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An HPG Background PaperJune 2007
HumanitarianPolicy Group
hpg
Overseas Development
Institute
Business engagement inhumanitarian relief: keytrends and policy implicationsAndrea Binder and Jan Martin Witte
Study commissioned by theHumanitarian Policy Group ofthe Overseas DevelopmentInstitute (ODI)
About the authors
Andrea Binder is a Research Associate with the Global Public Policy Institute (GPPi). Jan MartinWitte is an Associate Director of GPPi. The authors would like to thank Cecily Brewer, Wade Hoxtell,Oliver Sanderson, Anita Hurrell and Ji-Hae Kim (all with GPPi) for research and editing assistance.The views expressed in this paper are entirely the authors’ own.
Humanitarian Policy GroupOverseas Development Institute111 Westminster Bridge RoadLondonSE1 7JDUnited Kingdom
Tel: +44(0) 20 7922 0300Fax: +44(0) 20 7922 0399Website: www.odi.org.uk/hpgEmail: [email protected]
© Overseas Development Institute, 2007
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HPG BACKGROUND PAPER
List of abbreviations
CERF Central Emergency Relief Fund
CMM Conflict Management and Mitigation
CAP Consolidated Appeal Process
CARE Cooperative for Assistance and Relief Everywhere
CSR Corporate Social Responsibility
DFID Department for International Development
DRI Disaster Relief Initiative
DRN Disaster Resource Network
ECHO European Commission Humanitarian Aid Office
HRI Humanitarian Relief Initiative
ICRP Instability, Crises and Recovery Program
MAC Managing African Conflict
MSI Management Systems International
MSF Médecins Sans Frontières
ODA Overseas Development Assistance
OECD Organisation for Economic Cooperation and Development
PADCO Planning and Development Collaborative International
UNDP United Nations Development Programme
UN OCHA United Nations Office for the Coordination of Humanitarian Affairs
USAID United States Agency for International Development
WFP World Food Programme
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This paper was commissioned by the Humanitarian PolicyGroup (HPG). It is part of a broader HPG study into the role ofthe private sector in support of humanitarian action. Thispaper contributes by exploring systematically the new rolescompanies are playing in humanitarian action. It assesses theforms such engagement is taking, with a particular focus onpartnerships, and explores the underlying motivations forengaging in new ways. It also addresses whether new forms ofcorporate engagement and new donor funding patternsrepresent potential competition to humanitarian actors, andhow this impacts on humanitarian principles. The paper is aproduct of a scoping exercise to assess the depth and natureof non-commercial and commercial business engagement inhumanitarian relief; eight illustrative case studies; andinterviews with numerous experts and practitionersconducted over 2006 and early 2007.
Key findings from the research show that businessengagement in humanitarian relief has expanded in scopeand size in recent years – in both voluntary and commercialways. A range of factors, the most prominent of which are tocontribute to positive branding and to motivate staff, drivescompanies to engage in humanitarian work. Companieswishing to pursue partnership arrangements tend to preferin-kind assistance to cash aid. The vast majority ofengagement relates to natural disaster relief, however, andthe value of such engagements in financial terms remainssmall, relative to overall humanitarian financing. Perceptionsof a growing trend of non-commercial company engagementin humanitarian relief may be based largely on effective
public relations/brand management campaigns bycompanies involved in this field.
The widely-held perception that companies increasinglycompete on a commercial basis with traditional humanitarianactors seems overstated. This perception may have beeninfluenced by the highly publicised instances of corporationsreceiving large USAID contracts during the Afghan and Iraqwars. To date, commercial business engagement seems to belargely limited to reconstruction and long-term development.
Partnerships with businesses can bring needed technicalexpertise and added capacity – but developing a strongworking relationship takes time and effort. Past attempts topursue partnerships with corporate agencies have often beenfrustrated as agencies are unclear about the intendedoutcomes for the partnership, or view it as a way of developinga long-term funding arrangement. Partner selection should bebased on a match between identified gaps, the skills andcapacities on offer and the ability of the agency to manage thepartnership. Equally, companies should seek not to limitthemselves to natural disasters or high-profile cases – positiveimage is based on credibility and, in the long run, respondingto greatest need will contribute more to such credibility thanopportunistic efforts. Finally, companies should be moretransparent about the contributions they make tohumanitarian relief. Research in this area is hampered bycompanies’ reluctance to provide privileged information,irrespective of whether their engagement is based on acommercial or non-commercial model.
Executive summary
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For decades, companies have occupied a secondary place inhumanitarian relief, providing goods and services to dominanthumanitarian actors contracting their assistance. However,recently the business community has started to respondunconventionally to needs arising from humanitarianemergencies, offering more than just logistical support or thedelivery of construction materials on a fee basis. This suggeststhat new forms of business engagement in humanitarian reliefmay be emerging.
One new form of engagement is partnership betweencompanies and traditional humanitarian actors to improvedisaster relief services. These partnerships are voluntary.Companies often claim that their participation in suchcollaborative alliances is not primarily, if at all, motivated byfinancial incentives, but is rooted in a desire to demonstratetheir corporate social responsibility (CSR).1
A second change in corporate engagement is the enlargedscope of traditional work. In the crises in Iraq and Afghanistan,humanitarian practitioner have reported that companies nolonger merely procure goods and services for traditionalhumanitarian actors, but in a number of cases appear tocompete with them for humanitarian budgets.2 While mostdonors give humanitarian funds only to non-profit organis-ations, the US and UK contract commercial providers directly toplan and implement humanitarian projects. However, so far thisseems to be related more to reconstruction and developmentthan to actual relief operations – particularly in the US case(SIGIR Report to Congress, 30 July 2006: Appendix H).
These developments have given rise to much discussionwithin the humanitarian community regarding the role of theprivate sector in humanitarian relief. Critics and supportersalike argue that the two trends sketched out above, ifsignificant and durable, have the potential to transform thehumanitarian domain. Critics fear that these trends willsolidify donor control over the implementation of reliefactivities. Companies, they assume, are less inclined todefend their independence vis-à-vis their paymasters thanNGOs. More significantly, critics fear that the increasingengagement of companies serves to weaken the application ofhumanitarian principles. As profit-maximisers, companies aresupposedly less concerned about humanitarian principlesthan are humanitarian NGOs (Hopgood, 2005: 4). Critics alsofear that companies’ voluntary contribution may not merely bea step towards increased engagement, but may eventually
crowd out donor funding altogether. In contrast, supporters ofbusiness engagement in humanitarian relief highlight thepotential for making relief work more effective and efficient.They argue that business can bring value to humanitarianrelief, including expertise, new technology and in some casesmuch-needed funds (Globalgivingmatters, 2005). Introducinggreater competition into the humanitarian ‘marketplace’ couldpotentially reduce inefficiencies and increase value for money.
All of these issues merit further discussion. In order to assessboth sides of the argument, it is first necessary to appraise thetrends and assess their implications. This report attempts tocontribute to the study of company engagement inhumanitarian action by exploring systematically the new rolescompanies are playing in humanitarian action. It assesses theforms such engagement is taking, and explores its underlyingmotivations. It also addresses whether new forms of corporateengagement and new donor funding patterns representpotential competition to humanitarian actors, and how thisimpacts on humanitarian principles. To address these issues,we have conducted a scoping exercise to assess the depth andscale of non-commercial and commercial business engagementin humanitarian relief; conducted eight illustrative case studies;and interviewed numerous experts and practitioners.
Company engagement in humanitarian relief, especially on anon-commercial basis, is a relatively new phenomenon. Existingliterature is rare and data collection proved difficult. The scopeof the study was limited in several ways. The report looks atdirect forms of business engagement – not at companies asdonors. Furthermore, while small-business initiatives play themost significant role in local relief operations, they are not likelyto have the overarching programmes of larger companies, norare they likely to be involved beyond the local level (see IFRC,2005: Chapter 4). The focus here is thus more on global ratherthan local businesses. The report does not assess longer-termissues related to reconstruction and development. It looks atbusiness engagement in natural disaster and conflict response– excluding security companies and non-relief-related post-conflict reconstruction (discussed extensively in Wheeler andHarmer et al., 2005). A systematic evaluation of the value ofbusiness engagement in humanitarian relief lies beyond thescope of this study. So far, assessments are ad hoc, anecdotalor unavailable. Given these limitations, this study should beregarded as a contribution to the evolving debate on the role ofthe private sector in humanitarian relief.
Our research revealed the following findings:
• In terms of the absolute number of corporate non-commercial initiatives, a growth in engagement can be
Chapter 1Introduction
1 Business engagement of this type is referred to as ‘non-commercialengagement’ in the text. 2 Interview with a representative of a network organisation of humanitarianand development NGOs, 12 May 2006.
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observed. The majority of these corporate-led initiativesemerged in the aftermath of the 2004 Indian Oceantsunami. The vast majority of these initiatives are relatedto natural disasters, rather than conflict settings.
• The significance of non-commercial engagement in termsof funds generated for relief remains relatively small.Perceptions of a growing trend in non-commercialcompany engagement in humanitarian relief may be basedlargely on effective public relations/brand managementcampaigns by companies involved in this field.
• Business engagement mainly occurs in one of three forms:as single company initiatives, as partnerships withtraditional humanitarian actors, or as ‘meta-initiatives’ (foran explanation of these three types of businessengagement, see chapter 3.1).
• Companies are motivated by a range of factors. The mostprominent are positive branding and a desire to motivatestaff.
• The widely-held perception that companies increasinglycompete on a commercial basis with traditionalhumanitarian actors seems overstated. This perceptionmay have been influenced by the highly publicisedinstances of corporations receiving large USAID contractsduring the Afghan and Iraq wars, as well as confusion overwhich budgets such contracts come from (developmental,humanitarian or other).3
• To date, commercial business engagement seems to belargely limited to reconstruction and long-term develop-ment.
• Irrespective of whether their engagement is based on acommercial or non-commercial model, companies appearreluctant to provide privileged information. Many companyrepresentatives do not have time to participate in studiesthat are not beneficial to their businesses. The fact thatcompanies do not provide information may also indicatethat there is little of substance to report.
The study is structured as follows. Chapter 2 places thediscussion of company engagement in humanitarian relief withinthe broader debate on recent changes in the humanitariandomain. Chapter 3 focuses on the non-commercial engagementof companies in humanitarian relief, through partnerships withtraditional humanitarian actors or participation in unilateral CSRinitiatives. Chapter 4 analyses the commercial engagement ofcompanies in humanitarian relief. Finally, chapter 5 offers policyrecommendations for traditional humanitarian relief agencies,government donors and the private sector.
3 Phone interview with an NGO representative, 21 April 2006. The GDAReport 2006 states, however, that reconstruction of countries such asAfghanistan and Iraq is increasingly funded out of development assistancerather than humanitarian budgets (Development Initiatives, 2006: 8).
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A substantive assessment of the changing role business playsin humanitarian relief requires a good understanding of boththe structure of the humanitarian domain, and the nature of theprivate sector. Generally, business actors respond to direct orindirect economic incentives. Some of these, such as demandor (financial) opportunity, are also relevant to the behaviour ofhumanitarian actors. Other economic rationales, such as profit-making or maximising efficiency in order to increase profits, arelittle known to humanitarian actors. Most importantly,however, what distinguishes the two types of actors is priority:whereas economic incentives are imperative to businessactors’ behaviour, they are only secondary for humanitarianactors. Therefore, to fully appreciate how private sector actorsperceive the structural context of their engagement inhumanitarian relief, we believe it is appropriate to use themarket as an analogy for the humanitarian domain.
2.1 The transformation of the humanitarian domain: an
emerging market?
During the past several decades, the humanitarian sector hasbeen dominated operationally, and in terms of funds received,by a handful of non-profit relief agencies rather than bycommercial or state actors. This dominance, combined with theneutrality and independence of providing care, has long kepthumanitarian action at the margins of international politics(Levine, 2004: 1). Until the late 1980s, humanitarianism ‘barelyexisted as a field’ (see Barnett, 2005: 729). Since the early1990s, however, this has started to change, as a result of threekey developments.
First, since the 1990s natural disasters have become morefrequent and visible (see Calhoun, 2004). This has led toapparent growth in the ‘market’4 for humanitarian assistance,not only in terms of financial volume but also in terms of thenumber of market participants (World Bank, 2006: 5). Thisgrowth is reflected in the dramatic increase in official assistance,from $2.3 billion in 1990 to approximately $8.4 billion in 2005(Development Initiatives, 2006: 7). As a percentage of officialdevelopment assistance (ODA), humanitarian aid rose from an
average of 5.8% for the period 1989 to 1993 to 14% in 2005 (seeDevelopment Initiatives, 2006: 8). Private contributions tohumanitarian assistance also increased significantly. Accordingto OCHA’s Financial Tracking Service, private contributions rosefrom 14% of total humanitarian assistance in 2001 to about 35%in 2005 (http://ocha.unog.ch/fts2/).
In both official and private spending on humanitarian assistance,there is great variation from year to year. Practitioners complainthat donors often respond disproportionately to emergencies, ascontributions are not always made where the need is greatest,but rather serve donors’ own political agendas and priorities.Resources are concentrated on high-profile emergencies, andthere is an observable bias towards quick-onset disasters at theexpense of slow-onset and chronic disasters (see Levine, 2004:5; Development Initiatives, 2006: 28). Nonetheless, whencompared to development aid, humanitarian assistance spend-ing has shown stronger growth rates over the past few years.Following the trend of preceding years, in 2005 humanitarianspending grew faster than ODA as a whole (DevelopmentInitiatives, 2006: 7).5 The 2005 financial flows are significantlyinfluenced by the unprecedented response, both private andpublic, to the Indian Ocean tsunami (Development Initiatives,2006: 49). The steady increase in financial assistance since theearly 1990s, as well as the expansion of actors involved, hasintensified competition for funding and projects. This, manybelieve, has created new coordination problems in the field (seefor example Minear, 1999; Reindorp and Wiles, 2001).
Second, because of increasing competition and large-scale,well-publicised failures to respond to major disasters such asthe Rwandan genocide, there have been pressures from withinthe community and from donor governments to professionalisehumanitarian work (see Terry, 2002).6 In particular, the latterhave started to press for greater accountability and the
Chapter 2The humanitarian domain:
key trends and developments
4 Using the term ‘market’ in the context of humanitarian relief isproblematic. Helping people who are suffering physically and mentally fromthe effects of natural and man-made disasters is not a typical business. It isreasonable to argue that the system that brings aid to those who have losttheir loved ones, their homes and means of living due to natural disastersor wars, should probably not be compelled to function according to marketlaws. But for better or worse, an industry has developed aroundhumanitarian aid, permitting us to speak of a humanitarian ‘market’. Thetrade fair in Dubai at the beginning of 2006, the largest ever held, is a goodexample of this trend.
5 ODA net of debt relief, humanitarian spending including relief disbursementin response to the tsunami (Development Initiatives, 2006: 7).6 De Torrente (2005: 3ff ) distinguishes between three different but relateddimensions of professionalisation. One dimension is that, in response togrowing complexity, activity in humanitarianism is becoming a profession,which demands a specific profile, and thus specific training. At the sametime, humanitarian professions are becoming more diverse. Whiletraditional activity in the field remains at the core of humanitarian activity,increasingly administrative, managerial and organisational posts arenecessary to coordinate and organise humanitarian work within anindividual organisation. This development is linked to a second dimension,whereby employment in the humanitarian field is increasingly moving fromvoluntary to paid work. These two dimensions of professionalisation can beseen as a result of the drive towards the enhanced effectiveness ofhumanitarian work. The third dimension is, therefore, the increasedbureaucratisation of humanitarian work, and a move away fromimprovisation and informality.
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adoption of business management approaches – such as agreater division of labour, specialisation, formalisation andstandardisation of workflows. The pressure to professionaliseis also reflected in the growing use of business language andbusiness tools amongst humanitarian practitioners (seeBarnett, 2005: 725; Levine, 2004: 1ff; de Torrente, 2005). Inresponse to reviews of a number of crises, such as Rwanda andSudan, and critiques from within the humanitarian communityand from donors, there have been attempts to standardise thepreviously informal rules guiding humanitarian action (seeBarnett, 2005; Gostelow, 1999).7 This has led to a proliferationof principles and codes of conduct (see Barnett, 2005; Levine,2004; Hopgood, 2005; Anderson, 1999). At bottom, each ofthese codes and principles depends on concepts of humanity,neutrality and impartiality.
