1. Farmer Institutional Development
Global Forum for Rural Advisory Services (GFRAS)
Part of the New Extensionist Learning Kit

2. Farmer Organisations (FO)
Globally farming is becoming more competitive
Small scale and individual farmers can benefit from pooling their resources and working in groups

3. Definition and differentiated mandate of farmer organisations
Study Unit 1
Definition and differentiated mandate of farmer organisations

4. Overview Study unit 1 is about: The definition of an FO
The characteristics of FOs
The different categories of FOs
The services different categories of FOs provide

5. What is a farmer organisation?
Definition
Independent, non-governmental, membership based rural organisations
FOs can have various names depending on the group they represent.
Some of the names used to refer to FOs include producer organisations, rural organisations, farmers’ cooperatives, farmers’ associations, farmers syndicates, chambers of agriculture and farmers’ unions.

6. Characteristics of FOs
Operational autonomy
Membership based
Unrestricted freedom of members to democratically participate and enjoy their rights
Recognition by authorities
All FOs exhibit the following basic characteristics that distinguish them from other civil society organisations.
Operational autonomy: FOs are private organisations and are operationally independent from governments and other civil societies.
Membership bases: FOs have formally defined membership criteria.
Recognition by authorities: Formal recognition allows organisations to legally represent farmers and offer certain services that require legal status.

7. Categories of FOs
Due to the wide variety of forms and functions, it is not easy to categorise FOs. One of the simplest ways of categorising these organisations is to group them into three general groups.
There are certain services that can be provided by all the categories namely:
Representing farmers in advocacy activities;
Linking members with service providers; and
Negotiating contracts for members.

8. General interest groups
Represent the agricultural and economic interests of farmers
Main goal:
Represent farmers during policy and development programme formation & implementation
Improve farming standards for members
Membership can come from any organisation or individual who meets membership requirements
Each category also has some specific services unique to that category that they have to provide.

9. Specific services provided
Represents members in policy and programme development and review
Integrates mutual interests of farmers from different backgrounds and coordinates actions to address the interests of all
Mobilises financial and human resources for other farmer organizations
Provides technical capacities in organizational and institutional development
Facilitates knowledge sharing among members
Provides information to members and authorities on aspects of agricultural development
Provides information to members on national or international events that may influence farmers
Assists in the participation of farmers in national and international agricultural trade fairs
Promotes networking of farmers from different backgrounds
Supports commodity based organizations to carry out market research, data collection, analysing, consulting as well as training
Specific / unique services provided by agricultural interest groups.

10. Cooperatives
Independent business organisations jointly owned and democratically controlled by farmers, producers and other players in the value chain
Main goal:
Help meet members’ need for agricultural services and create demand for their produce
Provide education, training and information services.
Membership is open and voluntary
Usually smaller and operate in geographically defined areas
Profits shared according to level of patronage

11. Specific services provided
Assists in the distribution of production supplies (e.g. seeds, chemical, fuel etc.) to farmers
Facilitates processing of membership produce for value addition
Aggregates farmer produce in order to deliver large quantities to markets
Assists in the bulk purchases of agricultural inputs to take advantage of reduced prices
Facilitates the storage of agricultural inputs and farm produce
Provides specialised services such as credit, insurance and transport
Specific/unique services provided by agricultural cooperatives.

12. Commodity based organisations
Specialise in a single commodity or closely related products
Main goal:
Bring together different players in the value chain related to a particular commodity
Membership requires participation in production, processing or distribution of particular commodity
Usually represent a large area
Size of the wholesale market or natural production boundary of commodity
Farmers operate as individuals and gain profit as individuals

13. Specific services provided
Provides advocacy and negotiations on trade issues
Organises and coordinates fair deals for their members in their transactions
Provides specialised training to members
Facilitates market research on various commodities
Provides market and other relevant technical information to farmers, policy makers and buyers
Creates awareness of new technologies available to farmers
Produces and distributes publications on various subjects of interest to farmers
Promotes the production of adequate quantities of good quality products that meet market specific requirements
Organises transport and storage logistics for members
Facilitates combined production activities in order to meet specific market demands
Specific/unique services provided by commodity based organisations.

