Social Business: Gitanjali Cooperative
Waste Pickers ... The very poor in India

The Gitanjali Cooperative: A Social Enterprise in the Making (brief)

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Peter Burgess

The cover of the Gitanjali Cooperative: A Social Enterprise in the Making BRIEFS

The Gitanjali Cooperative: A Social Enterprise in the Making (brief) 9/15/17 Mayra Buvinic , Tanvi Jaluka and Megan O'Donnell

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The full case study is available here.

In 1995 India’s Self-Employed Women’s Association (SEWA) organized women waste pickers in Ahmedabad into a cooperative to improve their working conditions and livelihoods. When the waste recycling industry collapsed eight years later, eroding waste pickers’ already vulnerable income, the cooperative began to manufacture stationery products from recycled waste. Over time, this informal arrangement evolved into Gitanjali—a women-owned and -run social enterprise. With support from key partners, Gitanjali has generated social value, providing its members with safe and dignified work while increasing their earnings. While Gitanjali faces challenges in becoming a fully self-sufficient social enterprise, its experience offers insights for other initiatives seeking to provide opportunities for women to transition from informal to formal work.

CGD-sewa-gitanjali-cooperative-social-enterprise-making.pdf

CGD-sewa-gitanjali-cooperative-social-enterprise-making-brief.pdf


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10/23/2017

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CHAPTER 1 OF 15 | TABLE OF CONTENTS

Introduction

In 1995 the Self-Employed Women’s Association (SEWA) organized women waste pickers in the city of Ahmedabad into a cooperative to improve their working conditions and livelihoods. In 2008 the waste recycling industry crashed internationally (a direct consequence of the global financial crisis) and prices of scrap dropped drastically, by almost half. Waste pickers’ incomes shrank as result of the crash, and the city’s decision to privatize door-to-door waste collection further deteriorated their income earning options. In response, the cooperative decided to set up a production unit to manufacture value-added products made from recycled waste. This is a case study of the growth and evolution of this informal producers’ unit into a women-owned and -run social enterprise, including the role of members (“sisters”) and external partners. The case study also explores the social value that this enterprise—Gitanjali—appears to have generated, as well as the business bottom line. It concludes by identifying challenges and lessons learned, and provides recommendations for the cooperative’s future.

Background Improving Informal Work Photo of three Gitanjali sisters working Gitanjali sisters assemble notebooks and folders

India has the highest percentage of informal workers in the economies of the Asia region. Informal employment accounts for 84 percent of total nonagricultural employment, with roughly equal numbers of female (85 percent) and male workers (83 percent). The majority of these workers are employed in highly vulnerable jobs with variable and low pay, limited access to social protection, denial of labor rights, and lack of organization and representation (Vanek et al. 2013). Many are self-employed (home-based producers, street vendors, and waste pickers), while others are domestic workers or casual day laborers, or work for piece-rate under subcontracts. Women are overrepresented in the lowest paid, most vulnerable jobs, including waste picking. In urban India, 0.2 percent of women informal workers and 0.1 percent of men informal workers are waste pickers (Vanek et al. op cit).

Women are overrepresented in the lowest paid, most vulnerable jobs, including waste picking

Attempted solutions to improve informal employment include, first, organizing informal sector workers by occupation/trade to enable collective bargaining and improve work conditions; second, integrating informal workers into formal sector jobs with expansion of wage and salary work; and, third, transforming the occupational choices of informal workers by enabling access to capital, resources, and technology.

SEWA’s core work addresses the first set of solutions and is described in more detail later in this case study. The second set presupposes the growth of wage employment in industries linked to global markets that can absorb women workers, especially in low-skilled jobs in light manufacturing. Until recently, this has been cited as a preferred solution for women in informal jobs. The common view has been that female subsistence-level producers and entrepreneurs in particular will be better off when they can integrate into jobs generated by mass hiring, as the industrial sector grows. Partly, this is because a large proportion of poor women are “necessity” rather than “opportunity” entrepreneurs, who turn to self-employment to provide subsistence income for themselves or their families because no other jobs are available (Schoar 2010; Calderon et al. 2016). Growth of the export-oriented apparel industry in Bangladesh is often cited as an example of expansion of job opportunities for women through wage work that can result in virtuous cycles where enhanced labor earnings for women stimulate increased schooling for girls, increased age at marriage, and reduced fertility (World Bank 2013). But overall improvement in women’s employment depends on the work conditions in these industries, as noted in numerous recent media reports that have exposed hazardous work conditions in some apparel factories in Bangladesh (Kamat 2016; Bain and Avins 2015).