Finally, since the end of the Cold War humanitarianism hasincreasingly become both a means and an end of foreignpolicy; civil and military interventions for humanitarianpurposes are increasing and some argue that they haveemerged as an organising principle of today’s internationalrelations (see Macrae, cited in Levine, 2004: 3). As a result,governments now seek to exert greater control over howresources are spent (Barnett, 2005: 731). Funding decisionsare often based on political interest (Levine, 2004: 4). At thesame time, the increasing dependence of many humanitarianactors on governmental donors makes it easier for the latter toinfluence the work of the former: ‘The most important controlmechanism [comes] from the power of the purse’ (Barnett,2005: 731). Today, more than two-thirds of available publicfunds are spent bilaterally (Development Initiatives, 2006: 7).This increased presence of donor governments in thehumanitarian sphere, and the funding patterns that result,affect both traditional, non-profit actors and for-profitcompanies alike (see Barnett, 2005: 725; Levine, 2004: 3).
The convergence of these three developments seems to havecreated a friendlier atmosphere for commercial engagement inhumanitarian relief: for-profit actors should quite naturally beattracted by the growth of the market; they already possessthe business management tools governments increasinglydemand; and donors may see for-profits as more willing tocomply with their directives than NGOs. However, beforejumping to conclusions we need a better understanding of thestructure and dynamics of the humanitarian domain.
2.2 The humanitarian domain as a quasi-market
dominated by several big players
A closer look at the fundamental structure and dynamicsunderpinning the humanitarian endeavour gives us reason tobelieve that commercial engagement will not necessarilybecome widespread.
The humanitarian market is probably best characterised as aquasi-market (Harford, 2004: 3). Quasi-markets exhibit anindirect producer–consumer relationship. In regular markets,consumers purchase goods and services. In the market forhumanitarian relief, however, the consumer (i.e. the aidrecipient) neither purchases nor pays for the delivered service.Rather, public or private donors finance the transaction. Inother words, there is an indirect producer–consumerrelationship: aid agencies are the producers, donors the buyersand aid recipients the consumers. As a result, the market isloaded with asymmetries. Donors have difficulty determiningwhether the services they pay for are indeed adequatelydelivered, while recipients have few means of effectivelymaking complaints or airing grievances. This in turn results inmoral hazards, such as weak incentives on the part of the aidagency to deliver good-quality services efficiently. Political andinformation asymmetries are common factors preventing themarket from performing to its full capacity (see Easterly, 2002;Harford, 2004; Cooley, 2002; Rose-Ackerman, 1996).
These distortions of the humanitarian market exist regardless ofwhether the actors are for-profit or non-profit. From theperspective of economic theory, what distinguishes the twotypes of actors is that non-profits have a ‘non-distributionconstraint’ (Rose-Ackerman, 1996: 717). That is, non-profits haveneither shareholders nor owners, nor do they make any profit,and are thus not constrained to distribute their income to aspecific group of people. For-profits, on the other hand, need tocater to their shareholders or, if held privately, to their owners.8
The non-profits’ non-distribution constraint is legally required inmany countries, where not-for-profit actors cannot retainportions of the donations as income. As a result, not-for-profitshave fundraising advantages in a market where donors, bothprivate and public, want to be certain that the money spent(taxes in the case of government donors, earned income in thecase of private donors) will reach the beneficiaries rather thanincrease company profits (Rose-Ackerman, 1996: 717).9
A further characteristic of the humanitarian market is itsoligopolistic structure, on the demand as well as the supplyside. The demand side of the humanitarian market isdominated by a small number of NGOs, namely CAREInternational, World Vision, Save the Children, Oxfam andMSF, with annual budgets ranging from over $400 million toroughly $2 billion.10 The remainder of the market is
7 For example, the Code of Conduct for the International Red Cross and RedCrescent Movement and NGOs in Disaster Relief; the Providence Principlesassembled by a number of NGOs; and the SPHERE Project.
8 As Easley and O’Hara observe: ‘[I]n buying food for our own consumptionwe can observe the products we are purchasing. In donating money to feedEthiopian famine victims, however, we are not likely to travel to Ethiopia toobserve the delivery of the food. The non-profit’s non-distributionconstraint assures us that our entire donation will not end up in themanager’s bank account. If we donate to a for-profit firm, however, whatassurance do we have that the money provides food to Ethiopians ratherthan profits to the owners?’ (Easley and O’Hara, 1983: 532).9 Interview with a representative from the German government, 2 May2006.10 Information gathered from the organisations’ websites. In 2004, 21 NGOgroupings received 50% of all humanitarian spending channelled throughNGOs.
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distributed across a (steadily increasing) number of smallactors, which compete fiercely for market share (Barnett,2005). On the supply side, we find a handful of public donors,such as the US, the UK, the European CommissionHumanitarian Aid Office (ECHO), Sweden, the Netherlands,Switzerland and Canada – who together provide over 63% ofoverall humanitarian assistance (OCHA Financial TrackingSystem, http://ocha.unog.ch/fts/ index.aspx). The remainingaid is supplied by an increasing number of donors, bothprivate and public.
2.3 Conclusion
The analysis above highlights two important points. First, theongoing transformation of the humanitarian domain hascreated an atmosphere conducive to more extensive privatesector engagement in humanitarian relief. At the same time,an analysis of the fundamental structure of the ‘quasi-market’for humanitarian relief suggests that the ‘commercialisation’of relief is unlikely; traditional humanitarian actors, inparticular non-profits, enjoy a strategic advantage overpotential private sector competitors.
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For many years, the business community has been an activeand important contributor to humanitarian relief, primarilythrough its philanthropic activities. Corporate philanthropy inhumanitarian relief has steadily increased over the past severaldecades (Whiteman et al., 2005; Foundation Center, 2006).While exact figures vary, it is widely believed that corporatedonations reached a record high with the Indian Ocean tsunamiin 2004 (Whiteman et al., 2005; UN Office of the SecretaryGeneral’s Special Envoy for Tsunami Recovery, 2006: 5).
While corporate philanthropy remains important, companiesincreasingly appear to seek more direct ways of engaging inhumanitarian relief operations, for example through so-called‘partnerships’ or ‘multi-stakeholder initiatives’. Some companies– albeit much smaller in number – also engage directly in relief.
3.1 Results of scoping exercise
The scoping exercise used in this study was assembled largelythrough internet research and expanded on through interviews.It identified 61 initiatives in which the private sector engages inhumanitarian relief on a non-commercial basis (for a list ofinitiatives, see Appendix I).11 Overall, the scoping exerciseidentified a number of key elements of non-commercialbusiness engagement in humanitarian relief, which, together,constitute a new form of corporate engagement in this area.
Beyond sharing common ground to the extent that theengagement is non-commercial, the company initiativesidentified in the scoping exercise vary greatly with respect totheir development, structure, management and fundingarrangements. We categorised the initiatives into three groupsand identified trends based on industry sector, firm size, firmlocation, leadership commitment and a variety of otherfactors. These three types are:12
1) Single company engagement: initiatives launched andimplemented by a single corporation, which often emerge inresponse to a specific crisis and are most frequently plannedand executed by company CSR departments. Such
initiatives range from traditional philanthropy (e.g.coordinating company staff donations) to fully-fledged,company-run relief operations in disaster regions (including
Box 1: The IBM Worldwide Crisis Response Team
IBM, with annual revenues of $91.1 billion, was one of the firstmajor corporations to shift its strategy of corporate givingfrom philanthropy to unilateral business engagement indisaster relief (Woodworth, 2001; IBM, 2005).13 IBM’sWorldwide Crisis Response Team was launched in 1993 toestablish ‘initial response and recovery services for our IBMcommercial clients’ (see Agnew, 2005). Today, it also providespre-disaster risk assessment, insurance and disaster relief foremployees and their communities. It also offers IT goods,services and expertise in logistics and management togovernments and organisations in disaster response efforts.Since 1993, Crisis Response Teams have aided disaster reliefin 49 countries related to more than 70 major natural andman-made disasters (IBM, 2004; GPPi interview, 2006).
With the Crisis Response Team, IBM increased the impact ofits humanitarian contributions, and assured that its fundswould be used effectively (GPPi interview, 2006). It was alsopractical. The commercial branch of IBM has profited fromthe lessons learned, which have been incorporated into itsdisaster consulting practice, and from expertise gained inhumanitarian disaster relief.14 IBM’s expenditures ondisaster-related humanitarian action are not significantcompared to the profitability of its disaster consultingpractice, the Business Continuity and Recovery Services,which generates an estimated revenue of $600 million a year(see Lohr, 2001; Fortune Magazine, 2006).
IBM involvement at the national level follows either agovernment request for help or an IBM-initiated discussionwith high-level government officials about its potential role.Once invited to engage, an IBM Crisis Response Team oftrained experts works alongside local volunteers, businesspartners and other humanitarian relief organisations (Agnew,2005; IBM, 2005; GPPi interview, 2006). To encouragesustainability, the teams develop an exit strategy and trainlocal people for eventual takeover. At the close of operations,the teams assess their performance and identify lessonslearned for the future (GPPi interview, 2006).
Chapter 3The new face of corporate philanthropy?
The changing nature of business engagement in humanitarian relief
11 The list of initiatives is not exhaustive. The method of identifying casesprimarily through internet research and expert interviews is biased towardslarger initiatives, which are able to communicate their work effectively. Inaddition, this selection does not include traditional corporate cashdonations.12 This is not an analytical typology. This categorisation is used here as aheuristic device in order to illustrate the breadth of non-commercialbusiness relief in humanitarian relief.
13 Interview with a representative of IBM’s Crises Response Group, June 2006.14 The IBM commercial crisis management services website advertises theexpertise gained in past humanitarian crisis responses (see www-1.ibm.com/services/us/index.wss/offering/bcrs/a1000265 06).
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self-standing initiatives engaging through in-kind donationsand through involving company staff in the managementand implementation of relief operations).
2) Partnerships. Partnerships refer to multi-stakeholder initia-tives that bring together corporations and traditionalhumanitarian actors such as the United Nations, bilateraldevelopment organisations and/or NGOs.15 This arrange-ment was the most common type of initiative identified in thescoping exercise (with 52 examples). The number of organis-ations involved in a partnership varies greatly: many bringtogether only two partners (business–NGO; business–
government), while others have developed into broad-basedinitiatives with ten or more collaborating organisations.
3) Meta-initiatives. Meta-initiatives involve companies andother actors joining forces to enhance coordination inhumanitarian relief work and to share lessons learned. Thestated goal of some meta-initiatives, such as the DisasterRelief Initiative (DRI), also includes the establishment ofstandby capacity, often in addition to engagement throughCSR initiatives and/or partnerships. Various meta-initiativeshave been launched, facilitated by business associationssuch as the World Economic Forum or the Fritz Institute.Meta-initiatives are designed to facilitate more effectiveindustry-wide action in humanitarian relief, to avoidduplication of effort and to take advantage of economies ofscale. They also seek to overcome the limitations of the adhoc nature of giving in emergency response. They aim atsystematising and formalising response.
15 Broadly speaking, partnerships can be described as voluntary andcollaborative initiatives that bring together actors from various sectors(including business, civil society and the public sector) to achieve a commonobjective or undertake a specific task, and to share risks and responsibilitiesas well as resources and benefits. For a more in-depth discussion of the term‘partnership’, see Witte and Reinicke, 2005: chapter 2.
Box 2: Motorola’s partnership with Care
International
Communications technology company Motorola, Inc. hadannual sales of $27.1 billion in 2003. It initiated a partnershipin 2004 with CARE International. CARE has an annual budgetof approximately $565 million (CARE, 2005). According toCARE’s president and CEO, Peter Bell, the partnership seeksto ‘link isolated communities to the outside world and helpsave lives’ by providing remote areas with communicationstechnology. Motorola has donated radio communicationssystems in Bangladesh, the Democratic Republic of Congo(DRC) and Peru. Motorola’s donation is valued at $1 million.
According to Motorola, its motivation for engaging in thepartnership with CARE is that it constitutes ‘an excellentopportunity for us to leverage our expertise in radiocommunications and make a significant contribution to thecommunity’ (Motorola, 2004). In addition, Motorola offers itsproducts and services for the purposes of humanitarian reliefat least in part to establish a presence in new markets.Administratively, Motorola’s marketing, sales and fieldservices sections are all involved in the management andimplementation of the partnership (GPPi Interview, 2006). Sofar, there are no publicly available evaluations of the effects ofthe partnership. However, CARE and Bangladeshi governmentrepresentatives highlighted Motorola’s positive contribution,stating that its radio device donations could servecommunities by improving household security (see http://www.thedailystar.net/2004/12/01/d41201160398.html).
There are plans to expand the scope of the partnership.Motorola recently made an additional grant to CARE to helprebuild schools following the earthquake in Pakistan in2005. There are continuing discussions around how CAREand Motorola could form a partnership in India. Thewillingness of Motorola to expand its partnership with CAREis a testament not only to its success, but also to Motorola’sdesire to continue exploring new market potential indeveloping regions.
Box 3: The Disaster Resource Network (DRN)
The Disaster Resource Network (DRN) was established by theWorld Economic Forum in 2001. It is envisaged as a bridgebetween traditional relief actors and businesses willing tocontribute to the prevention and mitigation of disasters. Themission of the DRN is ‘to mobilise the resources of theinternational business community to rebuild the lives andlivelihoods threatened by natural and man-made disasters’(see http://www2.drnglobal.org/home). DRN relief effortsinclude sending medical emergency teams, shipping reliefsupplies, donating emergency communications technologyand computers and deploying Airport Emergency Teams(AETs) of logistics experts and heavy equipment operators torun airport operations in disaster areas. Through the DRN,World Economic Forum members have contributed to reliefefforts following the 2004 tsunami; Hurricane Katrina in theUnited States; the November 2005 earthquake in South Asia;and the May 2006 earthquake in Indonesia.
The DRN identifies gaps in existing relief efforts andapproaches companies capable of filling them. Since 2001, theDRN has worked with a variety of local actors in affectedregions as well as traditional humanitarian assistanceorganisations (GPPi interview, 2006; DRN: http://www.weforum.org/pdf/Indonesia.pdf, 2006). Businesses donateboth financially and in-kind, and give finances either to aspecific disaster or through sustained unspecified giving. Ingeneral, contributions range from $500 to $300,000 (seeWorld Economic Forum, 2003). The DRN estimates the AET’scontribution at $1.7 million in volunteer labour and services tothe tsunami emergency relief effort.16 Between $300,000 and$500,000 is kept as reserves by the DRN so that it can respondto disasters immediately. DRN involvement in a disaster isbased on UN and NGO requests for relief aid; however, AETdeployment requires the agreement of the local government.
16 See www.weforum.org/site/homepublic.nsf/Content/Disaster+Resource+Network%3A+Current+Projects.
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Company contributions to humanitarian relief range fromdonations of immediate aid supplies (food, water, blankets) tologistics (providing free transport as well as improvinglogistical systems and efficiency), technology (especiallycomputer hard- and software), communications equipmentand monetary donations. Companies from a broad range ofindustry sectors have engaged in humanitarian relief on a non-commercial basis, but three sectors appear particularlyprominent – logistics, information technology (IT) andtelecommunications – due to the relevance of contributions inthese three sectors to disaster relief operations.
The majority of non-commercial initiatives in the scopingexercise focus on major sudden-onset natural disasters ratherthan man-made disasters, such as conflicts, or gradual-onsetdisasters, such as droughts.17 Interviews with companyrepresentatives suggest that corporations tend to avoid post-conflict disaster relief because of the associated dangers –related to their security and their standing in relevantcommunities.18 Post-natural disaster relief is ‘easier tonavigate’ and involves fewer complex questions about liabilityand insurance for company staff working at the site of thedisaster. Engagement in post-conflict relief may also raise
reputational issues, such as being associated with the conflictor being forced to take sides. In cases where businesses doengage in post-conflict disaster relief, it is usually not in theform of partnerships but indirectly, for instance throughfundraising or providing technology to be implemented bytraditional humanitarian agencies.
