The LS Argan program in Morocco – Greater commitment to the sustainability

Situation and aim of the project

Sustainable sourcing of new raw materials.
Global specialty chemicals supplier Cognis and its active ingredients business Laboratoires Sérobiologiques (LS) are continuously looking for new plants which can be used in the development of innovative actives for the cosmetic industry. In 2001, this search led LS to Morocco, where we began to study the local ecosystem, and in particular the Argan tree.

To take into consideration traditional knowledge and local expertise, a partnership was set up between LS and Zoubida Charrouf, a professor at Rabat’s Mohamed V University and the founder of the Targanine cooperative network. The long-term strategy was to combine scientific innovation, commercial development of the Argan sector in Morocco and specific sustainability principles. Key elements included sustainable diversification of local revenues, the protection of the Argan forest, and the support of local cooperative members.

This program resulted in three cosmetic actives developed by LS based on argan oil-cakes and argan leaves, including the cosmetic grade Argan oil Lipofructyl™ Argan which complies with best practices in environmental protection and supply chain quality, and meets fair trade standards. It is certified 100% organic by Ecocert, and labeled Bio Equitable (Organic- Fair Trade) by the French association Bio Partenaire.
For the commercialization of these actives, LS supplies oil and oil-cakes itself through an approved network of cooperatives that respect our sustainability strategy, and employ a mainly female workforce, thereby improving the integration of women in the Moroccan society.

A step further in the sustainability of the supply chain.
However, LS was committed to making the supply chain for its Argan products even more sustainable and equitable, exceeding the requirements of some organic certifications and fair trade labels. To this end, it implemented a comprehensive Corporate Social Responsibility (CSR) program, in collaboration with L’Oréal and Yamana, a NGO known for the CSR structuring of the textile industry (through its “Fibre Citoyenne” program).

Yamana was chosen as a partner in this innovative tripartite approach because of its unique position compared to most certifying bodies. Not only does it focus on long-term strategy, but it also takes into account how commercial activities impact and are perceived by local communities. Interviews are conducted directly with various stakeholders at all levels of the supply chain to give a holistic understanding of local opinion.

The Argan Forest
The Argan tree (Argania spinosa (L.) Skeels) is indigenous to southern Morocco. It is largely found in the south-east of Essaouira on the Souss plain. The Argan forest extends over approximately 800,000 hectares and contains more than 20 million trees. It acts as a natural barrier against the advance of the neighboring Sahara desert. The fruit of the tree contains a very hard shell holding between one and three kernels, and a valuable oil can be extracted from these.

The Argan forest is extremely important socio-economically, as it supports over three million people (out of a total Moroccan population of just over 30 million). However, unfortunately it is in decline, as a result of changes to rural lifestyles. Over-exploitation, soil erosion and desertification have all played a part, and as a result, Unesco classified the Argan forest as a Biosphere Reserve (RBA) in 1998. This designation is given to selected inland and coastal ecosystems where modern development can be reconciled with the conservation of biodiversity in practical ways.


Finding the right strategy

An 18-month long program was initiated in June 2008, when Yamana moved to Morocco in order to directly assess the strengths and weaknesses of the current processes in the supply chain, and to propose relevant and realistic improvement measures in the following areas:

• Fair return to the local community: going above and beyond the minimum requirement expected to pay with fair prices on fair terms. The program looked at ways to ensure decent living conditions and sustainable improvements in quality of life. Non-monetary benefits were also considered, such as participation in training programs or health insurance for cooperative members. Besides promoting a better quality of life, and the aim is to contribute to the overall economic and social development of the area.
  
  
• Traceability (a record of the origins, location and processing of all Argan products, at every stage from harvesting to delivery of the cosmetic raw materials): by making e.g. leaves traceable, it is possible to monitor compliance with good collection practices that are necessary to the long term preservation of biomass. And tracing fruits means we can guarantee that they originate from non-polluted parcels; this increases the value of such parcels and therefore encourages good farming practices.
  
  
• Respect for traditional knowledge related to local biodiversity: the aim was to better understand local perceptions of patent rights relating to indigenous local flora. Even where products had been granted patents because of their novelty and inventivity, third party evaluation and assessment of local perceptions can help to better guarantee that traditional knowledge is respected.
  
  
• Local empowerment: with the goal of increasing communities’ autonomy and sense of responsibility by training employees in technical processes, quality control, accounting and communication.
  