14. Prerequisites for successful farmer organisations
Study Unit 2
Prerequisites for successful farmer organisations

15. Overview Study unit 2 is about:
The internal challenges that affect the success of FOs
The external challenges that influence the success of FOs
Possible ways to address these internal and external challenges faced by FOs

16. Factors that affect FO success
Challenges faced by FOs can be divided into internal and external factors.

17. Internal factors
Challenges that arise from within an organisation and its members

18. Inadequate capacity to represent
Some FOs lack the resources to represent farmers and influence agricultural policies
FOs should:
Develop of clear organisation, membership and communication structures
Regularly review these structures to promote transparent interaction among members at all levels
Some organisations lack the capacity to properly identify or articulate farmers’ needs or they have underdeveloped systems for feedback between representatives and farmers.

19. Limited understanding by society
The general public are not always aware how FOs can benefit farmers
FOs should: 
Involve community members in establishing organisations and their goals
Ensure that members receive clear and measurable benefits from joining the organisation

20. Overdependence on external assistance
Many FOs rely heavily on funding from external donors or governments
FOs should:
Utilise available resources optimally
Diversify sources of funding and enable members to raise their own funding
These external funders frequently attach strict conditions to their funding, limiting the activities of the organisation.

21. High levels of illiteracy
Illiteracy and limited knowledge of organised agriculture can affect all aspects of FOs
FOs should:
Provide education and training programmes
Promote exposure between farmers from different social, cultural and economic backgrounds
Farmers form communities with high levels of illiteracy struggle to articulate their needs and develop proposals that can be presented to potential funders.

22. Ineffective leadership and management
FO leaders and management sometimes lack understanding of their roles or how the FO should operate
FOs should:
Ensure transparent and efficient election processes
Clearly spell out the different roles of leaders and management
FO leaders and management are not necessarily chosen based on merit or skill.

23. Poor institutional structures
Many FOs have poor financial management, human resource development, leadership and management structures
FOs should:
Develop strategies to strengthen organisational structures
Develop structures that are supported by the available resources

24. Inadequate understanding of policy issues
Many FOs lack the ability to identify and understand policies that negatively affect farmers
FOs should:
Ensure their involvement during the planning phases of policy initiatives
Promote proactive interactions between members and the public sector
FOs often also lack the ability to analyse such policies and to formulate better alternatives.

25. External factors
Challenges that arise from the environment in which an organisation operates
The external environment includes factors ranging from the political and economic environment to the social, cultural and ecological conditions in which the organisation operates.

26. Government policies & political interference
Governments may implement policies that negatively affect farmers and FOs
FOs have to develop structures and mechanisms to address such policies
Politicians and government officials may take advantage of farmers and FOs for political gains.
FOs need rules separating leadership and management from politics

27. Government policies & political interference
Governmental institutions may impose administrative, regulatory and legal burdens
FOs employ liaison officers who are familiar with all the administrative and legal requirements to register and operate FOs successfully

28. External support systems
Most FOs need external assistance and donor funding
Governments alone cannot provide enough external assistance
FOs must work together with extension services, the public, private and non-profit sectors to ensure the appropriate level of external support

29. Private sector involvement
The private sector can assist FOs with investment and specialised skills that can improve their productivity
FOs form relationships with policy makers and service providers in the private sector
FOs should develop procedures that will protect them from exploitation by external service providers

30. Sustainability of farmer organisations
Study Unit 3
Sustainability of farmer organisations

31. Overview Study unit 3 is about:
The factors that affect the sustainability of FOs
Farmer representation
Good governance of FOs
Financial sustainability of FOs

32. Factors that affect FO sustainability
The most prominent factors that affect FO sustainability are effective farmer representation, good governance and financial viability. All of these factors interact with each other and have to be considered.