The scoping exercise indicated that the vast majority ofinitiatives emerged immediately after the 2004 tsunami (seeFigure 1).
Figure 1 demonstrates that the tsunami was a catalytic event,helping to increase awareness of and active contributions tohumanitarian operations within the business community. It isquestionable, though, whether business support followingmajor events such as the tsunami will be sustainable over time(see also section 3.3).
Our research shows that the average size of initiatives,measured by budgets per annum, is approximately $2 million(see Appendix I). The largest initiative has an annual budget of$10 million (TNT’s ‘Moving the World’), while the smallestinitiative has a budget of $10,000 (the partnership betweenBrandix Lanka and UNDP). Assembling budget data for theseinitiatives proved extremely difficult. In most cases, data is notpublicly available and was not provided at our request. Only aminority of initiatives (22) surveyed provided exact data onfunding. Moreover, even when budget data is provided, theexact time period for allocated budgets is often unclear, and itis not clear whether companies calculate their contributionsaccording to market rates, or internal ones. Interviews suggestthat market rates are used, which would mean that the actualfinancial commitments are overstated.
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Figure 1: Founding dates of initiatives
1995–1999 2000 2001 2002 2003 2004 2005 2006
Type of engagement
SCE PPP Meta initiative
17 For a similar finding in the disaster prevention arena, see Warhurst,2006. Health disasters such as the SARS and AIDS epidemics were notconsidered in the scope of this report.18 Without exception, all corporate interviewees noted a clear preferencefor working in humanitarian relief operations after natural disasters. Thisprobably related to the fact that the nature of conflicts has changedsignificantly over the past decade. While inter-state conflicts continue toattract significant attention and media coverage, the predominant numberof new conflicts are low-intensity yet often protracted civil wars (see e.g.Collier et al., 2003). The changing structure and intensity of conflictsgenerates a range of new challenges for efforts not only in conflictprevention but also in post-conflict relief, reconstruction and development.
Source: GPPi.
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3.2 Analysis and conclusions
The scoping exercise provides a broad and illustrative, yet to alarge extent descriptive, picture of the breadth and scope ofnon-commercial business engagement in humanitarian relief.For that reason, we also conducted five case studies (seeAppendix III). Based on the scoping exercise and the casestudies, what conclusions can we draw in relation to the keyresearch questions raised at the outset?
3.2.1 Significance of non-commercial business engagement
in humanitarian relief
The scoping exercise suggests that the non-commercialengagement of business has become an increasingly commonfeature of the humanitarian relief domain. During the pastdecade, the number of partnerships and CSR initiatives inhumanitarian relief has increased significantly. However, thismust be viewed in perspective.
First, it is important to recognise that much of the growth innon-commercial business engagement was primarily driven bythe Indian Ocean tsunami in 2004. More than 90% of theinitiatives in the scoping exercise were launched in response tothat catastrophe. Since then, the growth rate in new initiativeshas levelled off. Based on the number of new initiatives andcompanies engaged, there are no signs that there is consistentand significant growth independent of large-scale disasters. Infact, non-commercial business engagement in relief has notbeen as significant in other disasters (such as the Kashmirearthquake in 2005), suggesting that the tsunami may havebeen a singular event. At the same time, the fact that theoverall number of non-commercial business initiatives is notgrowing may also be a result of an ongoing process ofconsolidation. Various companies appear to be joining forces inmeta-initiatives, with the intention of enhancing coordinationand learning. Humanitarian relief experts see this as a positivephenomenon, since the new meta-initiatives tend to reducetransaction costs and help educate corporate managers in thecomplexities and intricacies of humanitarian relief work.19
Second, the significance of non-commercial engagement inhumanitarian relief should not simply be judged by thenumber of new initiatives and the number of companies thatare active. Another, probably more useful, indicator is thescale of overall funding being channelled into humanitarianrelief activities through these new types of initiatives. Whileconsistent and reliable data about the financial size ofinitiatives is difficult to obtain, our research suggests thattheir overall significance in terms of funding generated forrelief work remains small, at least in relation to overall
humanitarian aid budgets from private cash donations andgovernment donor contributions. The media attention some ofthese initiatives frequently attract stands in stark contrast tothe fact that the overwhelming number run on budgets wellbelow $500,000 per year. These numbers pale in comparisonto overall corporate philanthropic cash contributions, the sumtotal of private individual giving and, particularly, overallgovernment spending on humanitarian action (see chapter 2).In most cases, it is also unclear how corporate support will besustained as there are no multi-year funding commitments.
Of course, the level of funding that is available is notnecessarily an appropriate predictor of impact. As our casestudies suggest, even comparatively small initiatives have thepotential to develop significant impact and produce a variety ofpositive outcomes. This applies in particular to partnershipsthat are not only mechanisms for the delivery of humanitarianaction, but also effective conduits for knowledge exchange andlearning. Without exception, interviewees from both privateand humanitarian agencies with experience of partnershipsemphasised the positive impact of non-commercial businessengagement on the sector as a whole.20 UN intervieweeshighlighted the important role partnerships play in bringingknowledge and expertise into the UN (GPPi interviews, 2006).However, while individual initiatives and companies makenotable contributions to humanitarian relief, overall non-commercial engagement in humanitarian relief remains a nichephenomenon.
3.2.2 Forms and management of non-commercial business
engagement
Our research highlights two reasons why companies prefer toact through partnerships rather than alone. First, manycompanies recognise that becoming involved in themanagement and implementation of humanitarian relief canbe difficult and risky. Delivering aid in a post-conflict or post-disaster situation usually requires operating in very complexand frequently dangerous environments. Companies tend tolook for experienced partners to help them avoid mistakes andreduce risks (GPPi interviews, 2006). Second, companies arefrequently interested in building partnerships with well-knownand reputable NGOs or inter-governmental agencies, such asthe UN, in order to profit in terms of their image. HumanitarianNGOs such as Save the Children or CARE International havehigh and very positive international visibility. Associating acompany with such organisations can help to improve thatcompany’s public profile. In identifying suitable partners,companies tend to be highly selective. Competence and areputation for efficiency is another important selection factor.Companies also tend to choose partners that suit theirstrategic branding needs.
19 Interview with a UN representative conducted by the authors, 31 May2006. Various others supported that view, including for example BenedictePansier (Donor Relations Officer, World Food Programme) and RosTennyson (Director, The Partnering Initiative, IBLF) (comments made duringa workshop on the role of business in humanitarian/disaster relief at theAnnual Private Sector Focal Points Conference in Paris, 31 May 2006, jointlyorganised by the UN Global Compact Office, UNFIP and UNESCO).
20 In addition, Warhurst (2006: 6) notes that ‘through long-termcooperation and learning on both sides of the partnerships [in disasterrelief ], the humanitarian organisations find themselves increasingly able toengage with their corporate partners on prevention and mitigation, not justcrisis. This suggests that partnerships should be seen as learningjourneys’.
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In terms of the planning and management of humanitarian reliefwork, in most companies CSR or communications departmentsare in charge. There are a few examples (one is TNT’s ‘Moving theWorld’ initiative) where humanitarian relief activities areorganised in a completely separate department within thecompany. This is usually the case when the engagement is bothvery significant and long-term. There appears to be very littleintegration of humanitarian relief activities into core businessplanning and management structures. This separation does notappear to be directly correlated with the quality of thehumanitarian work companies do, although several intervieweespointed out that corporate engagement tended to remainprecarious inside the company if an initiative did not involvedepartments beyond CSR (GPPi interview, 2006). Given that aconsiderable number of initiatives are initiated by the CEO or aboard member, they frequently attract senior managementattention, which helps them maintain the necessary supportinside the company.21 Several interviewees noted that businessengagement is often un-strategic to start with (especially withrespect to partner selection, where to help and what to do), andbecomes more strategic over time (GPPi interview, 2006).
With regard to the modalities of funding such corporateengagement in humanitarian relief, in most companies activitiesare paid for out of the general CSR or communications budgets.In terms of sustainability, this can be problematic. Expenses forCSR are usually pure cost centres within a company, andtherefore tend to be subject to the vagaries of the business cycle,so that ‘defending’ CSR budgets within companies is usually noteasy. Much like traditional philanthropy, financial commitmentsto partnerships and other initiatives in humanitarian relief willincrease during good times, and decline during bad (see alsoWarhurst, 2006: 10; GPPi interview 2006).22 However, given thenovelty of the initiatives surveyed in this report, no conclusiveevidence exists to support this conclusion.
As corporate engagement in humanitarian relief matures,there appears to be a determined effort to professionalise thepractice. This is reflected in the growth of meta-initiatives suchas the DRN, which help companies share lessons learned andbest practice, and facilitate the coordination of futureactivities. This professionalisation frequently appears to becorrelated with a determined effort to enhance brand visibility(i.e. to maximise the reputational benefits of non-commercialengagement), and to reduce the direct cash outflow (inexchange for greater in-kind engagement).
None of the initiatives surveyed for this report had conducted athorough independent evaluation and/or impact assessment(see also Warhurst, 2006: 11). Without evaluation and impactassessment, it will be impossible to gather lessons learned and
best practice. The lack of impact assessment also inhibits properbenchmarking. Several companies (including IBM and TNT)conduct regular internal reviews of their engagement in disasterrelief work, but it is unclear to what extent these look at overallimpact and the management of the particular initiative, or theextent to which the results of such reviews are shared withpartners. In interviews, several business representatives agreedthat evaluation and impact assessment are needed, and notedthat, in the future, such activities would be launched. However,at this stage there appears to be little willingness to open upthese initiatives to independent and external evaluation.
3.2.3 Business motivation
In order to project how the non-commercial engagement ofbusiness in humanitarian relief is likely to evolve in the future,and to assess implications for traditional humanitarian actors, itis important to understand the motivations behind suchengagement. Our research suggests that there are four driversbehind the engagement of business in humanitarian relief: adesire to build a positive brand and to ‘insure’ against potentialfuture political crises; staff motivation; an attempt to gatherbusiness intelligence; and, finally, a desire to ‘do good’.Ultimately, the importance of each factor depends on thecompany in question, its location, its market position, and avariety of other factors.
Corporate image and identity
The increasing importance of CSR is frequently explained asthe result of rising external stakeholder pressure.23 Over thepast decade, companies – especially large transnationalcorporations – have faced increasing scrutiny, particularlyfrom advocacy NGOs pushing them to demonstrate theirenvironmental and social conscience. Consumers are also saidto have become more selective in their choices, preferring theproducts of companies that demonstrate a superiorenvironmental or social record (see Vogel, 2005: 49ff; DePelsmacker, Driesen and Rayp, 2005).
None of the company representatives interviewed for thisstudy regarded direct stakeholder pressure as the only or evenmost decisive driver behind their decision to engage inhumanitarian relief.24 Rather than a reaction to externalpressures, many business interviewees explained theircompany’s engagement primarily as an investment inproactive brand-building25 and reputation management, and
21 Several interviewees highlighted the crucial importance of seniormanagement ‘buy-in’ and continued support to partnerships or CSRinitiatives in the humanitarian domain.22 On the more general ‘slack resources theory’, see Waddock and Graves,1997.
23 The most significant group that has started to put pressure oncompanies is advocacy NGOs. There is ample evidence to demonstrate theimpact NGO advocacy can have on a company’s business. This applies inparticular to brand-sensitive corporations (see also Little, 2001: 1). 24 Many made reference to the increasing pressure of civil societyorganisations on companies to ‘behave responsibly’. None, however,established a direct link between their current engagement in humanitarianrelief and direct advocacy pressure exerted by NGOs.25 Note that branding cannot be confused with PR activities. In contrast toPR, which is short-term and changes considerably over time, branding is along-term strategy. Branding aims to build up a company’s identity in verygeneral terms. It is targeted at consumers and also at future employees andinvestors. In other words, PR is the slogan, branding the idea behind it.
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an opportunity to contribute to the communities in which theyoperated. Engagement in humanitarian relief on a non-commercial basis is part of a strategy to establish the companyas a good corporate citizen. This is in part ‘insurance’ againstpotential future problems (building up brand equity,establishing relations with external stakeholders that may beuseful later), and in part a strategy to reach out to consumers,clients, suppliers and other relevant stakeholders.
Staff motivation
A second driver behind corporate engagement in humanitarianrelief, and the one most frequently highlighted by interviewees,is the desire to motivate staff (GPPi interviews, 2006; see alsoCampher, 2005; Warhurst, 2006). Ultimately, the goal is eitherto increase the company’s appeal to new talent, or to keepexisting staff on board, thereby reducing staff turnover. Theidea is that a company that is seen to be an active ‘corporatecitizen’ helping to ameliorate human suffering from disasterswill enhance staff morale and staff identification with thecompany (see also Warhurst, 2006). Several studies haveshown that companies with a demonstrable commitment toCSR are more effective performers in the ‘war for talent’ (see forexample Tamkin et al., 2000; OECD, 2001).
It was also suggested that the impact of CSR on company staffis most effective where staff members become directly engagedin humanitarian relief operations.26 A company that is donatingmoney (for example by matching staff donations) is seen as a‘good company’, but the effect on staff morale and motivation isless direct than in cases where companies facilitate staffvoluntary participation in disaster response teams, as IBM,Deutsche Post World Net and TNT do. There have been efforts toquantify the benefits of increased staff morale from suchactivities, such as regular surveys conducted by TNT to assessthe relevance of the partnership with WFP for TNT staff. Thesuccess of the initiative, and the remuneration for its manager,is determined at least in part by the outcomes of thesesurveys.27 So far, however, publicly available consolidated dataon the relationship between CSR engagement in humanitarianrelief and staff morale does not exist.
Knowledge transfer and learning
A third significant driver behind business engagement appearsto be the desire to learn from participation in humanitarian reliefoperations and to use this ‘intelligence’ to enhance businessperformance. This is especially relevant for industries wherelessons from humanitarian relief operations may have somebearing on regular business operations and product develo-pment, in particular telecommunications and logistics. Suchlearning can be relevant for companies in a variety of ways:
• Engagement in disaster relief can tell companies how bestto deal with supply chain interruptions. Relief operations
often take place in the most difficult circumstances, whereinfrastructure is frequently damaged or completelydestroyed.
• Disaster relief operations can teach businesses importantlessons about how to operate in difficult social, politicaland environmental conditions. This includes enhancingbusinesses’ cultural sensitivity, which in turn enables themto test and optimise internal management.
• It has been noted that business is itself frequently a victimof natural or conflict-related disasters. Many companieswere directly affected during and after the Indian Oceantsunami. As a consequence, many companies have starteddeveloping disaster response strategies, and are takingsteps to safeguard themselves against disasters and theirconsequences. Engagement in disaster relief operationscan help them to learn about which strategies work andwhich do not (Twigg, 2001).
• As explained above, engagement in disaster reliefoperations can facilitate product development and add toa company’s record as a reliable service provider instressful situations. This is certainly one of the benefitsIBM derives from its non-commercial engagement, for itsBusiness Recovery Unit. As one interviewee noted, somecompanies also send beta versions of new products torelief operations to expose them to vigorous testing in thefield (GPPi interview, 2006).
Another related instigator of corporate engagement is the desireto ‘network’ with actors to whom they otherwise do not haveaccess, in particular NGOs and the United Nations; many of thehumanitarian relief initiatives with corporate participationappear to serve as platforms for multi-sectoral dialogue.
The likely benefits of engagement in disaster relief operationsshould not be overstated. For example, interviewed expertsfrom logistics firms noted that relief logistics and corporatelogistics were fundamentally different. Deutsche Post WorldNet, for example, does not expect to extract much usefulbusiness intelligence from its partnership with UNDP andOCHA (GPPi interview, 2006).
‘Doing good’
Finally, partnerships and CSR initiatives in the humanitarianrelief domain tend to flow from a company’s effort to ‘do good’or to ‘give something back to society’. In such cases, initiativesare often leadership-driven.28 Company executives or boardmembers often feel personally committed to a cause, and arewilling to contribute resources to it.29
There is a tendency among researchers and practitionersfocusing on the business case for CSR either to ignore such
28 See also Twigg, 2001, on the importance of leadership in disaster-relatedCSR initiatives.29 Some business interviewees maintained that, for corporate engagementin humanitarian relief to be sustainable over time, high-level buy-in isabsolutely crucial. Interview with a representative of a corporationconducted by the authors, June 2006.
