The Harvard Business Review has finally approved the Igbo Apprenticeship System as a model of communitarian capitalism that works.
The approval is sequel to the groundbreaking work of Ndubuisi Ekekwe, a Nigerian professor, on the Igbo Apprenticeship System, IAS.
The Igbos in Africa has been practicing for centuries what is today known as stakeholder, or communitarian, capitalism. The Igbo apprenticeship system (IAS) is a communal enterprising framework where successful businesses develop others, and over time provide capital.
For centuries, the Southeastern region of Nigeria has practiced communitarian capitalism — a construct that businesses must elevate the interests of communities, workers, consumers, and the environment alongside those of shareholders. The Igbos, the predominant ethnic group in the region, are known for the Igbo apprenticeship system (IAS), a communal enterprising framework where successful businesses develop others, and over time provide capital and give away their customers to the new businesses.
The implication is that few businesses grow to become very dominant, since they keep relinquishing market share, and in doing so, they accomplish one thing: a largely equal community where everyone has opportunities, no matter how small.
The result is that communities experience inclusive growth with empowered workers and customers helping firms deliver sustainable fiduciary results. In other words, creating value for all stakeholders — investors, workers, customers, communities, and the environment — is not a zero-sum game; empowered stakeholders empower markets of the future.
The IAS has been recognized as the largest business incubator in the world, as thousands of ventures are developed and established yearly through it.
Innocent Chukwuma, founder of Innoson Motors, the largest indigenous automobile manufacturing company by sales in Africa, is a product of IAS. So is Ifeanyi Ubah, the owner of one of the largest private fuel depots in Africa, Capital Oil & Gas, which has the biggest private jetty in Nigeria, an 18-ARM loading gantry, ocean-going vessels, a storage facility of over 200 million liters, and hundreds of distribution tankers.
Cosmas Maduka, who controls Coscharis Group, a conglomerate with diverse interest in manufacturing, automobiles, and petrochemicals, also passed through the system. Unlike Ubah and Chukwuma, who finished primary education but dropped out at the secondary level, Maduka did not finish primary school. Until recently, that was typical; education has instead been the apprenticeship model, where an individual learns the mechanics of markets and business secrets under a master.
At the core of it, the IAS is a business philosophy of shared prosperity where people co-opetitively participate to attain economic equilibrium. Major participants fund their competitors, and success is measured based on support offered to others to thrive, and not by absolute market dominance.
For centuries in the Igbo nation, this culture has been kept alive by reminding everyone of a popular saying, “onye aghala nwanne ya,” which means, “none should leave his or her brethren behind,” in the communities and in the markets.
The key focus of IAS is to prevent poverty by mass scaling opportunities for everyone. Igbos believe that when a child is born, he or she belongs to the community. (In fact, Igbos name their children “Nwaoha,” which means “a child of the community.”)
Parents bring the children into the world; communities ensure the children succeed and thrive. If anything happens to the parents or they are incapable of raising the child, someone else in the community will step in. Typically, through the apprenticeship system, the child goes through a process of living with a new family, and then over time will transition to working in the master’s business. After a few years, he or she is “settled”; the master willingly relinquishes market share by providing customers, funding to an obvious future competitor, and other things necessary for the mentee to have a thriving venture, with no equity in the new business.
In a very practical sense, you have a scenario where a man, trading in a city, returns to his village, picks three children (usually boys), who might have lost their fathers or the families are too poor to train them, and decides to ensure they have meaningful lives. Those children serve him for some years — a period of apprenticeship — and upon completion, he invites his kinsmen, business partners, and others as he “settles” them.
If he was holding a 10% market share in that specific market, by the time he is done, he might be holding only 7%, releasing 3% to the boys. For him, the growth of his company is not what matters; it is that the apprentices do well. But he doesn’t stop there. He sends them business opportunities, making sure they can thrive independently. In some cases, the masters may exit the sector entirely, in order to allow the others to thrive.
Largely, the Igbo apprenticeship system is a practical demonstration of the Ubuntu philosophy — “the belief in a universal bond of sharing that connects all humanity.” It may not be scored high when benchmarked on some Western business and economic frameworks, but for the Igbos and some Africans, it is a working system which has brought equality and peaceful coexistence in communities, making sure that no one leaves his or her brethren behind. Those are the evidential ideals of stakeholder or communitarian capitalism.