New evidence from Ethiopia, which is undergoing rapid industrial sector growth, suggests that encouraging self-employment with cash grants and promoting entrepreneurship may lead to better economic outcomes for poor women when compared with jobs in manufacturing, at least jobs that do not offer higher wages and can expose workers to health risks. The study contrasted the results a year later of applicants who obtained low-skilled entry-level jobs in export-oriented light industries with applicants who were offered business training (five-day class training plus individual mentoring) and a cash grant (US$300) to stimulate self-employment and with a control group, and found that wages were significantly higher only for those in self-employment. Workers who took industrial jobs did not earn higher wages than controls, were exposed to health risks at the workplace, and frequently quit their jobs. Eighty percent of applicants were female (Blattman and Dercon 2016).

New evidence suggests that encouraging self-employment with cash grants and promoting entrepreneurship may lead to better economic outcomes for poor women when compared with jobs in manufacturing

Additional evidence supports the Ethiopia findings, suggesting that promoting entrepreneurship may be a viable solution to improve the situation of women in low-paid informal jobs, provided that investments are adequate (more than just token cash grants or loans and other inputs) and address the constraints women face. For instance, a relatively large capital transfer paired with training and technical visits upgraded the occupational choices of very poor women in rural Bangladesh and was cost-effective and sustained (Bandiera et al. 2013). Similarly, sizeable cash grants for young adults working in groups in conflict-affected northern Uganda increased business assets and incomes, and four years later, income growth was greater for young women (who started from lower incomes) than for young men (Blattman, Fiala and Martinez 2014). More generally, the new evidence suggests that adequate injections of capital can stimulate self-employment and increase earnings of poor women (and men) when paired with low-cost complementary interventions, even in poor and fragile states (Blattman and Ralston 2015).

The Potential of Social Enterprises

While most of the above findings on transforming subsistence-level enterprises examine impacts on individual entrepreneurs, collective social enterprises, where a business venture with a social objective is built on collective work and ownership (and is worker-centric, worker-owned, and democratic), are a potentially powerful alternative solution to upgrade the employment options available to women working in low-paid informal jobs.

Social enterprise ventures combine social goals and social value creation with stiff financial constraints, and reduce dependence on philanthropic support as they grow. Successful social enterprises change two features of existing systems: economic actors and enabling technology. They introduce certification systems to attract a customer base and enhanced technical solutions to build sustainable businesses (Osberg and Martin 2015).

Women’s self-help collectives and cooperatives have been popular in India since the 1950s, but with noted exceptions, have not been successful at transforming social aims into sustainable business ventures. One such exception is Shri Mahila Griha Udyog Lijjat Papad (Lijjat), a social enterprise where women home-based producers of papad, a savory snack, are organized as a for-profit cooperative (Datta and Gailey 2012). Another exception is the collective enterprises SEWA has established, including Gitanjali, the subject of this study.

A unique advantage of a collective model for poor women, especially in resource-constrained and socially conservative environments, is the added self-confidence or self-reliance that women obtain, contributing to their overall “empowerment,” in addition to increased voice, collective strength, and bargaining power with authorities and employers. A study of SEWA members showed that the presence of and social support from a peer raised women’s work aspirations, resulting in higher business income when they were trained in business skills alongside a friend; this was especially the case for women subject to conservative social norms (Field et al. 2015).

Mayra Buvinic is a senior fellow at CGD. Tanvi Jaluka is the gender and development program coordinator at CGD. Megan O’Donnell is the policy manager for gender issues at ONE Campaign.

This study was funded by a grant from WEConnect International to CGD. CGD is grateful for contributions from its board and funders in support of this work.

