Working Together: Forest-linked small and medium enterprise associations and collective action

Small and medium forest enterprises (SMFEs) provide an opportunity to reduce poverty and sustain forests. But they face a number of critical bottlenecks to their development (e.g. insecure forest access, lack of market information or bargaining power). Working together in associations can overcome such bottlenecks where few other support structures exist. There are literally thousands of forest-linked small and medium enterprise associations in developing countries. Many arise spon- taneously from strong collective interest. Some fail, but many succeed. Successful associations are the means to achieve three important development ‘ends’: • Reducing transaction costs • Adapting strategically to new opportunities • Lobbying for more supportive policies This paper draws out some lessons on how and why associations work. It summarises research from Brazil, China, Guyana, India, South Africa and Uganda. The research found that lasting associations generally have a strong degree of autonomy. They usually have leaders with a track-record of social commitment. Most have gradually evolving sets of procedures that institutionalise the progress made by charismatic founders. Their focus is usually restricted to a few long-term issues. Equity is highest where there is greatest investment in democracy. Equitable associations tend to pay attention to transparency over costs and benefits. Most also have in place sanctions for free riders or those who break their rules, and clear procedures for resolving conflicts. The single major policy implication is that forest based associations can and do work. They work in places where there is little else to improve the livelihoods of the poor. Decision-makers should support them as a result; the most useful support tends to be responsive rather than imposed. It is usually orientated towards self-help options such as strengthening umbrella associations and improving awareness of existing support services. It often has a strong focus on providing information on bureaucratic procedures, product design and markets, finance and technological innovation.

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