26 Interview with a representative of an academic institute conducted bythe authors in June 2006.27 Interview with an NGO representative conducted in June 2006.
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‘old-style’ philanthropy, or to dismiss it as unsustainable. Ourinterviews suggest, however, that in many cases thephilanthropic motives of individual corporate leaders play acentral role. We currently lack a solid understanding of whatmotivates such leadership, how it plays out within thecompany (i.e. how corporate initiatives that are driven byindividual executives are managed), and what happens onceleading corporate executives disappear from the scene. Theresearch focus on identifying the business case is useful;however, we should not lose sight of the important role ofphilanthropy and individual leadership.
CSR as a (clever) way in to new markets?
It has been suggested that non-commercial engagement inhumanitarian relief may simply be a shrewd tactic to enter newmarkets or to get access to new clients. Offering certain goodsand services for free may open a lot of new doors. Forexample, TNT’s record in its partnership ‘Moving the World’ issaid to have convinced the Dutch government to look to thecompany to provide commercial services in health carelogistics. In the same vein, the non-commercial engagement ofthe consulting firms Booz Allen Hamilton30 and McKinsey &Company31 may have been the first steps in these firmssecuring profitable business opportunities later.
In other cases, such as donating technology, contributinggoods to traditional humanitarian actors may simply hook thereceiver into using a specific proprietary technology in whichthey will later have to invest further, thus benefiting thebusiness. This was a key sticking point in the negotiationsbetween Ericsson and the UN in the context of Ericsson’s Firston the Ground Initiative. The UN, while grateful for the supportthe company offered to its emergency response work, wasconcerned that adopting Ericsson technology would commit itto long-term servicing contracts.
Our research suggests that there is no conclusive evidencethat the non-commercial engagement of companies inhumanitarian relief is a systematic part of a broader strategyto win new business.
3.2.4 Impact on the humanitarian sector
At this early stage, the impact of corporate partnerships andCSR initiatives on traditional humanitarian actors is difficult to
assess. Overall, access to comparable and reliable data is verylimited. Nonetheless, potential impact is possible in four areas.
Competition with NGOs?
The increasing engagement of business – even if it occurs ona non-commercial business model – raises the questionwhether traditional humanitarian actors, in particular NGOs,will be crowded out. Our research suggests that there appearsto be little or no ‘crowding out’ effect. Our interviews and casestudies show that engagement is often intended to becomplementary (as in the case of logistics companies). In fact,the emergence of meta-initiatives could link traditionalhumanitarian actors such as NGOs to businesses that not onlyprovide much-needed funding, but also offer worldwidecontacts, logistical expertise or other relevant business skillsand resources. In other words, business usually providesgoods and services on a non-commercial basis that NGOs orgovernmental agencies do not have at their disposal.
Are voluntary contributions displacing donor funding?
A question repeatedly raised by observers concerns thelikelihood that increased voluntary corporate engagement willmake donors less willing to provide funds (GPPi interviews,2006). If companies provide certain services – logistics,telecommunications – free of charge, then presumably donorscan reduce their contributions to humanitarian relief operations.This scenario is particularly worrying since the sustainability ofvoluntary corporate engagement is not clear and, as explainedabove, may be volatile. However, none of the intervieweescontacted for this study believed that governments had reducedtheir contributions to humanitarian relief operations because ofvoluntary company contributions in recent years. One reasonmay be the limited financial significance of the initiatives inquestion. If engagement were to increase significantly, apotential crowding out effect may become more likely.
What is the impact on coordination in the humanitarian
sector?
A more general consequence of increasing corporateengagement in humanitarian relief concerns coordination.Large-scale disasters such as the tsunami have shown thatcoordination is already a significant challenge, and there arefears that these problems will only increase with the entry ofnew, business actors into the humanitarian realm. Manycompany representatives interviewed for this study are keenlyaware of the general challenge coordination poses, and find itdifficult to navigate the complex institutional environment: ‘Ifind it difficult to determine who does what and why. It seemsto me that institutions should become engaged based on theircomparative institutional advantages. What would beimportant in my view is that there is better coordination – andless competition – so that we can really make a difference’(GPPi, 2006). The creation of meta-initiatives reflects thedesire of companies to address these challenges. Thus far,there is no hard evidence pointing to increasing coordinationchallenges as a result of growing corporate engagement in
30 In June 2005 Booz Allen Hamilton, in cooperation with the US Chamberof Commerce Center for Corporate Citizenship, brought together 70government, business and non-profit leaders to work on a Global DisasterRelief simulation as an exercise in public-private-nonprofit coordination.For more information, see the Booz Allen Hamilton website:www.boozallen.com/publications/article/884235?lpid=661123.31 McKinsey is consulting NGOs from the sector and has been publishing forseveral years on issues such as the problem of coordination in humanitarianaction. In the context of the tsunami, the company consulted theRehabilitation and Reconstruction Agency for Aceh and Nias (BBR) of theIndonesian government and the Taskforce to Rebuild the Nation (Tafren) of theSri Lankan government on how to deal with the huge inflow of donated money.This engagement was pro bono, but interviewees claim that, in the long run,such an engagement of McKinsey consultants must generate revenues, and isin competition with agencies such as UNDP (see McMahon, 2006).
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relief. The number of companies which currently engagedirectly in management and implementation is – at least whencompared to the number of NGOs active in that domain –comparatively small.
However, several interviewees highlighted the difficulty ofactually turning private sector intent into effective assistance,especially in the immediate aftermath of large-scale disasters.After the tsunami, institutions like OCHA were flooded withoffers of help from the business community, most of it in-kind. Itproved impossible for OCHA and others to effectively leveragethat help because offers were unsuitable, or the necessarymechanisms and protocols were not in place to implement theoffers. As a result, many post-tsunami evaluation reports detailthe logistical difficulties that ensued when numerousunanticipated shipments of relief supplies (sometimesirrelevant to the task at hand) arrived at local airports andseaports, flooding the limited storage space available (for adetailed evaluation of the international response to the IndianOcean tsunami, see Telford and Cosgrave, 2006). Despite hugeefforts by companies such as DHL and TNT to handle logistics,bottlenecks at crucial arrival points occurred regularly. Itbecame evident that greater linkage and coherence was neededbetween international humanitarian actors, corporate entitiesand local governments (ibid.).
Attempts were made to document corporate donations. Forexample, the UNDP Regional Centre in Bangkok created aprivate sector development assistance database (PS DAD) todocument private sector contributions to post-tsunami relief,improve accountability and transparency and match supplywith demand (see http://tsunamitracking.org). The PS DADfaced numerous challenges. Nonetheless, the final reportshows that the pilot has been a valuable template for trackingprivate sector contributions specifically, and donorcoordination more generally (UNDP, 2006).
What is the impact on humanitarian principles?
Finally, the increasing non-commercial engagement ofcompanies in humanitarian relief also raises questions aboutthe application of humanitarian principles. Again, given therelative novelty of the phenomenon, it is too early for acomprehensive assessment.
Our interviews with business representatives suggest thatcompany practitioners are generally well aware of the keychallenges they must confront in their engagement inhumanitarian relief. However, only a very few intervieweeswere actually aware of humanitarian principles, or the debatesaround them in the humanitarian sector.
The principle of impartiality calls for non-discriminatory andproportional humanitarian action. Again, there is no empiricalevidence for discriminatory behaviour related to non-commercial business engagement in disaster relief. However,business engagement in general tends to discriminate in
favour of natural disasters. Additionally, single-companyinitiatives tend to help their own staff or the community theyare operating in. Those not profiting from this engagementmight feel disadvantaged. Moreover, the fact that the rise ofbusiness engagement has been mainly linked to the IndianOcean tsunami begs the question of proportionality. Ifbusiness engagement is indeed motivated by brandingconcerns, proportionality might not be very high on thecorporate agenda. However, we found no evidence that help isprovided without considering need. Interviews suggest thatone reason for partnering with traditional actors is their betterneeds-assessment capacity (GPPi interview, 2006).
What about independence and neutrality? Only autonomoushumanitarian action renders principled action possible. Theactivities of single companies and meta-initiatives may nothave much influence on traditional actors’ independence. Inpartnerships, however, the corporate partner might want tohave a say in how and where its funds will be used. Eventhough there is no evidence from the case studies andinterviews, independent humanitarian action in partnershipscannot be taken for granted.
It is often claimed that only neutral humanitarian action enjoysthe confidence of all. A priori, private sector actors engaged inhumanitarian relief have no systematic interest in taking sides.On the contrary, the risk of being associated with a certain partyor group is one of the reasons why corporate actors tend to shyaway from engagement in post-conflict settings. Nonetheless,private sector actors might not be perceived as neutral on theground. Their neutrality depends on their pre-disaster reputationin the affected community, as well as their ongoing behaviourand communication strategies during crises. Especially inpartnerships, this reputation can affect the humanitarianpartner. and may undermine or strengthen its credibility.
In sum, empirical evidence from the interviews and casestudies does not suggest any systematic tension betweennon-commercial business engagement and fundamentalhumanitarian principles. This relates to the business desire forpositive branding: positive branding requires principledaction. This is not to say that, depending on the form of theengagement and the individual case, tensions betweenbusiness engagement and humanitarian principles might notarise. However, the more important problem lies in a lack ofawareness and guidelines.32
Training on specific humanitarian principles as advanced byhumanitarian NGOs or the UN is rare. However, there has beena movement towards the development of universal guidelineson humanitarian assistance. For example, in January 2006 theWorld Economic Forum launched the Humanitarian Relief
32 Business Roundtable and the International Business Leader Forum(IBLF) have started to address this: www.businessroundtable.org/taskForces/taskforce/doclist.aspx?qs=44F5BF159FA5D14488A12D239EA5Band http://www.iblf.org/docs/EBTsunami.pdf.
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Initiative (HRI), which has three mains aims, one of which is the‘development of a set of cross-sector and sector-specificguidelines and standards regarding private sector participationin humanitarian relief facilitated by the United Nations’.33 Whilesuch a structured dialogue between companies and traditionalhumanitarian actors on humanitarian principles is still arelatively new phenomenon, the increasing incidence of meta-initiatives as well as professional development courses34
presents an opportunity to inform companies about theprinciples of traditional humanitarian actors, and to facilitatetheir implementation.
3.3 Outlook
What can reasonably be said about the likely future develop-ment of the phenomenon of non-commercial business engage-ment? How likely is it that existing initiatives will be continued, orthat individual initiatives will grow? How will the nature of non-commercial business engagement evolve in coming years?
Our analysis of existing initiatives and motives drivingbusiness engagement suggests that we should not expectfurther substantial growth. The incidence of large-scalecrises (e.g. huge natural disasters along the lines of the2004 tsunami) may result in another period of stronggrowth. However, without such cataclysmic events it seemsunlikely that a large number of additional corporations willengage in humanitarian relief on a non-commercial basis.While individual companies may have found a business casefor their engagement, direct financial benefits from this typeof work are difficult if not impossible to demonstrate.Without a clear and compelling business case, large-scalecorporate engagement on a non-commercial basis isunlikely. Furthermore, many corporate initiatives areconceptualised as flagship CSR programmes, which, asVogel (2005) argues, are usually designed to brand acompany as socially and environmentally friendly to set itapart from its competitors. The more companies – andespecially direct competitors – become engaged, the
smaller the likely branding and reputation gains companiesare able to reap from such work.
The scale of existing initiatives is not likely to growsubstantially. As shown above, the dominant motive behindcorporate involvement is the desire to build up brand equityand to invest in corporate reputation. It is likely that thesebenefits will not grow in line with increases in the size of theinitiative.
Perhaps more importantly, there is a clear preference for in-kindand core competency-related business programmes, asopposed to direct cash contributions. As indicated earlier,programmes based on in-kind contributions and the directengagement of company staff in humanitarian relief operationspromise greater direct benefits for corporations, includingbetter brand visibility and staff retention. ‘Perhaps the reallesson learned in recent years is the paradigm shift in corporateresponsibility from a strictly cash donation model to one thatincludes involvement and participation’ (Bob Bellhouse,Executive Director of the Disaster Resource Network, quoted athttp://www.iblf.org/ resources).
Among companies already active in the arena, there alsoappears to be a trend towards more strategic and long-termplanning, and a recognition of the need for consistent learning.This has resulted in at least two different developments. First,there have been attempts to facilitate coordination andlearning, including meta-initiatives and initiatives such asGlobal Hand, a web-based match-making service whichattempts to link corporate donors with traditional humanitarianactors, or IBM’s universal database.
Second, there is growth in planning for long-term engagementand stand-by capacity. Many companies have recognised that,to make a difference, long-term engagement is critical. Thetsunami experience demonstrated that, in order to respondquickly and effectively, it would be preferable to be able to relyon stand-by capacities, something which programmes such asthe DRN seek to facilitate. Pre-positioning supplies anddeveloping regional hubs from which to coordinate supplydeliveries will improve the coordination of aid delivery andhumanitarian response mechanisms.
33 See www.enewsbuilder.net/focalpoint/e_article000593396.cfm?x=b11,0,w. 34 Such as the Executive Education programme offered by INSEAD,targeted at company staff working in the humanitarian domain.
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Chapter 4A profitable market? Commercial business
engagement in humanitarian relief
For decades, non-profit actors have dominated humanitarianrelief – executing needs assessments, heading projectplanning and implementation and carrying out monitoring orevaluation activities. But humanitarian relief has also alwaysbeen a multi-billion-dollar market for companies. Businesseshave long been engaged in this market, providing servicesnot provided by not-for-profit actors and filling gaps wherethese traditional actors lack expertise – in the procurementand transportation of relief supplies such as machinery,electrical appliances or information technology products.WFP, for example, has long contracted logistic firms to moverelief goods from one place to another (GPPi interviews,2006).
Commercial business engagement in humanitarian relief isthus not a new phenomenon. More recently, however,humanitarian relief practitioners have reported thatcompanies are increasingly competing openly with traditionalhumanitarian agencies for contracts from bilateral andmultilateral donors to directly manage and implement reliefprojects (GPPi interviews, 2006). Besides the concern overpossibly losing funds, practitioners say that they are confusedby the current funding practices of key governmental donors –most notably USAID. In addition, they wonder whetherhumanitarian action based on commercial motivation ispossible at all, or a contradiction in terms.
Yet it is still unclear how significant the rise of commercialproviders in humanitarian relief is. This chapter thereforefocuses on the significance of commercial engagement, itsform and rationale, business motivation and the possibleimpact on the humanitarian sector and humanitarianprinciples. The analysis will look specifically at thosecommercial players believed to be competing with traditionalhumanitarian actors for humanitarian relief budgets byoffering similar goods and services.35
Our analysis is based on two sets of data: (1) governmentalbudget data from donors providing humanitarian funding tofor-profit companies – to determine to what extent, if at all,governments have started channelling money allocated inhumanitarian preparedness and relief budgets to companies;and (2) a scoping exercise, case examples of the respectivecompanies and several in-depth interviews with practitionersfrom both NGOs and corporations.
4.1 Donors and commercial business engagement in
humanitarian relief36
If companies are indeed attracting more funding from donors,we would expect to recognise this shift in public disaster reliefbudgets, with an increasing flow of governmental moneygoing to corporations, rather than to traditional humanitarianagencies. Working from this premise, the next section of thisstudy will analyse donor-funding regulations and, whereadequate data is available, relevant funding flows.
The focus is on flows from government donors, becausecompanies commercially active in humanitarian action oftendepend heavily on government contracts. USAID provides upto 90% of funding for some companies and, of course, manyNGOs get substantial funding from donors. Some companiesalso have contracts with traditional humanitarian actors, suchas the UN or NGOs. However, the analysis of financial flowsfrom them to companies would tell us nothing about concernsregarding competition, government funding practices andhumanitarian principles. Moreover, most funds come from ahandful of governments, in particular the United States, theUK, Sweden, ECHO, the Netherlands, Switzerland and Canada(OCHA – Financial Tracking Service, http://ocha.unog.ch/fts/index.aspx). It can reasonably be assumed that companies areunable to draw from the second largest source of funding,donations from private individuals, so, for the purposes of thisstudy, it is sufficient to analyse government funding forcommercial engagement in humanitarian action.
