Chid Liberty is the son of a Liberian diplomat, and grew up in Germany before moving to the United States. Growing up in a privileged background, he was unaware of the fact that Liberians in his home country were living in vulnerable circumstances. At 18, the death of his father inspired him to continue his father’s legacy of giving back, and made a decision to return home to help his nation rebuild.
He founded Liberty & Justice, Africa’s leading ethical apparel manufacturing company, which specializes in value chain management for high-volume goods for American clothing brands. His factories not only ensure quality, but a deep respect for social and environmental impact. Find out more about how Liberty maintains an ethical and sustainable manufacturing business, and why Africa is the future for investment:
You decided to start a business in a country that suffered a 14-year Civil War, and yet you have been quoted saying that you were at the right place, at the right time. Despite this challenge, what factors were in place so that you were able to succeed at that particular time and place?
[When we first started] there was already a movement of Liberian women organizing through their churches, women’s associations, etc. We felt like we could tap into that, and do something in partnership with the women. Ten years later, it is the heart of everything we do.
We talk a lot about ethical supply chains, and helping US companies move their production in Africa, but we always do it with the women and workers in mind.
I spoke to Amy Hall of Eileen Fisher the other day. She mentioned that one of the most challenging things is convincing factories of the business case behind a sustainable or fair-trade model. As the owner of a fair-trade factory- what is the business case for you to keep this model?
We are a special factory in that we don’t see a choice [but to be ethical]. A big reason behind that is the kind of capital we have. Because we were started with impact capital, so many things go back to the source. We have the freedom to not have to do the things other factories have to do to survive.
The reason why we have a race to the bottom is because so many factory owners’ wealth and financial well-being is tied to the factory. When a big retailer comes through to ask for a price quote, they tell the factory owner that they can find a cheaper price with another factory. So then as a factory owner, you have to find a way to cut expenses to stay competitive, which then cuts into living wages [and other ethical/sustainable practices].
But because of my source of capital, I never have to make a decision between sending my kids to school, or breaking my country’s laws.
The best companies and biggest customers today are moving towards being the most ethical and sustainable. I know people are going to roll their eyes to this, but I spent 5 hours with [one of] the largest American retailers yesterday, and the amount of care and they put into their [supply chain] shows that it is becoming good business to be a good factory.
There’s still a lot of work to do, but the largest US retailers are going in the right direction. If you look at the best people in this business, their competitive advantage is their constant investment in social responsibility, sustainability, and innovation.
What are the easiest and most challenging initiatives to implement in a Fair-Trade factory?
The easiest to implement was whatever the workers wanted! We serve the needs of the worker. The way our factory started is we kicked off a huge meeting with different women’s groups, and we had this whole process of creating an ideal future- figuring out what mattered to them. There were things that came up, so we designed programs around it. We wanted to make sure that they can save money, buy a car, buy land. So the programs we created were a reflection of those needs. There’s not a factory in the world today that can say they do the same thing.
What is the missing piece in making ethical supply chains possible?
We can’t depend on the consumer to make all these changes, and we also can’t depend on the factory owner. The factory owner is trying to figure out how to make a profit in what I think as a commodity industry, where every year, your client wants you to do more, and every year, they want to pay you less. Pricing pressure is real.
There is a big strong role for government and regulations. I say that both on the domestic level and international level, we need to make sure that we are regulating what American brands do overseas.
What the Clinton Admin did in the 90s’ after a few disasters when they decided they would bring everything down a level. Factories should do a lot, but problems are very systemic, and you have to attack them on the systems level.
For major retailers who want to work with fair-trade factories, what advice would you give them on what types of characteristics to look for to ensure that the factory is indeed operating in a healthy, fair way?
It’s really about people, and being able to spend a lot of time with them. I discover things going on in my factories all the time, sometimes things that we’d look at as ‘crazy’, but completely normal to the people at the factory. So you really need to dig in, and know that there is no quick fix. Even the worst factories know how to get through a client visit, so you must have a deep level of engagement, and tools to have this engagement [when doing business across countries] and whistle blower assets throughout the year so workers can report [issues].
Why should impact investors look towards Africa for investments?
Because that’s where they’re going to get outside impact. I think it was Van Jones that said, “We’re losing a lot of genius on the table” (when referring to African-Americans). The same is ridiculously true for Africa. There is so much genius on the table. The amount of energy that has to be given to get clean water everyday means that the youngest population in the world right now is literally is hungry for opportunities to learn, but we are not engaging in that. That is a big problem.
African investments outperform the rest of their portfolio in terms of returns. I think we’re coming to this point where Africa keeps on returning amazing numbers, but I think it’s all about investing in really good fund managers to get the right opportunities. So finding fund managers to help create an entrepreneurial ecosystem is a big part of the future of investing in Africa.
What is your “Made in Africa” project?
Made in Africa was funded by C&A foundation. They gave us a grant to come up with a concept that would help factory owners to make improvements to their factories with the right incentives. In general, factories in Africa suffer from no access to capital, no access to great markets, and they need help with management. What if “Made in Africa” can solve that problem for them? The truth is, the manufacturing business is a pretty terrible business. We understand why all of these manufacturers are doing ‘shady’ stuff (we don’t excuse them, but the real problem is systemic). But we also have to launch our own brands.
We launched Uniform, and we are buying another brand, so that “Made in Africa” can now exist with a series of brands that help make it a lot easier for factories to operate ethically.
When brands, factory workers, manufacturers, and capital are aligned, that’s a big piece of the pie, but without governments and consumers on board, it may not work. We need everyone in alignment.
How has your involvement with SVC helped you and your company ?
I was an early awardee for the SVN (Social Venture Network) Social Innovation Award*, and that gave us a huge jump and visibility and access to investors and so on. Of course, we’ve also had so many partners and investors thanks to the organization. Two out of three board members of Liberty & Justice were also through SVC, so it’s been a great partnership. We’ve also presented at Investor’s Circle, (SVC), and met some great people there!
*SVC was formerly SVN and SVC before the two organizations merged.
To learn more about Chid’s’s work, visit the Liberty & Justice Website.
Join leaders like Chid at our annual conference this November 13-15 in Berkeley CA, as we convene to “Welcome the Next Economy”.