Measures taken to improve the situation

Fair return.

• Fair price: LS’s policy for setting the prices paid to cooperatives is guided by the sharing of monetary benefits. LS pays local producers directly, without intermediaries, at a non-negotiated price equal to or greater than the market price. This payment policy follows the fair trade guidelines, and incorporates payment in advance, a long-term contract, and a commitment to buy specified volumes. To ensure transparency, LS keeps local partners informed about the general market situation and its own commercial strategy.
  
  LS is an active player in a joint initiative with major customers of the cooperatives network to monitor the fair sharing of benefits among all stakeholders throughout the supply chain. A Policies and Procedures Manual has been finalized, a chapter of which is devoted to the transparent allocation of benefits and the related democratic management.
  
  
• Non-monetary benefits: in addition to the literacy classes and professional training, educational programs relating to environmental protection have also been introduced. As a result, network members understand the importance of the Argan tree better, and are more involved in its conservation. Increased financial autonomy and decision-making power for female workers has helped to raise the social status of cooperatives women in this rural environment.
  
  Through their partnership with Yamana, LS and L’Oréal are also involved in a pilot program that aims to set up and manage a social fund. This fund could be used to support social, medical or cultural programs that aim to improve living conditions for cooperative members. The final decision on the allocation of the fund’s money will be taken using a democratic decision-making process.

Traceability.
A traceability guide has been written and translated into Arabic. Full traceability, from fruit origin to delivered product, is now being implemented in all cooperatives.

Protection of the biodiversity
To ensure the conservation of biodiversity, the following measures have been taken:

• Conservation of the Argan forest: strict guidelines are followed during the harvesting and exploitation of natural Argan resources. The leaves are collected on Argan parcels belonging to a convention with the Moroccan Water and Forests Authorities.
  
  
• Reforestation: the convention with Moroccan Water and Forest Authorities specifically implies commitments for maintenance of trees and reforestation of the parcel.
  
  
• Environmentally responsible processes: the supply chain safeguards that the Argan products are cultivated and harvested without using any chemical treatments, pesticides or fertilizers. Argan oil and Argan oil-cakes have been certified by Ecocert as 100% from organic farming.

Protection of traditional knowledge.
LS recognized its local partner as co-inventor in the patent applications for new uses that were identified from Argan fractions previously non-exploited in cosmetic applications - namely the protein-rich extract of the oil-cake, and flavonoid-rich extract of the leaves- , making sure that traditional knowledge and geographical origin would be documented and respected. Yamana was given the task of checking the impact of patents on the economic activity and general functioning of the sector, and on local people’s perceptions of the patents’ influence on their monetary and non-monetary returns. Interviews conducted locally did not identify any negative perceptions about LS’s patents.


Local empowerment.

• Through their partner Yamana, LS and L’Oréal were involved in initiating a Policies and Procedures manual for the cooperatives, translated in Arabic language.The manual sets clear rules for members, similar to a CSR code of conduct. This increases the cooperatives’ autonomy and sense of social responsibility – a vital part of efforts to set up a sustainable organization that complies with broad CSR rules. The Policies and Procedures Manual formalizes the cooperatives’ CSR processes. It covers various aspects including: a democratic governance approach, transparency and equitability between cooperatives; monitoring of benefit allocation; supply conditions; quality guidelines; and social and non-monetary benefits. 
  
  
• Quality, safety and hygiene guidelines have been implemented in order to improve working conditions in the cooperatives. As a result, local people now understand the importance of safety and hygiene practices, and have incorporated these into their daily work. LS also provides technical assistance on a regular basis. This empowers local workers in the areas of production, planning and quality assurance. The cooperatives also share best practices and learnings among themselves. This ensures continuous improvement.
  
  
• The scientific partnership between LS and local experts has identified new ways of processing other parts of the Argan tree, including uses for by-products of Argan oil production. This has increased and diversified the local cooperatives’ revenue streams.
  
  
• The new role of Communication Manager was created. This has enabled the cooperatives to understand the value added by their CSR structure better. As a result, they can now differentiate themselves from their competitors, putting them in a better commercial position.
  
  
• Finally, Yamana has found that the cooperatives network is increasingly autonomous when it comes to economic development and quality assurance compared to the Argan sector as a whole. It believes that within a short period of time, the network will be capable of managing itself without external support.