Most European donors provide emergency funding only fornot-for-profit organisations. France, Sweden, the Netherlands,Norway and Germany, as well as ECHO,37 do not channeldisaster relief funds through for-profit actors. These entitieshave established guidelines that prohibit government donorsfrom directly disbursing funds to commercial entities;government emergency money is exclusively expended onnon-profit organisations. Non-profits commonly subcontract
35 Interviewees from NGOs and IOs gave Crown Agents, Chemonics andothers as examples (April and May 2006). Note that we are not looking atthe big contracting agencies, such as Bechtel, Halliburton and KBR.
36 This study does not include commercial business engagement inreconstruction. There are two main reasons for this. First, the purpose ofthis paper is to look into new phenomena of non-commercial andcommercial business engagement in humanitarian relief, and assesswhether this phenomenon might add up to a significant trend. Corporatefor-profit engagement in reconstruction is not a new phenomenon. Second,the supposed growing importance and associated critique of businessengagement in reconstruction has been widely discussed – mainly in thecontext of the wars in Afghanistan and Iraq. This subject merits in-depthanalysis, which is beyond the scope of this paper.37 E-mail interview with EU representatives of ECHO, conducted by theauthors in June 2006 (see also http://ec.europa.eu/echo/whatsnew/calls_en.htm and http://ec.europa.eu/echo/partners/index_en.htm.
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the delivery of specific goods and services to commercialcompanies, but this is typically done only when they arethemselves unable to supply these goods or services.
The United States and the United Kingdom have more flexiblefunding regulations, and are the only governments amongthose studied which allow humanitarian aid to be channelledthrough commercial players. This is not a recent initiative bornof policy changes, but a well-established practice in bothcountries. A UK DFID procurement officer stated: ‘I do not recalla time when it was not allowed for for-profits to apply for aid. Itwas always whoever is in the best position to respond to aparticular disaster or conflict tended to receive the aid withoutdiscrimination regarding the status of the organisation’ (GPPiinterviews, 2007). There are some restrictions on the sourcesof funding for commercial players, but their overall marketsegment may still be significant, given that these countries arethe most important humanitarian aid donors.
Yet, to date, for-profits appear to attract only a small fraction ofUS and UK donors’ disaster relief budgets. UK government datadoes not show what percentage of the humanitarian reliefbudget is allocated to companies. Thirteen per cent of overallbilateral aid is spent on humanitarian assistance. Indicatedchannels for humanitarian assistance include the EuropeanCommunity, the World Bank Group, regional developmentbanks, the Commonwealth, the United Nations and bilateralentities,38 but no further distinctions are made for the lastgroup. Regarding total US commitments to humanitarian
preparedness and relief in the fiscal years from 1998 to 2006,the bulk of the money went to non-profit players (see Figure 2),whereas commercial actors receive only a negligible portion.Over the past eight years, there has been no significant changein the share captured by commercial actors.
It remains unclear why the US and the UK allow humanitarianassistance money to be channelled though for-profits, whiletheir European counterparts do not. Our interviews suggestthat this is probably a question of different cultures, as Anglo-Saxons in general seem less suspicious of business. NGOrepresentatives observed the same cultural ‘divide’ withrespect to NGOs, believing that American and British NGOs aremore open to partnerships with businesses than are Europeanones (GPPi interviews, 2006).
4.2 Results of scoping exercise
The scoping exercise includes commercial companies that fitthe following profile: (1) a for-profit organisation, (2) whosecore competence includes a direct link to humanitarian action,and (3) whose services (partially) overlap with servicesprovided by non-commercial actors.
Mainly assembled through internet research and expanded onin interviews, the scoping exercise identified 37 companieswhich offer goods and/or services in humanitarian action on acommercial basis. In accordance with our analysis of financialflows, most commercial providers of humanitarian action arelocated where the money is – in the United States and the UK.The majority of these companies rely almost exclusively on
20
HPG BACKGROUND PAPER
Figure 2: US commitments for disaster preparedness and relief (fiscal years 1998–2006)
38 Response to Freedom of Information enquiry, reference F2006-123.Document on file with the authors.
600
500
400
300
200
100
0
US
$ i
n m
illi
on
s
1998 1999 2000 2001 2002 2003 2004 2005 2006
Source: Diagram by the authors based on data from response to Freedom of Information enquiry reference, F2006-123
Total Profit
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 20
21
HPG BACKGROUND PAPER
funds from USAID or DFID. Many of the firms also holdcontracts with other US government agencies, notably with theState Department and Department of Defense. Most of the UK-based companies work with DFID and other UK governmentagencies. Many of the firms also act as consultants to host-country governments, mainly on economic and developmentpolicies (13); private sector firms (13); internationalorganisations such as the World Bank, OECD and UNDP (26);and INGOs, including Care International and MercyCorps (13).
Most companies did not disclose their annual revenues. Forthose that did, annual turnover from humanitarian relief rangedfrom approximately $20–50m per year.39 As the companieswere reluctant to share information regarding the source of theirfunding, and as they are mainly active in the blurred areabetween relief and development, it is difficult to determinewhether their income is coming from development or reliefbudgets. However, as most of these companies are more activein development than in humanitarian relief, it is reasonable toassume that they are mainly paid out of development budgets.
The majority of companies moved into humanitarian relief inthe 1990s. These companies are generally active in bothnatural disaster and post-conflict settings. A tiny majority ofthe firms moving into humanitarian relief activities do not havea developmental or related background. Our research suggeststhat some major economic consultancies, such as BearingPointand Booz Allen Hamilton, are orienting themselves towardshumanitarian action.40
Some of these companies are operationally active in the field.The majority, however, provide advice to government agencies indonor and recipient countries and to international organisationsand NGOs. Again, it is very difficult to track financial flows, but itseems that at least part of the money channelled through thesecompanies does eventually go to traditional humanitarianagencies, implementing projects on the ground.
Thus, there is more often a cooperative relationship than acompetitive relationship between non-profit and commercialactors. However, it is important to note that these tworelationships are not mutually exclusive. It is perfectly possiblethat commercial and non-commercial actors simultaneouslyhave a cooperative and a competitive relationship — a viewheld by some in the commercial sector, at least (GPPiinterviews, 2006).
4.3 Analysis and conclusions
Having described the profile of commercial actors in humani-tarian action through the scoping exercise, we will now analyse
their significance, the forms and nature of their engagement,their motivation and their impact on the humanitarian sectorand its principles. To address these and to control the results ofthe scoping exercise, we have conducted a small number ofcompany case studies (see Appendix III).
4.3.1 Significance of commercial business engagement in
humanitarian relief
The overall number of companies commercially active inhumanitarian action is very small, especially compared to thenumber of traditional actors in the field. Most of thesecommercial actors still have a focus on social and economicdevelopment; only a handful of them, such as Chemonics,Management System International and PADCO, have expandedinto the field of humanitarian relief since the late 1990s. Itappears that, while these commercial players may provide thesame services as traditional humanitarian actors, they focus onlong-term projects and thus tend to arrive later on the scene, andengage more in social transformation than in immediate relief.41
However, given that business responds to market signals andincentives, it may be assumed that companies will try to enterthe market more aggressively in coming years. Althoughhumanitarian funds still account for only a fraction ofdevelopment funds, they are growing at a higher rate(Development Initiatives, 2006). However, based on theanalysis conducted in chapter 2, such growth is unlikely.
4.3.2 Forms and nature of commercial business engagement
First, the most important clients of these companies aretypically US and UK government agencies, mainly USAID andDFID. Only a small number of commercial actors actuallyimplement projects. Many operate instead as consultants togovernments and other organisations, and subcontract thedelivery of help to (local) NGOs.
Second, companies engaged in humanitarian relief are generallysmaller in size and income than the major traditional actors.42
Others are subsidiaries of big construction firms, or have a corebusiness unrelated to humanitarian action, both of which makeintra-company cross-financing of humanitarian action possible.The fact that the commercial players active in humanitarianaction are either cross-financed or are small businessessuggests that, despite its growth, the humanitarian market isdifficult for development consultancies to enter and thrive in(see chapter 2).
The case studies conducted for this report further reveal thatthere is an apparent similarity between development
39 This equals a tenth of the income of SCF UK in 2005 on the lower end,and a tenth of the income of Care International in 2005 on the upper end ofthe scale.40 The consulting firm McKinsey & Company is also moving intohumanitarian action. However, this engagement has been purely on a pro
bono basis.
41 Interviews with representatives from these companies did not revealwhether the money for this engagement is coming from publichumanitarian or developmental budgets or private budgets from theirparent company.42 Requirements to become a certified 8(a) firm are to be a small business,to be unconditionally owned and controlled by one or more socially andeconomically disadvantaged individuals and to demonstrate the potentialfor success. Certified 8(a) firms have easier access to governmentcontracts.
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 21
consultancies and NGOs in respect to self-presentation.Several NGO representatives reported that it is difficult forbeneficiaries to distinguish between for-profit and not-for-profit organis-ations providing relief (GPPi interviews, 2006).Both commercial and non-profit actors have similarmarketing strategies and draw on the same public donors.One substantial difference, though, is that commercial actorsdo not have access to financial contributions from privateindividuals.
4.3.3 Business motivation
Information on the key motivations behind companiesentering the market for humanitarian relief remains scarce.Interviewees often did not understand the purpose of ourinquiries regarding their motivation for entering the marketwith a commercial approach. If at all, they answered by listingtheir strengths vis-à-vis the non-profits, or emphasised that akey rationale was to ‘help people in need’. However, as thesecompanies are for-profit, it can be assumed that financialinterest is a key inspiration for their engagement.
4.3.4 Impact on the humanitarian sector
Competition with NGOs?
The activities of commercial players in humanitarian relief areboth competitive and complementary to those of traditionalactors. Interviewees from non-profit organisations oftenemphasised the competitive nature of their relationship,whereas commercial actors tended to highlight comple-mentary aspects. While commercial players provide similarservices to non-profits, in most cases they do not enter thescene until traditional actors have already establishedthemselves on-site. This suggests that the more specific andimmediate tasks in providing relief, as opposed toreconstruction and long-term development, remain largely thedomain of the traditional (non-profit) players. Intervieweesfrom governments, business networks, NGOs and the ICRC allidentified needs assessment as a core service provided by theUN or NGOs, with longer-term services falling under thecompetency of other actors (GPPi interviews, 2006).Companies tend to be active in long-term rather than short-term projects, they act as consultants to bilateral andmultilateral organisations rather than working directly withbeneficiaries on the ground, and they both subcontracthumanitarian organisations and are subcontracted by them.So far, there is no evidence supporting the belief that there isincreasing competition between commercial and non-profitactors for humanitarian budgets.
Transparency
One frequently voiced concern regarding company engagementrelates to apparently non-transparent government fundingpractices in humanitarian relief. This concern relates mainly tothe US government and the crises in Afghanistan and Iraq. Itwas indeed difficult to gather information on funding flows.However, this was mainly due to the reluctance of commercialactors to provide information on their income.
What is the impact on humanitarian principles?
Commercial actors do not explicitly mention the fundamentalhumanitarian principles of humanity, impartiality, independenceand neutrality as guiding principles. However, most of theemployees in companies that engage in humanitarian relief thatwere interviewed for this study appear to be well aware of theseprinciples. Many had a developmental or humanitarianbackground before joining commercial companies. The explicitlystated principles guiding the work of these firms are customer-oriented and do not exclusively consider the interests ofbeneficiaries. This relates to the fact that these companiesprovide their services to bilateral or multilateral organisations orhost governments, rather than directly to beneficiaries.
There might be a tension between a commercial businessrationale and the principle of humanity, i.e. providing helpsolely based on need. As most companies rely heavily ongovernment funding, they provide help where their clients wantthem to do so. The same argument holds for some major US-based NGOs, which also predominantly rely on governmentfunding, such as Care International. Others, for example MSFFrance or World Vision, dispose primarily of private voluntarydonations. This enables them to respond to neglected crises(see Development Initiatives, 2006: 41).
With respect to impartiality, there is no evidence that commercialactors discriminate against certain beneficiaries, nor is there anytheoretical reason why they should do so. However, as with theirnon-commercial business counterparts, proportionality will notnecessarily be high on the agenda. Yet companies that enter thehumanitarian domain to make a profit are under less pressure toperform well. Businesses engaged on a non-commercial basisare subject to the scrutiny of several stakeholder groups: theirhumanitarian partners, the community they are working in, theirinvestors and their consumers (as their engagement is directedtowards them). Commercially engaged businesses, however, areonly accountable to their contractors. Hence, their engagementis less visible to other stakeholders, and is therefore under lesspressure to perform.
The independence to act according to humanitarian principlesis thus not necessarily a given. This, again, relates not tocompanies being commercially motivated, but to them beingdependent on government funding. They share this problemwith equally dependent non-profit actors. However, as ouranalysis in chapter 2 has shown, commercial actors are lessable to attract the individual private funds that enable them toact independently.
Finally, we could find no evidence establishing any systematicpositive or negative relationship between commercialbusiness engagement in humanitarian relief and the principleof neutrality. It might therefore be assumed that, as with otheractors in humanitarian relief, the neutrality of commercialactors depends on the behaviour of the individualorganisation.
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Efficiency
Representatives from commercial as well as non-profitorganisations are generally open to the argument thatcompetition has the potential to increase the efficiency ofhumanitarian relief. Commercial actors often claim that theyprovide cheaper and more efficient services than their non-profit counterparts. However, here too no reliable data isavailable to assess the issues at hand. The greatereffectiveness of commercial actors can neither be proved norrejected.
4.4 Outlook
In sum, we should expect commercial engagement inhumanitarianism to rise and fall according to the opportunitiesin the market. However, certain structural characteristics of themarket, as discussed in chapter 2, will probably always limit
any such engagement. Furthermore, although commercialactors might be better able to present themselves as efficientand professional – a valuable selling point at times whendonors demand more professionalisation – this will probablybe convincing only in the short term. Our analysis in chapter 2has shown that inefficiencies in humanitarianism partly stemfrom market imperfections, such as information asymmetryand particular incentive structures – something that for-profitand non-profit actors alike confront.
It seems unlikely that commercial actors will challenge thedominance of traditional non-profit actors in the field ofhumanitarian action. So far, commercial activity inhumanitarian relief is a niche phenomenon. Taken together,corporate for-profit engagement in humanitarian action doesnot seem to have the potential to substantially transformhumanitarianism as we know it today.
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Chapter 5Conclusions and policy recommendations
Over the past decade, the humanitarian domain has undergonea significant transformation. In many ways, it would seem thatthese developments have prepared the ground for more directand extensive business engagement in humanitarian relief:commercial actors should naturally be attracted by theconsiderable financial size of the market; private firms possessthe business management expertise and tools governmentsincreasingly demand (Thomas/Fritz, 2006); and donors may alsoconsider companies to be more responsive to their demands.
And yet, our review of business engagement in humanitarianrelief, both on a non-commercial and a commercial level,reveals that business engagement in humanitarian relief is notsignificant, either with regard to the number of companiesinvolved or the financial size of the contracts they manage. Thisdoes not imply that business engagement in humanitarianrelief should be considered irrelevant. While still a nichephenomenon, the changing nature of business engagement inhumanitarian relief is interesting and important, and gives riseto a number of challenges and policy recommendations fortraditional humanitarian agencies, donors and businesses.
5.1 Policy recommendations: non-commercial business
engagement in humanitarian relief
It is important for traditional humanitarian agencies – especiallythe large humanitarian relief NGOs and multilateral reliefagencies (i.e. the UN) – to position themselves so as tomaximise the potential benefits to be gained from collaboratingwith companies in humanitarian relief while, at the same time,minimising the risks. This requires an accurate assessment ofthe new opportunities such business engagement opens up.