The authors are grateful to WEConnect International for its support of this study. We wish to thank colleagues from Gitanjali, SEWA, Accenture, and WEConnect International for providing much of the background information and data for this report through interviews and financial records. Special thanks also to Elizabeth Vazquez, WEConnect International, Reema Nanavaty, SEWA, and Amanda Ellis, East-West Center, for their interest in and valuable insights on this work, and to Deepika Padmanabhan for her financial analysis and other substantive contributions to the report. Lastly, our admiration and deep gratitude goes to all the Gitanjali sisters, including especially the eight sisters who kindly answered our questionnaire.

All photos are by Tanvi Jaluka. All financial information was provided by Gitanjali.
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Authors

Mayra Buvinic Mayra Buvinic, an internationally recognized expert on gender and development and social development, is a Senior Fellow both at the Center for Global Development and the United Nations Foundation. Previously, she was Director for Gender and Development at the World Bank. She also worked at the Inter-American Development Bank (IDB) where she headed the Social Development Division and was founding member and President of the International Center for Research on Women. She has a PhD in Social Psychology from the University of Wisconsin-Madison.

Tanvi Jaluka Tanvi Jaluka is the Program Coordinator for the Gender and Development Team, supporting the work of Mayra Buvinic and Charles Kenny. Previously, Tanvi spent time in the Netherlands working with the Center for Frugal Innovations in Africa to conduct research on women’s economic empowerment in Malawi. She also has a background in social justice activism at the Vassar College Women’s Center where she mobilized programming around gender and LGBTQ+ rights. Tanvi earned her B.A. in International Studies and Economics from Vassar College, focusing much of her undergraduate research on women’s financial inclusion in South Asia. She is fluent in Hindi.

Megan O'Donnell Megan O’Donnell was the Gender and Development Program Coordinator at the Center for Global Development. Before joining the Center, O’Donnell completed a Master of Philosophy in Modern Middle Eastern Studies at the University of Oxford, where her fieldwork focused on domestic violence shelters in Morocco. Previous professional experience includes interning with the International Center for Research on Women and the Middle East Institute and working as the coordinator of the University of Virginia Women’s Center’s free legal clinic. O’Donnell graduated from the University of Virginia with a BA in Politics and French.

Related content BRIEF The Gitanjali Cooperative: A Social Enterprise in the Making... Mayra Buvinic, Tanvi Jaluka, and Megan O'Donnell 9/15/2017


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Turning Trash into Social Value: Can a Private Sector Model Work for Poor Women in India?

Featuring

Mayra Buvinic, Senior Fellow, Center for Global Development

Nedra Dickson, Global Supplier Diversity and Sustainability Lead, Accenture

Henriette Kolb, Head of the Gender Secretariat, International Finance Corporation

Elizabeth Vazquez, President, CEO and Co-Founder, WEConnect International

Melanne Verveer, Executive Director, Georgetown Institute for Women, Peace, and Security

Moderator

Rajesh Mirchandani, Vice-President of Communication and Policy Outreach, Center for Global Development

Women are overrepresented in the informal sector worldwide, often stuck in dangerous, insecure, low-paid jobs. Waste picking in particular is a highly vulnerable and risky form of informal employment. In 1995, India’s Self-Employed Women’s Association (SEWA) organized women waste pickers in Ahmedabad into a cooperative to improve their working conditions and livelihoods. Over time, this informal arrangement evolved into Gitanjali – a women-owned and -run social enterprise, that produces a full range of stationery products for large multinational corporations, including Staples, IBM, and Goldman Sachs.

Date & Time Wednesday, January 31 10:00 - 11:30 a.m. Accept Decline Share this event! Twitter Facebook Follow @CGDev #CGDTalks

Location Center for Global Development 2055 L St, NW - Fifth Floor Washington, DC 20036

Not able to attend in-person? Sign-up to receive a reminder to watch the Live Webcast. The event will stream live and be available after at CGDev.org. What difference has Gitanjali made to the lives and opportunities of women waste pickers in India? What are the implications for women’s social enterprises in other countries? What are the challenges that remain to be overcome? The Center for Global Development is delighted to bring together some of the key private sector partners that helped Gitanjali generate social value, along with practitioners from the public sector and multilateral financial institutions, for a robust discussion about job options for poor women in low paid, informal occupations, including a model entrepreneurship venture. The event will be informed by the CGD report, The Gitanjali Cooperative: A Social Enterprise in the Making. Copies of the report’s executive summary will be provided. Light refreshments will be available.