33. Farmer representation
FOs are expected to represent the views of individual farmers that would not have been heard otherwise. They have the responsibility to gather and articulate the needs of farmers in a manner that can be used and understood by authorities, but that does change the original message of the farmers.
Good membership, leadership and decision making structures and networking can affect the ability of FOs to represent farmers effectively.

34. Membership structures
FOs have several levels of membership
Lower level membership structure
Should membership be based on individual family members or an entire family unit?
Higher level membership structure
Should they allow individual membership or affiliated membership from other lower organisations, or a combination of both?
Each option has merits and disadvantages
Membership to FOs can come in several forms. Poorly defined membership structures can cause a lack of communication between members and ineffective representation amongst other problems.

35. Membership structures
Multiple line membership
Multiple line membership structures allow a combination of individual and affiliated membership.
Disadvantages:
This form of membership structure is more administratively complex.
Larger potential for dual membership.
Advantages:
It allows for a large diversity of membership categories and more chance of participation by different members of the farming community.

36. Membership structures
Single line membership
Single line membership structures only allow affiliated membership. There may be more than one channel of membership but no individual farmers are accepted as members to the higher levels of the organisation.
Disadvantage:
Might not reach all the members of the community.
Advantage:
This membership structure reduces the risk of dual membership and is more manageable.

37. Leadership structure
Leaders have to set the direction and goals of an organisation
Good leadership
Ensure that all the levels of membership of an FO are adequately represented
Ensure maximum exposure to authorities during policy development
Provide alternatives to agricultural policies and programmes that negatively affect FOs

38. Good decision making structures
Hierarchal decision-making structure
The upper level structures elect the lower level structures of decision-making
All levels are involved in decision making
Decisions move from lower levels to upper levels
Feedback moves down from higher to lower levels
Strong internal decision-making structures are very important for fully sustainable FOs.
Poor decision-making processes can lead to leadership and management making decisions without consulting lower level members and misrepresenting their members.

39. Good decision making structures
Hierarchal decision-making structure
Guarantees thorough discussion of ideas and proposals before final decision is made
Guarantees that all members are involved in the process
Strong internal decision-making structures are very important for fully sustainable FOs.
Poor decision-making processes can lead to leadership and management making decisions without consulting lower level members and misrepresenting their members.

40. Networking
Process of interacting with other institutions to exchange information and develop professional links and contacts
Increases FOs technical and financial resources
Provides information that can help FOs during lobbying and representation
FOs that work with other organizations can benefit from the sharing of resources, experiences and information which in turn can help FOs in their representation of farmers.

41. Good governance Governance Importance of good governance
The way organisations are directed, managed and held accountable for the control of its assets and resources
Importance of good governance
Defines roles and responsibilities of the leadership of an organisation and the management/secretariat
Ensures responsible management of funds and resources
Guarantees transparency
Guarantees accountability
Transparency:
Well governed organisations have transparent and effective decision-making structures.
Well governed organisations allows members and other stakeholder access to information regarding the running of the organisation.
Accountability:
Well governed organisations allows members and other stakeholder the opportunity to freely air their views regarding the operation of the organisation.

42. Governance structure Governance structures consist of several levels
Clearly maps out the chain of command in the organisation

43. Basic governance structure
The general assembly or general council has overall authority. The general assembly or council should be representative and reflect the diversity and composition of the organisation.
Members of the lower level structure are democratically elected and are given a specified term of office.
Below the general council is the secretariat which works closely with executive board.
Below the secretariat and executive committee are various standing and ad hoc committees and departments that are responsible for specific areas of work in the organisation.
These committees report to the executive board or secretariat which reports to the general council.