5.1.1 Fundraising and giving
In the past, expectations among international agencies(particularly the UN) about the willingness of business tocontribute financially to their work may have been toooptimistic. In the UN, for example, partnership with businesshas become a synonym for fundraising (Witte and Reinicke,2005). Our inquiries into partnerships in humanitarian actionhave shown that business prefers to contribute in-kind ratherthan in cash. Hence, except during times of exceptional crises(such as the tsunami), the private sector has not become amajor source of cash for NGOs or the UN. Partnership-buildingshould not, therefore, be considered a fundraising strategy;instead, it should be seen as a means to strategically acquirecertain products or skills.43
A realistic assessment of the willingness of companies tocontribute to humanitarian relief missions must be matchedwith an appropriate assessment of the ability of traditionalhumanitarian agencies to absorb such contributions, most ofwhich are in-kind. Partly due to the novelty of businessengagement in humanitarian relief, the ‘interface capacity’ ofmany traditional humanitarian agencies with business is stillunder-developed. Businesses that are interested in givingshould make use of existing coordination mechanisms, such asthe Consolidated Appeal Process (CAP), the Central EmergencyRelief Fund (CERF) and coordinating NGOs such as Global Handor the World Economic Forum’s Humanitarian Relief Initiative.They should also be aware that cash contributions are mostvaluable when they can be used flexibly.
It is important that donors do not draw the wrong conclusionsabout the increasing non-commercial engagement of businessin humanitarian relief. Voluntary business engagement canonly be complementary to existing initiatives, not a substitutefor them, as it will always vary in relation to economic cycles.The sustainability of corporate engagement, especially in badeconomic times, is an important question, and one that hasyet to be answered. Thus far, governments have not used non-commercial business engagement as a pretext for reducingtheir financial commitments to humanitarian relief – and theyare well advised to maintain such a strategy.
5.1.2 Developing common rules/humanitarian principles
Collaboration with the private sector – irrespective of its form –can only be effective if it is based on common rules andprinciples. One of the hurdles to effective collaboration is a lackof understanding of corporate culture and, perhaps moresignificantly, the lack of effective protocols and procedureslinking corporate partners into work on the ground. Obviously,a prerequisite for the development of effective protocols andprocedures is a mutually understandable language. The workdone by the WEF and OCHA in this regard is a step in the rightdirection.44
Business should continue to invest in educating staff theydeploy in humanitarian relief partnership missions, inparticular on existing humanitarian principles. Companiescould pool training capabilities through initiatives such as theDisaster Resource Network or via the Fritz Institute.
Traditional actors, on the other hand, should not compromiseprinciples for the sake of partnership-building. To preventpossible tensions between corporate behaviour and humani-43 A good example of such strategically important products and skills is the
HELIOS software – a supply chain technology. The Fritz Institute provideshumanitarian agencies with a royalty-free licence to use HELIOS fordisaster relief and other emergencies. See http://www.fritzinstitute.org/prgTech-HELIOS_Overview.htm.
44 See for example the ‘Guiding Principles for Philanthropic Private SectorEngagement in Humanitarian Action Draft for Discussion (27 January 2007)’jointly published by OCHA and the World Economic Forum(http://ochaonline2.un.org/Default.aspx?tabid=1673.
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tarian principles, they should engage in raising awareness andshould carefully select their corporate counterparts.
5.1.3 Building partnerships
As our analysis has shown, non-commercial businessengagement will probably remain a niche phenomenon inhumanitarian action. Nonetheless, business engagement inrelief operations has attracted significant attention, and hasgiven rise to frequently controversial debate among NGOs andwithin the UN about the value of building partnerships withcompanies. Our research indicates that partnerships can helpto fill gaps in humanitarian action. But they require time andresources to develop and maintain. Traditional humanitarianactors and businesses should be aware of the limits ofpartnerships – they are by no means a panacea. For example,cooperation with private sector actors in humanitarian actionwill probably remain limited to natural disaster settings.Similarly, companies should not try to emulate what traditionalhumanitarian agencies have been doing for decades, butshould aim instead to supplement these efforts with theirparticular corporate strengths. The case studies suggest thatbusiness engagement in humanitarian relief is most effectiveand sustainable when it builds on the core competences of thecompany.
The most effective partnerships are those that develop stand-by capacity. During or immediately following disasters,partners do not have the time for strategic reviews and thenecessary evaluations to examine whether cooperation makessense in terms of actual outcomes, outputs and impacts.
Finally, as with traditional humanitarian agencies, companiesneed to familiarise themselves with their partners’ culture.Efficiency in the humanitarian realm cannot be measured onlyin terms of the quality and speed of the services delivered, butmust also encompass inclusiveness, empathy with the victimsand compliance with humanitarian principles.
5.1.4 Partner selection
As our analysis has demonstrated, partner selection hasfrequently proved difficult. Companies tend to favour large,established partners with a proven track record. However,selecting a smaller partner organisation might be anadvantage when it comes to flexibility. Compared to the bigplayers, smaller humanitarian organisations may be capableof setting up a partnership faster, because they have lowerlevels of bureaucratisation. Meta-initiatives may be valuablefor identifying reliable partners in the humanitarian reliefdomain, irrespective of size and standing. Careful partnerselection is important with respect to the company’sreputation on the ground. To be perceived as neutral, only abusiness partner that is not associated with any party orprevious misbehaviour should be selected.
5.1.5 Making a difference
Companies should try not to limit their operations to high-profile
or highly-visible regions. While being active in high-profileemergencies may lead more quickly to positive media coverageand greater recognition of the activity, a sustainable positivebrand image is based on credibility. Thus, in the long term,company engagement will only pay off if businesses prove areliable partner, responsive to humanitarian need as well asmedia attention.
5.2 Policy recommendations: commercial business
engagement in humanitarian relief
Our analysis in chapter 4 leads us to conclude that commercialplayers are not significant competitors for money andattention in humanitarian relief. Given the structure of thehumanitarian market, it appears unlikely that this situationwill change in any fundamental way in the coming years.
Companies that have started engaging in the humanitarian reliefarena must become more transparent. In our research, weencountered difficulties in gathering information on the activitiesof these firms. To establish themselves as accepted players inthe humanitarian domain, companies will need to make a morecoordinated effort to inform the public about their work.Government donors have to press for humanitarian relief that ismost beneficial to those in need, irrespective of the legal statusof the organisation providing it. Through systematic evaluations,government donors should determine where commercialproviders – as they claim to do – can indeed generate more valuefor money without undermining humanitarian principles.
5.3 Conclusions
The role of business in humanitarian relief is becoming moreprominent, but it remains a niche phenomenon. At the sametime, it is also clear that much more research is required inorder to solidify the preliminary findings of this study. Twoareas in particular require more attention, from researchersand practitioners alike:
• Possible ways to evaluate outcomes and impacts ofpartnerships. So far, very few partnerships in the humani-tarian relief domain have been evaluated. To some extentthis is a consequence of a lack of will. But evaluationpractitioners also point to methodological difficulties. Whilestandard project and programme evaluation tools andtechniques have improved significantly over the past fewyears, no effective partnership evaluation frameworks havebeen developed. Such frameworks should help to determinewhether individual relief projects have been effective andefficient. In addition, they should assist in determining thespecific added value of the partnership approach.
• An assessment of the extent to which business engagementimpacts on accountability and transparency in the humani-tarian sector. Accountability and transparency are increas-ingly becoming leading tenets of humanitarian action. Thedifficulty of acquiring information from many business actors
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with respect to financial flows heightens concerns about thetransparency and accountability of corporations. However, sofar, there have been no systematic investigations into howbusiness engagement – whether on a commercial or a non-commercial basis – impacts on these principles.45
Research on business engagement in humanitarian relief is inits infancy. Most significantly, research efforts in this fieldsuffer from a lack of reliable data. This data gap needs to befilled. All those engaged in the humanitarian domain – NGOs,governments and businesses – should contribute to this effort.
45 The Global Accountability Report Index covers the world’s 30 mostpowerful organisations – including transnational corporations. Seewww.oneworldtrust.org.
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tern
atio
nal
Dis
aste
r Lo
gist
ics
Fede
rati
on o
f pr
epar
edne
ss
Red
Cros
s/Re
d
Cres
cent
Ast
raZ
en
eca
N/A
2005
Part
ners
hip
Bus
ines
s-N
GO
Phar
ma
USD
300
kRo
tary
Clu
b of
N
atur
al d
isas
ter
Infr
astr
uctu
re
Aus
tral
ia
BA
SF
BA
SF K
atas
tro
2004
Part
ners
hip
Bus
ines
s-U
NCh
emis
try
N/A
UN
-Hab
itat
Nat
ural
dis
aste
rIn
fras
truc
ure
phen
hilfe
e.V
.(b
uild
ings
)
Blo
om
be
rgN
/AN
/APa
rtne
rshi
pB
usin
ess-
NG
OFi
nanc
eN
/AIn
tern
atio
nal
N/A
N/A
Resc
ue
Com
mit
tee
Bo
sto
n C
on
sult
ing
N
/A20
03Pa
rtne
rshi
pB
usin
ess-
UN
Cons
ulti
ngN
/AW
FPN
atur
al d
isas
ter
Fund
rais
ing/
Gro
up
Cons
ulti
ng
BP
N/A
2004
Part
ners
hip
Bus
ines
s-G
over
nmen
tEn
ergy
USD
250
kG
over
nmen
t N
atur
al d
isas
ter
Educ
atio
n
agen
cies
BP
N/A
2004
Part
ners
hip
Uni
late
ral/
En
ergy
USD
7m
Som
e so
rt g
iven
N
atur
al d
isas
ter
Imm
edia
te a
id
Bus
ines
s-ge
nera
lto
Inte
rnat
iona
l
Red
Cros
s
Re
su
lts
of
sco
pin
g e
xe
rcis
e o
f n
on
-co
mm
erc
ial
bu
sin
es
s e
ng
ag
em
en
t in
hu
ma
nit
ari
an
re
lie
f
(co
nti
nu
ed
)
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 29
30
HPG BACKGROUND PAPER
Co
rpo
rate
pa
rtic
ipa
nts
Na
me
of
init
iati
veFo
un
din
gT
yp
e o
f in
itia
tive
Su
b-t
yp
e o
f in
itia
tive
Ind
us
try
se
cto
rsB
ud
ge
tP
art
ne
rsD
isa
ste
r co
nte
xt
Co
ntr
ibu
tio
ny
ea
r
Bra
nd
ix L
an
ka
N/A
2006
Part
ners
hip
Bus
ines
s-U
NA
ppar
elU
SD 1
3kU
ND
PN
atur
al d
isas
ter
Infr
astr
uctu
re (
wat
er)
Bri
sto
l-M
eye
rs S
qu
ibb
N/A
2004
Part
ners
hip
Bus
ines
s-N
GO
Phar
mac
euti
cals
USD
7m
Vari
ous
aid
Nat
ural
dis
aste
rM
edic
ine
grou
ps a
nd N
GO
s
Bro
etj
e O
rch
ard
sN
/AN
/APa
rtne
rshi
pB
usin
ess-
NG
OFo
odN
/AIn
tern
atio
nal
N/A
N/A
Resc
ue
Com
mit
tee
Bru
nsw
ick
Co
rpo
rati
on
N/A
2006
Part
ners
hip
Bus
ines
s-U
NB
oats
USD
330
kU
ND
PN
atur
al d
isas
ter
Tran
spor
tati
on (
boat
s)
Bu
sin
ess
Ro
un
dta
ble
Part
ners
hip
for
2005
Part
ners
hip
Bus
ines
s-N
GO
Wid
e ra
nge
of d
isas
ter
N/A
Vari
ous
Nat
ural
dis
aste
rsD
isas
ter
relie
f
Dis
aste
r Re
spon
sere
spon
se a
nd r
ecov
ery
prof
essi
onal
proj
ects
disa
ster
rel
ief
orga
nisa
tion
s
Ca
pit
al
Gro
up
N/A
N/A
Part
ners
hip
Bus
ines
s-N
GO
Fina
nce
N/A
Inte
rnat
iona
lN
/AN
/A
Resc
ue C
omm
ittee
Cit
igro
up
N/A
2004
Part
ners
hip
Bus
ines
s-U
NFi
nanc
eN
/AO
CHA
Nat
ural
dis
aste
rIn
fras
truc
ture
(tra
nspo
rt/
com
mun
icat
ion)
Co
ca-C
ola
The
Glo
bal W
ater
20
05Pa
rtne
rshi
pB
usin
ess-
UN
-NG
OB
ever
ages
USD
2.2
m (
init
ial)
Uni
ted
Nat
ions
N
atur
al d
isas
ter
Infr
astr
ucur
e
Chal
leng
eFo
unda
tion
, UN
DP,
(w
ater
)
UN
ICEF
De
loit
te T
ou
che
N/A
2005
Part
ners
hip
Bus
ines
s-U
NCo
nsul
ting
N
/AU
ND
PN
atur
al d
isas
ter
Aid
Fac
ilita
tion
Toh
ma
tsu
(14,
000
hour
s)
(Tra
nspa
renc
y)
De
uts
che
Po
stN
/A20
04Pa
rtne
rshi
pB
usin
ess-
Bus
ines
sLo
gist
ics
USD
2.8
meB
ay, E
in H
erz
für
Nat
ural
dis
aste
rLo
gist
ics
Wo
rld
Ne
tKi
nder
(N
GO
)
De
uts
che
Po
st
N/A
2004
Part
ners
hip
Bus
ines
s-U
NLo
gist
ics
N/A
OCH
AN
atur
al d
isas
ter
Logi
stic
s
Wo
rld
Ne
t(t
rans
port
-air
) fo
r
disa
ster
res
pons
e
De
uts
che
Po
stN
/A20
04Pa
rtne
rshi
pB
usin
ess-
UN
Logi
stic
sN
/AU
ND
PN
atur
al d
isas
ter
Logi
stic
s fo
r di
sast
er
Wo
rld
Ne
tpr
epar
edne
ss
De
uts
che
Po
st W
orl
dN
/A20
04Pa
rtne
rshi
pB
usin
ess-
UN
Logi
stic
s, T
rans
port
N/A
UN
OCH
A, U
ND
PN
atur
al d
isas
ter
Logi
stic
s
Ne
t/D
HL
– D
HL
Dis
ast
er
Re
spo
nse
Te
am
s
Eri
csso
nEr
icss
on R
espo
nse
2000
Part
ners
hip
Bus
ines
s-U
NTe
leco
mm
unic
atio
nsN
/AU
N O
CHA
Conf
lict
and
natu
ral
Com
mun
icat
ion
Prog
ram
disa
ster
sse
rvic
es a
nd
awar
enes
s-ra
isin
g
Re
su
lts
of
sco
pin
g e
xe
rcis
e o
f n
on
-co
mm
erc
ial
bu
sin
es
s e
ng
ag
em
en
t in
hu
ma
nit
ari
an
re
lie
f
Ap
pe
nd
ix I
(co
nt)
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 30
31
HPG BACKGROUND PAPERE
rics
son
Eric
sson
Res
pons
e 20
06Pa
rtne
rshi
pB
usin
ess-
NG
OTe
leco
mm
unic
atio
nsN
/ATé
léco
ms
Sans
Co
nflic
tCo
mm
unic
atio
n
Prog
ram
Fron
tièr
esse
rvic
es
Eth
os
Wa
ter
N/A
2004
Part
ners
hip
busi
ness
-NG
OW
ater
N/A
Ope
rati
on U
SAN
atur
al d
isas
ter
Wat
er
Fed
Ex
Dis
aste
r G
ivin
g 19
95Pa
rtne
rshi
pB
usin
ess-
NG
OLo
gist
ics
>USD
1m p
er y
ear
Red
Cros
sN
atur
al d
isas
ter
Logi
stic
s
Prog
ram
cash
and
in-k
ind
serv
ices
Go
ldm
an
Sa
chs
N/A
N/A
Part
ners
hip
Bus
ines
s-N
GO
Cons
ulti
ngN
/AIn
tern
atio
nal R
escu
eN
/AN
/A
Com
mit
tee
IDT
N/A
N/A
Part
ners
hip
Bus
ines
s-N
GO
Tele
com
mun
icat
ions
N/A
Inte
rnat
iona
l Res
cue
N/A
N/A
Com
mit
tee
J.P.
