutri’zaza would be drifting away from its status as a social company and becoming a classic commercial company that would no longer benefit the most disadvantaged people and instead would have the main and only goal of turning a profit. Thus, it is crucial to adopt an organizational form that ensures the continued pursuit of this social mandate even if the shareholders change over time. This committee will be composed of former partners in Nutrimad, including the communes, who provide the land on which the hotelin-jazakely are built or premises to renovate free of charge, the National Nutrition Office, and the Ministry of Health. It will meet twice a year to monitor the company’s social indicators: number of children reached, number of meals provided, affordability of Koba Aina for the poorest (product sale price), number of organizer jobs created, number of nutrition education sessions conducted, etc. All these indicators will be covered in a white paper so that they can be monitored over the long term.

Challenges for the Coming Five Years

For the next five years, a vast amount of work is waiting for Nutri’zaza, as the company must attain financial balance and prove that it is fulfilling its social mandate:

  • convince the former partners that even though the status has changed, the goal of fighting malnutrition remains intact in order to maintain Nutrimad’s support of the Nutri’zaza social company and encourage them participate in the ethics and social oversight committee;
  • build 60 new hotely in poor areas in the space of three years;
  • set up shop in 25 new communes;
  • extend sales of Koba Aina to other distribution circuits;
  • provide complementary foods to more than 150,000 children (and notably children from poor families);
  • create 200 organizer jobs; and
  • win the bet that a company can be socially beneficial (with services that are affordable for low-income families, working mainly with poor families, maintaining product compliance with international quality standards, etc.) and prove this through rigorous indicators.

More informations : See the study (in French)  Étude et travaux en ligne : “Le business social pour lutter contre la malnutrition infantile : l’élaboration d’un service de vente d’aliments pour jeunes enfants à Madagascar (1997-2008)”