sustainability Article Contract Farming towards Social Business: A New Paradigm Iffat Abbas Abbasi 1 , Hasbullah Ashari 1 , Amin Jan 2, * and Ahmad Shabudin Ariffin 3   Citation: Abbasi, I.A.; Ashari, H.; Jan, A.; Ariffin, A.S. Contract Farming towards Social Business: A New Paradigm. Sustainability 2021, 13, 12680. https://doi.org/10.3390/ su132212680 Academic Editors: Concetta Nazzaro, Marco Lerro and Marcello Stanco Received: 12 September 2021 Accepted: 1 November 2021 Published: 16 November 2021 Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affil- iations. Copyright: © 2021 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https:// creativecommons.org/licenses/by/ 4.0/). 1 Department of Management and Humanities, Universiti Teknologi PETRONAS, Seri Iskandar 32610, Perak, Malaysia; iffatabbas24@gmail.com (I.A.A.); hasbullah.ashari@utp.edu.my (H.A.) 2 Faculty of Hospitality, Tourism and Wellness. Universiti Malaysia Kelantan, CityCampus, Pengkalan Chepa 16100, Kelantan, Malaysia 3 Department of Management Sciences, Kolej Universiti Islam Perlis (KUIPs), Kuala Perlis 02000, Perlis, Malaysia; shabudin@kuips.edu.my * Correspondence: amin_jan_khan@yahoo.com; Tel.: +60-18-2342141 Abstract: The current paper conceptualises an innovative, sustainable social business contract farming model by blending three essential business aspects, namely, relational norms, social capital, and social business dimensions. In the case of contract farming, evidence shows that the social aspect and social business-based contract farming model are over-sighted. This study offers an efficient social business contract farming model by, first, reviewing the conventional contract farming model and, secondly, by developing and proposing a robust, multidimensional model for contract farming. This proposed framework may have profound implications for the agriculture sector and may provide a strong sustainable contract farming management guideline for the global agriculture industry. Keywords: sustainable agriculture; social business; social capital; poverty reduction; relational norms 1. Introduction Contract farming has revolutionised the agriculture sector by improving agricultural productivity in both developing and developed countries. Realising the effectiveness of contract farming, non-government organisations, policy makers, donors, and researchers have proposed to governments, especially in developing countries, to promote and facil- itate contract farming to enhance agricultural productivity [1–5]. Contract farming is a legal agreement between a producer (grower) and a buyer (agriculture firm) for a specific duration on predefined conditions, which offers agricultural inputs and economic resources to the producer, whereas the producer, in return, allows agricultural firms to control and educate farmers about the quality and quantity of agricultural product [6–11]. Contract farming, however, is not without controversy. On one hand, contract farming offers numer- ous benefits to small-scale farmers, such as risk-sharing, access to higher-value markets, credit services, inputs at lower rates, reduction in transportation and marketing costs, access to technology, and access to training and technical assistance by large agricultural firms. On the other hand, despite all of the benefits, there are numerous criticisms of the negative effects of contract farming on poor farmers. [12,13]. Researchers, such as [2,14–20], have shed light on the drawbacks of contract farming. Researchers, including [14–16,21–25] have reported that many farmers regret participating in contract farming. Their complaints include monopolistic exploitation due to the bargaining power of buyers, unfair payment for agricultural produce, high input costs due to a constant demand for high quality, and high credit ratings. Additionally, refs [22–26] have raised concerns over the written contracts, including the legal language of the formal written contracts; missing elements or relational elements, even in very well-written formal contracts; weak judicial procedure; weak contract enforce- ment, especially in developing countries; and the inability of small-scale poor farmers to afford legal assistance in cases of contract violation by agricultural firms, leading to small scale farmers eventually losing their autonomy [2,26,27]. Relational informal contracts Sustainability 2021, 13, 12680. https://doi.org/10.3390/su132212680 https://www.mdpi.com/journal/sustainability