Mo
rga
n C
ha
seN
/AN
/APa
rtne
rshi
pB
usin
ess-
NG
OFi
nanc
eN
/AIn
tern
atio
nal R
escu
eN
/AN
/A
Com
mit
tee
Joh
nso
n &
Jo
hn
son
N/A
N/A
Part
ners
hip
Bus
ines
s-N
GO
Hea
lth
Care
N/A
Inte
rnat
iona
l Res
cue
N/A
N/A
Com
mit
tee
KP
MG
N/A
N/A
Part
ners
hip
Bus
ines
s-N
GO
Cons
ulti
ngN
/AIn
tern
atio
nal R
escu
eN
/AN
/A
Com
mit
tee
Mic
roso
ftPr
ojec
t Pr
ofile
1999
Part
ners
hip
Bus
ines
s-U
NIT
N/A
UN
HCR
Refu
gees
Tech
nolo
gy
Mo
toro
la/M
oto
rola
N/A
2004
Part
ners
hip
Bus
ines
s-N
GO
Tele
com
mun
icat
ions
USD
1m
CA
RE
Inte
rnat
iona
lB
angl
ades
h Co
mm
unic
atio
n
Fou
nd
ati
on
(flo
odin
g), D
RC
serv
ices
(im
plem
ent
and
eval
uate
pro
ject
s,
secu
rity
), P
eru
(med
ical
car
e)
Ne
stlé
N/A
2004
Part
ners
hip
Bus
ines
s-U
NW
ater
N/A
UN
HCR
Refu
gees
– E
thio
pia
Infr
astr
uctu
re (
wat
er)
Nik
eTo
geth
er fo
r G
irls
2004
Part
ners
hip
Bus
ines
s-U
NA
ppar
ell
N/A
UN
HCR
Refu
gees
, Ken
yaSp
orti
ng A
ppar
el
No
rte
lN
/AN
/APa
rtne
rshi
pB
usin
ess-
NG
OTe
leco
mm
unic
atio
nsN
/AC
AR
E In
tern
atio
nal
N/A
(no
t ac
tive
yet
)Fu
ndra
isin
g
Pe
psi
Co
.N
/AN
/APa
rtne
rshi
pB
usin
ess-
NG
OB
ever
ages
N/A
Inte
rnat
iona
l Res
cue
Conf
lict
and
natu
ral
Prov
isio
n of
Com
mit
tee
disa
ster
sim
med
iate
aid
(w
ater
,
sani
tati
on)
Pe
psi
Co
N/A
N/A
Part
ners
hip
Bus
ines
s-N
GO
Bev
erag
esN
/AIn
tern
atio
nal R
escu
eN
atur
al d
isas
ter
N/A
Com
mit
tee
Pfi
zer
N/A
2004
Part
ners
hip
Bus
ines
s-U
NPh
arm
aceu
tica
lsN
/AU
NIC
EF, W
HO
Nat
ural
dis
aste
rLo
gist
ics
Pri
ceW
ate
rho
use
N/A
2004
Part
ners
hip
Bus
ines
s-U
N-N
GO
Acc
ount
ing/
Cons
ulti
ngN
/AU
nite
d N
atio
ns
Nat
ural
dis
aste
rTe
chno
logy
(tr
acki
ng)
Co
op
ers
Foun
dati
on, U
ND
P,
UN
OCH
A
Pri
ceW
ate
rho
use
N/A
2005
Part
ners
hip
Bus
ines
s-U
NFi
nanc
eN
/AU
NN
atur
al d
isas
ter
Aid
Fac
ilita
tion
Co
op
ers
(Tra
nspa
renc
y)
Pro
cte
r a
nd
Ga
mb
leN
/A20
05Pa
rtne
rshi
pB
usin
ess-
USA
IDCl
eani
ng p
rodu
cts/
U
SD 6
00k
USA
IDN
atur
al d
isas
ter
Imm
edia
te A
id (W
ater
)
cons
umer
goo
ds
(co
nti
nu
ed
)
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 31
32
HPG BACKGROUND PAPER
Co
rpo
rate
pa
rtic
ipa
nts
Na
me
of
init
iati
veFo
un
din
gT
yp
e o
f in
itia
tive
Su
b-t
yp
e o
f in
itia
tive
Ind
us
try
se
cto
rsB
ud
ge
tP
art
ne
rsD
isa
ste
r co
nte
xt
Co
ntr
ibu
tio
ny
ea
r
Ro
lls
Ro
yce
N/A
2004
Part
ners
hip
Bus
ines
s-U
NCa
rsN
/AU
ND
PN
atur
al d
isas
ter
Logi
stic
s/
Tech
nolo
gy
Ro
lls
Ro
yce
N/A
2006
Part
ners
hip
Bus
ines
s-G
over
nmen
tCa
rsU
SD 3
20k
Gov
ernm
ent
Nat
ural
dis
aste
rH
ealt
h
agen
cies
Ro
lls
Ro
yce
N/A
2006
Part
ners
hip
Bus
ines
s-G
over
nmen
tCa
rsU
SD 7
1kG
over
nmen
t N
atur
al d
isas
ter
Educ
atio
n
agen
cies
SA
S G
rou
pN
/A20
04Pa
rtne
rshi
pB
usin
ess-
gene
ral
Aer
onau
tics
N/A
Save
the
Chi
ldre
nN
atur
al d
isas
ter
Tran
spor
tati
on
(air
lifts
)
Tim
e W
arn
er
N/A
N/A
Part
ners
hip
Bus
ines
s-N
GO
Com
mun
icat
ions
/Med
iaN
/AIn
tern
atio
nal R
escu
eN
/AN
/A
Com
mit
tee
TNT
Mov
ing
the
Wor
ld20
02Pa
rtne
rshi
pB
usin
ess-
UN
Logi
stic
s, T
rans
port
USD
10m
(20
05)
WFP
Nat
ural
dis
aste
r/Lo
gist
ics
(Air
and
fam
ine
relie
fSu
pply
Cha
in)
UP
S F
ou
nd
ati
on
N/A
N/A
Part
ners
hip
Bus
ines
s-N
GO
Logi
stic
s, T
rans
port
N/A
Vari
ous
prof
essi
onal
Con
flict
and
nat
ural
Lo
gist
ics
disa
ster
rel
ief
disa
ster
s
orga
nisa
tion
s
Vo
da
fon
e G
rou
p
N/A
2004
Part
ners
hip
Bus
ines
s-N
GO
Tele
com
mun
icat
ions
USD
19m
(5
year
s)U
nite
d N
atio
ns
Nat
ural
dis
aste
rTe
chno
logy
(Ea
rly
Fou
nd
ati
on
Foun
dati
on, V
oxiv
aw
arni
ng)
Ast
raZ
en
eca
N/A
2004
Sing
le c
ompa
ny
Uni
late
ral/
Ph
arm
aceu
tica
lsU
SD 2
mN
/AN
atur
al D
isas
ter
Med
icin
e
enga
gem
ent
Bus
ines
s-ge
nera
l
IBM
IBM
Cri
sis
Resp
onse
2004
Sing
le c
ompa
ny
Uni
late
ral/
IT
USD
3.2
mVa
riou
s bu
t no
N
atur
al d
isas
ter
Tech
nolo
gy a
nd a
id
enga
gem
ent
Bus
ines
s-ge
nera
lco
nsis
tent
par
tner
faci
litat
ion
(com
mun
icat
ion)
Mic
roso
ftN
/A20
04Si
ngle
com
pany
U
nila
tera
l/
ITU
SD 4
00k
N/A
Nat
ural
dis
aste
rTe
chno
logy
ser
vice
s
enga
gem
ent
Bus
ines
s-ge
nera
l
Pfi
zer
N/A
2004
Sing
le c
ompa
ny
Uni
late
ral/
Ph
arm
aceu
tica
lsU
SD 5
0mN
/AN
atur
al d
isas
ter
Med
icin
e/
enga
gem
ent
Bus
ines
s-ge
nera
lin
fras
truc
ture
Re
su
lts
of
sco
pin
g e
xe
rcis
e o
f n
on
-co
mm
erc
ial
bu
sin
es
s e
ng
ag
em
en
t in
hu
ma
nit
ari
an
re
lie
f
Ap
pe
nd
ix I
(co
nt)
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 32
33
HPG BACKGROUND PAPERA
pp
en
dix
II
Re
su
lts
of
sco
pin
g e
xe
rcis
e o
f co
mm
erc
ial
bu
sin
es
s e
ng
ag
em
en
t in
hu
ma
nit
ari
an
re
lie
f
Co
mp
an
yW
ha
t th
ey
do
He
ad
qu
art
ers
Ma
in c
lie
nts
Es
tab
lis
hm
en
t/S
ett
ing
*R
ela
tio
ns
hip
M
oti
vati
on
fo
r s
ell
ing
Fe
ma
le-
ow
ne
dS
ize
**
An
nu
al
ex
iste
nce
in
w
ith
NG
Os
this
se
rvic
ere
ven
ue
hu
ma
nit
ari
an
fie
ld
Ag
ulh
as
De
ve
lop
me
nt
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omic
and
U
KD
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, EU
, hos
t N
/ACo
nflic
tPr
ofes
sion
alN
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rvic
es in
N
/A
Co
nsu
lta
nts
Ltd
.in
stit
utio
nal
gove
rnm
ents
,ov
er 4
5
deve
lopm
ent;
O
DI,
UN
coun
trie
s
polic
y m
akin
g
AIS
De
ve
lop
me
nt
Econ
omic
N
ew M
exic
o,
USA
ID19
60s
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lict
and
Pr
ofes
sion
alN
/AYe
sN
/AN
/A
deve
lopm
ent;
U
Sna
tura
l dis
aste
r
envi
ronm
enta
l
man
agem
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Am
eri
can
Ma
nu
fact
ure
rsPr
ocur
emen
t H
oust
on, U
SPr
ivat
e se
ctor
19
83; a
ppro
x.
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lict
and
Prof
essi
onal
and
N
/AYe
sSe
rvic
es in
N
/A
Exp
ort
Gro
up
serv
ices
;cl
ient
s, U
SAID
1996
hum
anit
aria
n
natu
ral d
isas
ter
com
peti
tive
over
90
tech
nica
lfie
ldco
untr
ies
assi
stan
ce
Ass
oci
ate
s in
Ru
ral
Econ
omic
B
urlin
gton
, US
Asi
an D
evel
opm
ent
1977
Co
nflic
t an
d Pr
ofes
sion
al a
nd
N/A
Yes
28 fi
eld
offic
esN
/A
De
ve
lop
me
nt
deve
lopm
ent;
Ban
k, C
AR
E, h
ost
natu
ral d
isas
ter
com
peti
tive
abro
ad
envi
ronm
enta
l go
vern
men
ts, M
ercy
man
agem
ent
Corp
s In
t’l, U
N,
USA
ID, W
orld
Ban
k
ATO
S C
on
sult
ing
Info
rmat
ion
Lond
on, U
KD
FID
N/A
Conf
lict
Prof
essi
onal
N/A
No
Ove
r 60
UK
N/A
Lim
ite
dte
chno
logy
; of
fices
finan
cial
ser
vice
s;
infr
astr
uctu
re
man
agem
ent
Ba
nk
ab
le F
ron
tie
r Ec
onom
ic
Cam
brid
ge, U
SD
FID
, pri
vate
sec
tor
N/A
N/A
Prof
essi
onal
N/A
No
1,60
0 st
aff
N/A
Ass
oci
ate
sde
velo
pmen
t;
clie
nts
finan
cial
ser
vice
s
Bir
ks
Sin
cla
ir &
Ec
onom
ic a
nd
Dur
ham
, UK
DFI
D, E
C, W
orld
Ban
kN
/AN
/APr
ofes
sion
alN
/AN
/ASe
rvic
es in
N
/A
Ass
oci
ate
s L
tdin
stit
utio
nal
over
40
deve
lopm
ent
coun
trie
s
CD
M I
nte
rna
tio
na
lD
isas
ter
Cam
brid
ge, U
SA
fric
an/A
sian
19
60s
as s
ubsi
diar
y Co
nflic
t an
d Co
mpe
titi
veN
/AN
oN
/AN
/A
assi
stan
ce;
Dev
elop
men
t B
ank,
to C
DM
; app
rox.
198
0na
tura
l dis
aste
r
econ
omic
and
C
AR
E, D
FID
, hos
thu
man
itar
ian
field
inst
itut
iona
l go
vern
men
ts, S
ave
deve
lopm
ent;
th
e Ch
ildre
n, U
N,
envi
ronm
enta
l U
SAID
, WH
O, W
orld
man
agem
ent;
B
ank,
Wor
ld V
isio
n
heal
th s
ervi
ces
(co
nti
nu
ed
)
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 33
34
HPG BACKGROUND PAPER
Co
mp
an
yW
ha
t th
ey
do
He
ad
qu
art
ers
Ma
in c
lie
nts
Es
tab
lis
hm
en
t/S
ett
ing
*R
ela
tio
ns
hip
M
oti
vati
on
fo
r s
ell
ing
Fe
ma
le-
ow
ne
dS
ize
**
An
nu
al
ex
iste
nce
in
w
ith
NG
Os
this
se
rvic
ere
ven
ue
hu
ma
nit
ari
an
fie
ld
Ch
ecc
i a
nd
Ec
onom
ic a
nd
Was
hing
ton
A
sian
Dev
elop
men
t 19
51
Conf
lict
Com
peti
tive
N/A
No
Serv
ices
in
N/A
Co
mp
an
yin
stit
utio
nal
D.C
.,US
Ban
k, h
ost
over
145
Co
nsu
ltin
gde
velo
pmen
tgo
vern
men
ts, U
SAID
,co
untr
ies
Wor
ld B
ank
Ch
em
on
ics
Dis
aste
r as
sist
ance
; W
ashi
ngto
n U
SAID
(90
%)
1975
; app
rox.