44. Basic governance structure
Overall authority of FO
Representative of diversity and composition of FO

45. Basic governance structure
Below the general council
Secretariat and executive committee work together closely
Democratically elected and given a specified term of office

46. Basic governance structure
Below the secretariat and executive committee
Responsible for specific areas of work in the organisation
Democratically elected and given a specified term of office

47. The secretariat
Oversees the daily running of the organisation and consist of professionals of various fields of expertise
The responsibilities of the secretariat requires individuals with specialised skills
FO leadership must employ and elect the appropriate people to this branch of the governance structure

48. Responsibilities of the secretariat
Regular communication with members and external stakeholders
Development and implementation of projects and programmes based on objectives of the organization and resolutions decided on at council or annual general meetings
Facilitating partnerships with other parties and institutions outside the organisation
Ensuring that organisational records and documentation is updated and backed up regularly
Accounting, financial administration and budgeting;
Resource mobilisation
Maintaining and managing movable property and material stock of the organisation
Ensuring that organisational asset inventories are compiled and updated regularly
Supplying members with current information in agriculture development nationally, regionally and internationally
Organising of conferences, workshops and meetings
Representing the organization in agricultural and technical meetings within and outside the country

49. Financial sustainability
The ability of an organisation to raise and maintain the funds necessary to meet its short, medium and long term functional requirements
Numerous factors can affect the financial stability of FOs, including financial planning and budgeting, competent financial management systems, effective financial monitoring systems and securing funding.
Shutterstock image

51. Budgeting is the process of creating a plan of how financial resources are going to be used and it allows an organisation to determine in advance whether it will have enough resources to meet all its obligations.

52. Together with appropriate book keeping systems and budgeting, proper financial monitoring and reporting is essential to the successful operation of any organisation.

54. Many FOs are dependent on external funding
Many FOs are dependent on external funding. This is not necessarily a problem as long as there are clearly defined structures that stipulate the role of these funders in the running of the organisation and mutual accountability.

55. Functions of farmer organisations
Study Unit 4
Functions of farmer organisations

56. Overview Study Unit 4 is about: Economic functions of FOs
Political functions of FOs
Social functions of FOs
How FOs facilitate access to agricultural research and technology

57. Functions of FOs

58. Economic functions
FOs benefit from the principle of economies of scale
The per unit cost of any product is reduced when the total production cost is spread over a larger quantity

59. Economic functions Benefits for farmers
Able to negotiate as a group for discounts and reduced unit prices
Aggregation of farming produce
Engage in collective influence on local policies and practices that affect their markets
Increases confidence of farmers in uncertain markets
Aggregation of farming produce:
Aggregation of farm produce helps farmers to come up with the necessary quantities and qualities demanded by markets.

60. Economic functions Benefits for service providers
More cost effective to deal with a group of farmers than with individual farmers
Administrative costs reduced
Are able to reach farmers that would otherwise have been overlooked
The cost of providing any service is reduced when farmers are contacted as a group because the services provided reach a large number of clients with the same expense the service provider would have incurred in reaching out to a single farmer alone.

61. Political functions FOs and farmer representation
FOs gather and consolidate views of individual farmers and present them to policy makers
FOs provide feedback and keep the community up to date with agricultural development programmes and policies in their area
Lobby for the provision of quality extension, marketing and financial services
Proactively influence the formulation of agricultural programmes and policies

62. Social functions
FOs exist in societies with huge social disparities and many marginalised groups
FOs promote social cohesion
FOs enhance solidarity and social capital
Promote upward mobility
FOs provide training and education to these groups
Provide access to skills, services and markets these groups would not have access to otherwise
Marginalised groups become more confident and independent

63. Facilitating access to technology
Farming is becoming more technologically advanced
Farmers need to access to new technology to improve their productivity
FOs role in facilitating access to technology:
Reliable source of information on new technologies and innovations
Create partnerships between farmers, researchers and extensionists
Easier for extension agents to communicate with groups than individuals
Communicate the needs of farmers to researchers and innovators

64. Acknowledgements
This module was made possible through the support of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) and United States Agency for International Development (USAID). The contents of this module are the responsibility of the authors and do not necessarily reflect the views of GIZ and USAID or respective their governments. All work by Global Forum for Rural Advisory Services is licensed under a CC BY-NC 3.0 Unported License.