Information is power...so how do we use it for good?
“Human behaviour flows from three main sources: desire, emotion and knowledge” – Plato. Perhaps this explains why we as humans are so hungry for information. With the prevalence of internet connectivity and social media, you could in fact argue that we live in an age of information overload.
Throughout history, people have recognised that those who control information hold power. We see this with the rise of fake journalism, with deepfakes the next evolution of this trend. But we’ve also seen the use of information for good. For example, increasing awareness of our environmental impact as consumers is slowly changing behaviour, through campaigns such as Earth Hour and documentaries such as Al Gore’s The Inconvenient Truth, that are closing the feedback loop between producer, consumer and the environment.
In the developing world, misinformation or the lack of information is also a prevailing trend, albeit in other manifestations. Information plays a key role in value chains, particularly those where the distribution of power, and therefore profit, is heavily skewed towards middlemen and end sellers, usually at the expense of primary producers. Conversely, information is also being used to equip farmers with the knowledge to run their operations more productively and profitably.
The value chains described below are examples of where information has been misused, creating an impediment to improved livelihoods for producers.
Myanmar pulse farmers
Myanmar is one of the world’s top three pulse producers, exporting approximately 1 million tonnes of pulses per year (valued at around US$1bn). Domestically, pulses are Myanmar’s second most important commodity group for consumption purposes and around half of Myanmar’s farmers grow pulses.
However, Myanmar’s pulses have a reputation for being of poor quality, severely limiting their export markets. This leaves the industry vulnerable to exchange rate fluctuations, the changing government policies of trade partners and with limited bargaining power.
Within this macroeconomic context, there are additional information fractures within the value chain. Farmers have limited access to export market intelligence (e.g., which specific seed varieties are in demand and attract a higher price), and even if they were growing the right varieties, it’s in the best interests of those further along the value chain to ensure that farmers don’t know the value of their goods. Until and unless:
(a) there is a better understanding of the global pulse market and what Myanmar’s competitive advantages are;
(b) the value chain is systematically realigned to take advantage of these opportunities; and
(c) profits and incentive models are redesigned to fairly compensate all value chain stakeholders,
pulse farmers will struggle to make the shift from price taker to price maker.
Cashmere herders of Mongolia
Most of us view cashmere as a luxury fibre, although in recent years, clothing labels have sought to make it more accessible to the everyday consumer. It’s generally known that cashmere comes from certain species of goats, but how many of us understand the work that’s involved in getting to the end product? Here’s a snapshot:
A cashmere goat’s coat consists of varying qualities – the further away from the goat’s body, the lower the quality of wool. On average, the split between grade A (highest quality), B and C is 30/40/30.The wool is harvested once per year, when goats naturally shed their winter coats for summer. This is also the time of the year where herders receive almost 60% of their annual income.For context, one goat yields approximately 300g of raw cashmere. At an average price of US$35 per kg, you can quickly see how many goats you’d need to manage to earn a living. This is why so many herders are stuck in a vicious cycle of poverty.
Herders generally have a basic level of understanding of the various quality grades of cashmere. But as is in the case of Myanmar pulses, it’s in the best interests of the traders who purchase the cashmere from herders to keep them in the dark – often offering one low price based on the quantity of cashmere, without a quality premium. Couple this with the fact that herders have limited access to sale channels, and it’s clear that they’re in a very vulnerable position – a position that traders can take advantage of to drive market prices down. The less information that herders have, the lower the price that traders will have to pay.
So, let’s think about how we can use information for good – through the considered use of tools as sophisticated as blockchain to as unsophisticated as word-of-mouth – to redistribute the balance of power and ensure that the most vulnerable aren’t taken advantage of. Let’s take the time to understand how information may be used to empower those who are living in poverty.