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HSBC NEXT GENERATION DEVELOPMENT PROGRAMMEFIELD CHALLENGE - OAXACA
 This document provides an overview of the field project challenge for the Oaxacasite. The team of participants assigned to this project should review this briefing,read and investigate the key documents and research topics outlined in order tomaximise their impact on arrival at the site.It is important to remember that the teamshould make contact with the client at an earlystage to understand the challenge fully andformulate a way of working so questions andclarifications can be answered in a timelymanner. The group must ensure that all teammembers (including the learning facilitator andbusiness sponsor) are fully briefed in advanceof the field event and have the same level of understanding to ensure maximum impact on arrival.
CHALLENGE
 To assist your clients to develop a regional branding of forestry products forOaxaca Indigenous Communities and help them finding ways to access local(national) and international markets.
LOCATION
Four Indigenous communities at the Sierra Norte, Oaxaca, Mexico: Comaltpec, Trinidad, Xiacuí and Capulalpam.http://maps.google.co.uk/maps?f=q&source=s_q&hl=en&geocode=&q=santiago+xiacui&sll=17.058449,-96.731986&sspn=0.899309,1.235962&ie=UTF8&ll=17.292585,-96.434834&spn=0.224546,0.30899&t=h&z=12 
REGION
Mexico is amega diverse
 
country in whichOaxaca, astate located in the country’s southern part standsout for its cultural heritage with 15 indigenouslanguages and many local variants. This is believedto be one of the regions in world where agriculturewas first invented (Caran et al. 2006). It is also one of the areas within the American continent of greatesthuman interference in the natural environment. Itscultural diversity and the different ways in which
 
landscape was managed have made Oaxaca one of the richest biodiversityhotspots in Mexico. The Sierra Norte, located on in the north part of Oaxaca iscovered with different types of forests, including tropical rainforest, arid openforests and temperate pine-oak forests. Pine forests have the highestcommercial value in the region.After many years of government’s ownership and use of Oaxaca’s forests, localcommunities managed to regain control and tenure of their land and forests in along and confrontational process. As a result, Mexico managed to develop one of the most progressive socio-environmental forestry policy approaches in theworld (Chapela, 2005;Sunderlinet al, 2008). Over the past 15 years local indigenous communities have developed a soundforest management system (Klooster, 2000). The communities in Sierra Nortehave managed to organize themselves and set up a formal association: theZapotec and Chinantec Communities’ Union (UZACHI - Unión de ComunidadesZapoteco-Chinantecas). Since 1995 communities’ forests managed by UZACHIhave been certified by theSmart Wood programmeaning they meetinternational social, environmental and economic standards. To receive andmaintain the certification, UZACHI has to go through a series of internationaltechnical audits and follow guidelines set by the internationalForest Stewardship Council.
Local Context
 The Sierra Norte or Benito Ramirez Juárez mountainrange is located two hours away from thecity of Oaxaca. The high altitude of the “Sierra Norte”provides the perfect climate for the growth of Pinus. Atree widely used inthe forestry industry especially pulp and paper,furniture and civil construction. This mountainecosystem also hosts several other species and isconsidered a biodiversity “hot spot”, with manyendemic species, some of them under threat of extinction. The inhabitants of this region are nativeMexicans, descendants from two major ethnicgroups: the Zapotec and the Chinantec. Together theyown 25,000 ha of forest, entirely managed by a secularand sophisticated system in which decisions are made by community membersin a truly participative process. The two indigenous groups are organised in 4communities: San Mateo Capulalpam, Santiago Comaltepec, La Trinidad andSantiago Xiacui.
 
Each community controls and manages its own territory. The management of natural resources - wood mainly - as well as the provision of services like eco-tourism is done by Community Based Enterprises (CBE). Each one of the fourcommunities have its own forestry CBE whose main objective is to create jobs forcommunity members, contribute to community well-being, manage the forest ina sustainable way, cut, process and sell the wood. CBE’s are managed bycommunity members even though some of them lack professional training andhave limited administrative experience. Managers are appointed by aCommunity Council and are expected to change or leave jobs every two years. This has an impact on the development and implementation of businessstrategies. In fact, by the time new managers begin to understand the marketand the business; they are relocated to other areas or other businesses withinthe community. This high turnover prevents mismanagement practices but also increasesinefficiencies drastically since new managers spend a lot of their time in trainingand learning about the business. This control mechanism is a cultural practicethat is unlikely to change in the short term. On the other hand, it makesmanagement more transparent as all managers are required to do a rendering of accounts before a community assembly on a regular basis. Even thoughcommunities are quite similar and explore the same natural resources (wood),each one sells their production independently and without any shared brandingor joint commercial efforts.Profits made from selling wood, eco-tourism and other forest products areinvested in community’s projects, like building schools, health programmes orother projects prioritized by the community. There is still room to increase profitsfrom the forestry business but the main challenge is to improve the way thebusiness is being managed. This is the key obstacle preventing Communities’CBEs to increase their income from wood.
PROJECT DESCRIPTION
In 1989 the four communities jointly set upthe “Union de Comunidades ProdutorasForestales Zapoteca Chinanteca de la Sierra Juarez”, (Sierra Juarez’s ZapotecaChinanteca Union of Forestry BasedCommunities) or UZACHI. UZACHI’s mainobjective is to provide technical advice forthe communities and assist them on how tobetter manage their forests and process thewood. UZACHI has a team of forestengineers and social workers who works withcommunity members from all 4 groups.UZACHI’s continuous work has led to the certification of forest products by ForestStewardship Council, FSC (http://www.fsc.org/). FSC is a certificationbody internationally recognised by the forestry industry, which awardscertificates of good management to forestry and timber processing companieswho manage their forests according to pre-defined social, environmental andeconomical standards.
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