200
1 Co
nflic
t an
d Pr
ofes
sion
al a
nd
Mee
t ne
ed fo
r po
st-
No
Ove
r 20
00
USD
250m
econ
omic
and
D.C
., U
S hu
man
itar
ian
field
natu
ral d
isas
ter
com
peti
tive
conf
lict
acti
viti
esst
aff;
ser
vice
s in
135
to
tal;
USD
inst
itut
iona
l co
untr
ies
20–3
0m in
deve
lopm
ent;
hu
man
itaria
n
envi
ronm
enta
l U
SD50
m fo
r
man
agem
ent;
al
l pro
ject
s in
finan
cial
ser
vice
s;
Cris
is
heal
th s
ervi
ces
Prev
enti
on &
Reco
very
depa
rtm
ent
Cre
ati
ve
Ass
oci
ate
sIn
stit
utio
nal
Was
hing
ton
USA
ID (
90%
),
1977
Co
nflic
tCo
mpe
titi
veN
/AYe
s20
0 st
aff;
14
USD
73m
tota
l
Inte
rna
tio
na
l, I
nc
deve
lopm
ent
D.C
., U
SW
orld
Ban
kfie
ld o
ffic
esin
fisc
al y
ear
abro
ad20
03
Cro
wn
Ag
en
tsD
isas
ter a
ssis
tanc
e;Su
tton
, UK
DFI
D, E
C, h
ost
1833
Co
nflic
t an
d Pr
ofes
sion
alN
/AN
/A1,
000
staf
f;
USD
37m
tota
l
econ
omic
and
gove
rnm
ents
, UN
,na
tura
l ap
prox
. 40
in fi
scal
yea
r
inst
itut
iona
l W
orld
Ban
kdi
sast
erfie
ld o
ffic
es20
03
deve
lopm
ent;
ab
road
;
finan
cial
ser
vice
s;
serv
ices
in
proc
urem
ent
over
110
coun
trie
s
Cu
i P
RO
DE
ST
Conf
lict
Ro
me,
Ital
yH
ost
gove
rnm
ents
, N
/ACo
nflic
t an
d N
/AN
/AN
o20
00 s
taff
N/A
man
agem
ent;
U
S D
epar
tmen
t of
na
tura
l
disa
ster
ass
ista
nce
Stat
e, U
N, U
SAID
, di
sast
er
Wor
ld B
ank
De
ve
lop
me
nt
Dis
aste
r as
sist
ance
; B
ethe
sda,
US
Afr
ican
Dev
elop
men
t 19
70
Conf
lict
and
Com
peti
tive
N/A
No
2800
sta
ff;
N
/A
Alt
ern
ati
ve
s In
c.en
viro
nmen
tal
Ban
k, h
ost
natu
ral
serv
ices
in
man
agem
ent;
go
vern
men
ts, p
riva
te
disa
ster
over
150
econ
omic
and
se
ctor
clie
nts,
USA
ID,
coun
trie
s
inst
itut
iona
l W
orld
Ban
k
deve
lopm
ent;
finan
cial
ser
vice
s;
heal
th s
ervi
ces;
polic
y m
akin
g
Ap
pe
nd
ix I
I (c
on
t)
Re
su
lts
of
sco
pin
g e
xe
rcis
e o
f co
mm
erc
ial
bu
sin
es
s e
ng
ag
em
en
t in
hu
ma
nit
ari
an
re
lie
f
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 34
35
HPG BACKGROUND PAPERD
ev
elo
pm
en
t Ec
onom
ic a
nd
Arl
ingt
on, U
SA
fric
an/A
sian
19
69
N/A
Prof
essi
onal
and
N
/AN
/A7
field
off
ices
N
/A
Ass
oci
ate
sin
stit
utio
nal
Dev
elop
men
t B
ank,
co
mpe
titi
veab
road
;
deve
lopm
ent;
ho
st g
over
nmen
ts,
serv
ices
in
heal
th s
ervi
ces
UN
, USA
ID, U
S ov
er 1
00
Dep
artm
ent
of S
tate
, co
untr
ies
WH
O, W
orld
Ban
k
DP
K C
on
sult
ing
Inst
itut
iona
l Sa
n Fr
anci
sco,
A
sian
Dev
elop
men
t N
/ACo
nflic
tPr
ofes
sion
al a
nd
N/A
No
N/A
N/A
deve
lopm
ent;
US
Ban
k, h
ost
com
peti
tive
tech
nica
l ass
ista
nce
gove
rnm
ents
, UN
,
USA
ID, W
orld
Ban
k
Em
erg
ing
Ma
rke
ts
Econ
omic
and
B
russ
els,
D
FID
, EU
, USA
ID,
1991
Co
nflic
tCo
mpe
titi
veN
/AN
oN
/AN
/A
Gro
up
inst
itut
iona
l B
elgi
umW
orld
Ban
k
deve
lopm
ent;
finan
cial
ser
vice
s;
heal
th s
ervi
ces
En
terp
lan
Ltd
Econ
omic
and
Re
adin
g, U
KA
fric
an/A
sian
19
85
Conf
lict
and
Prof
essi
onal
N/A
No
Serv
ices
in
N/A
inst
itut
iona
l D
evel
opm
ent
Ban
k,na
tura
l ov
er 1
00
deve
lopm
ent
DFI
D, E
U, h
ost
disa
ster
coun
trie
s
gove
rnm
ents
, pri
vate
sect
or c
lient
s, U
SAID
En
vir
on
me
nta
l En
viro
nmen
tal
UK
Asi
an D
evel
opm
ent
1971
N
/APr
ofes
sion
alN
/AN
/Aov
er 2
500
U
SD42
5.4m
Re
sou
rce
s m
anag
emen
t;
Ban
k, D
FID
, EU
, st
aff;
100
tota
l in
fisca
l
Ma
na
ge
me
nt
Gro
up
heal
th s
ervi
ces;
priv
ate
sect
or c
lient
s,fie
ld o
ffic
esye
ar 2
005
inst
itut
iona
l U
N, W
orld
Ban
k in
39
deve
lopm
ent
coun
trie
s
Futu
res
Gro
up
Hea
lth
serv
ices
; W
ashi
ngto
n H
ost
gove
rnm
ents
, 19
71
Conf
lict
Prof
essi
onal
N/A
N/A
Serv
ices
in
N/A
Inte
rna
tio
na
l/po
licy
mak
ing;
D.C
., U
S pr
ivat
e se
ctor
clie
nts,
over
100
Co
nst
ell
a F
utu
res
tech
nica
l ass
ista
nce
USA
IDco
untr
ies;
46 fi
eld
offic
es in
34
coun
trie
s
Ge
ne
sis
An
aly
tics
Ec
onom
ic a
nd
Sout
h A
fric
aD
FID
, hos
t N
/AN
atur
al
Prof
essi
onal
N/A
N/A
N/A
N/A
(Pty
) L
td.
inst
itut
iona
l go
vern
men
ts, O
ECD
, di
sast
er
deve
lopm
ent
priv
ate
sect
or c
lient
s,
USA
ID, W
orld
Ban
k
Inte
rna
tio
na
l D
isas
ter
assi
stan
ce;
Was
hing
ton
Afr
ican
/Asi
an
1978
; app
rox.
Co
nflic
t an
d Pr
ofes
sion
al a
nd
N/A
No
Serv
ices
in
USD
52m
tot
al
Re
sou
rce
s G
rou
pec
onom
ic a
ndD
.C.,
US
Dev
elop
men
t B
ank,
19
96 h
uman
itar
ian
natu
ral
com
peti
tive
mor
e th
an
in fi
scal
yea
r
inst
itut
iona
l C
AR
E, M
ercy
Cor
ps,
field
disa
ster
137
coun
trie
s20
03
deve
lopm
ent;
pr
ivat
e se
ctor
clie
nts,
envi
ronm
enta
l U
N, U
SAID
, WH
O,
man
agem
ent
Wor
ld B
ank
(co
nti
nu
ed
)
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 35
36
HPG BACKGROUND PAPER
Co
mp
an
yW
ha
t th
ey
do
He
ad
qu
art
ers
Ma
in c
lie
nts
Es
tab
lis
hm
en
t/S
ett
ing
*R
ela
tio
ns
hip
M
oti
vati
on
fo
r s
ell
ing
Fe
ma
le-
ow
ne
dS
ize
**
An
nu
al
ex
iste
nce
in
w
ith
NG
Os
this
se
rvic
ere
ven
ue
hu
ma
nit
ari
an
fie
ld
Inte
rWo
rks
LLC
Dis
aste
r as
sist
ance
; M
adis
on, U
SC
AR
E, p
riva
te s
ecto
r 19
90Co
nflic
t an
d Pr
ofes
sion
al a
nd
Bel
ief i
n hu
man
itar
ian
N/A
9 st
aff;
N
/A
econ
omic
and
cl
ient
s, S
ave
the
natu
ral
com
peti
tive
caus
es; a
bilit
y to
be
serv
ices
in
inst
itut
iona
l Ch
ildre
n, U
N, U
SAID
, di
sast
erfle
xibl
e, e
ntre
pren
euria
l,ov
er 1
05
deve
lopm
ent;
W
FP, W
orld
Ban
kin
nova
te a
s a
for-
prof
itco
untr
ies
envi
ronm
enta
l
man
agem
ent
Ma
na
ge
me
nt
Dis
aste
r as
sist
ance
; W
ashi
ngto
n A
fric
an/A
sian
19
81
Conf
lict
and
Prof
essi
onal
and
N
/AYe
s90
sta
ffU
SD20
m
Sys
tem
s ec
onom
ic a
nd
DC,
US
Dev
elop
men
t B
ank,
natu
ral
com
peti
tive
tota
l
Inte
rna
tio
na
lin
stit
utio
nal
CA
RE,
hos
t di
sast
er
deve
lopm
ent;
go
vern
men
ts, p
riva
te
envi
ronm
enta
l se
ctor
clie
nts,
USA
ID,
deve
lopm
ent
UN
, Wor
ld B
ank,
Wor
ld V
isio
n
Oxf
ord
Po
licy
Ec
onom
ic a
nd
Oxf
ord,
UK
DFI
DN
/AN
/APr
ofes
sion
alN
/AN
oN
/AN
/A
Ma
na
ge
me
nt
inst
itut
iona
l
deve
lopm
ent;
polic
y m
akin
g
PAD
CO A
ECO
MD
isas
ter
Was
hing
ton
Hos
t go
vern
men
ts,
1965
; 200
2 Co
nflic
t an
d Pr
ofes
sion
al a
nd
Mee
t ne
ed fo
r po
st-
No
100
staf
f in
Ove
r U
SD
assi
stan
ce;
DC,
US
priv
ate
sect
or c
lient
s,hu
man
itar
ian
field
na
tura
l co
mpe
titi
veco
nflic
t ac
tivi
ties
DC,
100
sta
ff
55m
tot
al in
econ
omic
and
U
SAID
, UN
, di
sast
erin
doz
en
fisca
l yea
r
inst
itut
iona
l W
orld
Ban
kof
fices
abr
oad
2005
deve
lopm
ent;
(P
AD
CO)
(PA
DCO
)
finan
cial
ser
vice
s
PM
TC
In
tern
ati
on
al
Econ
omic
and
B
edfo
rdsh
ire,
C
AR
E, D
FID
, EU
, UN
1993
N
/APr
ofes
sion
alN
/AN
o14
sta
ff in
UK,
N
/A
Ltd
inst
itut
iona
l U
K10
sta
ff in
tw
o
deve
lopm
ent;
of
fices
abr
oad
envi
ronm
enta
l
man
agem
ent
QE
D G
rou
pEc
onom
ic a
nd
Was
hing
ton
USA
ID, U
S N
/ACo
nflic
tPr
ofes
sion
alN
/AYe
sN
/AU
SD6.
7m
inst
itut
iona
l D
C, U
SD
epar
tmen
t of
Sta
te,
tota
l
deve
lopm
ent;
W
orld
Ban
k
heal
th s
ervi
ces;
polic
y m
akin
g;
tech
nica
l
assi
stan
ce
Ap
pe
nd
ix I
I (c
on
t)
Re
su
lts
of
sco
pin
g e
xe
rcis
e o
f co
mm
erc
ial
bu
sin
es
s e
ng
ag
em
en
t in
hu
ma
nit
ari
an
re
lie
f
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 36
37
HPG BACKGROUND PAPERS
eg
ura
Co
nsu
ltin
gEc
onom
ic
Bet
hesd
a, U
SH
ost
gove
rnm
ents
, N
/ACo
nflic
tPr
ofes
sion
alN
/AN
/AN
/AN
/A
deve
lopm
ent
priv
ate
sect
or c
lient
s,
USA
ID, W
orld
Ban
k
So
cia
l D
eve
lop
me
nt
Dis
aste
r as
sist
ance
; Lo
ndon
, UK
Hos
t go
vern
men
ts,
N/A
N/A
Prof
essi
onal
N/A
N/A
N/A
N/A
Dir
ect
Ltd
econ
omic
and
NG
Os,
inte
rnat
iona
l
soci
al d
evel
opm
ent;
ag
enci
es
heal
th s
ervi
ces
Th
e I
DL
Gro
up
Econ
omic
and
B
rist
ol, U
KD
FID
, int
erna
tion
al
1993
Co
nflic
t an
d Pr
ofes
sion
al a
nd
N/A
No
16 s
taff
N/A
inst
itut
iona
l ag
enci
es, p
riva
te
natu
ral
com
peti
tive
deve
lopm
ent;
se
ctor
clie
nts
disa
ster
envi
ronm
enta
l
man
agem
ent
Th
e L
aw
an
d
Econ
omic
and
Lo
ndon
, UK
DFI
D, E
U, U
N,
N/A
Conf
lict
and
Com
peti
tive
N/A
N/A
1 of
fice
N/A
De
ve
lop
me
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GPPI Brief/paper2nd 12/6/07 3:51 pm Page 37
In order to gain a better understanding of the structure,management and contribution of the initiatives under review,five case studies were conducted. In selecting the five cases, anumber of criteria were applied. First, given that the discussionsshould illustrate the full breadth of business engagement inhumanitarian action, a balance of types of initiative (single-company initiatives, partnerships, meta-initiatives) was chosen.The cases also reflect the diversity of industries engaged inhumanitarian action, while still highlighting the specialcontribution made by logistics and IT/telecommunicationsfirms. Despite the fact that most initiatives focus on relief afternatural disasters, an example of post-conflict aid is alsoconsidered, in order to provide a comprehensive picture of thetypes of business engagement. Finally, while most of theinitiatives are relatively new, one longer-term initiative wasincluded to give perspective on how such initiatives evolve overtime. As indicated above, the role of small- and medium-sizedcompanies is not covered in our research. Many small-businessinitiatives are set up to help with disaster relief if the companiesare already based where a disaster strikes, but in looking fortrends we chose to focus on large firms, which are most likely tohave an impact on the humanitarian sector.
Case 1: Deutsche Post World Net/DHL Partnership with
the United Nations: ‘We deliver help’
DHL is a subsidiary of Deutsche Post World Net, an inter-nationalexpress and logistics provider. Its partnership with UNDP andOCHA was launched in December 2005. In coordin-ation withOCHA, Disaster Response Teams are deployed for up to threeweeks, to manage airport logistics and in the immediateaftermath of major sudden-onset disasters. Currently, there is aSingapore-based Team for Asia and the Pacific Region and aMiami-based Team for Latin America. A Team for the Middle Eastand Africa is planned.46
The partnership with UNDP is still in development, but potentialfuture projects include disaster preparation, public education,emergency logistics planning and tracking relief supplies.47 TheDHL Disaster Response Team’s first deployment was in May2006, when Bakornas, the Indonesian government relief agency,asked the Disaster Response Team to provide logistical supportand expertise in the aftermath of an earthquake in Java.48
Rather than providing direct financial support to humanitarianrelief missions, DHL seeks to support its humanitarian relief
partners, such as the UN, primarily by contributing its corecompetency in transport and logistics. According to DeutschePost World Net, giving in-kind through expertise and employeevolunteers has kept the fixed costs, after the initial set up,relatively low.49 The partnership is also ‘the perfect way todemonstrate our strong commitment to Corporate SocialResponsibility’, according to Monika Wulf-Mathies of DeutschePost World Net (see Deutsche Post World Net, 2006). It hasreportedly enhanced productivity and decreased staff turnover.The partnership allows DHL to increase brand visibility and towork with the UN, which it chose as a partner due to the UN’s‘credibility and legitimacy and, of course, its global reach’.50
Disaster Response Teams are deployed when circumstancesare deemed appropriate for involvement by DHL, and aninvitation is extended from the host government. Involvementis restricted to major sudden-onset natural disasters becauseof the likelihood of airports becoming overwhelmed. TheDisaster Response Teams are too new to distil lessons fromthem, and no independent evaluation of DHL’s partnershipwith the UN has been conducted.
Case 2: TNT’s ‘Moving the World’ programme
Launched in 2002, ‘Moving the World’ brought together thelogistics company TNT – a division of TPG, a Dutch mail andlogistics company, with annual revenues of approximately $14.4billion (2003) – and WFP (see Maitland, 2004; for a shortdescription of the partnership see also Witte and Reinicke, 2005:25). TNT selected WFP as a partner organisation because of itsexperience in logistics, its global reach and its positive brandimage. It was also a good organisational fit (WFP’s executivedirector has a corporate background that reportedly facilitatedcommunication and understanding).51 Through the partnership,TNT has agreed to contribute €5 million a year (approximately$6.3 million) for five years, and jointly cooperate in five areas:school feeding support, private sector fundraising, emergencyresponse, logistics and transparency and accountability.
An extension to the partnership is anticipated once theagreement officially expires in 2007 (see Tomasini andWassenhove, 2004, and Samii, 2004). However, while publicevaluations from WFP have commented favourably onexperiences with TNT, WFP also notes that it is searching foradditional logistics partners to complement TNT’s role inproviding warehousing space, office equipment and airport
38
HPG BACKGROUND PAPER
Appendix IIICase studies of business engagement in humanitarian relief
46 Interview by the authors with representative of Deutsche Post WorldNet, May 2006.47 Interview by the authors with representative of Deutsche Post WorldNet, May 2006 and Deutsche Post World Net, 2005.48 Interview by the authors with a representative of Deutsche Post WorldNet, October 2006.
49 Interview by the authors with a representative from Deutsche Post WorldNet, 18 May 2006. No detailed numbers were available from Deutsche PostWorld Net.50 Interview by the authors with representative from Deutsche Post WorldNet, 18 May 2006.51 Ibid.
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 38
39
HPG BACKGROUND PAPER
handling assistance (WFP website – http://documents.wfp.org/stellent/groups/public/documents/eb/wfp080322.pdf ).
The key motivation behind the partnership, according to TNTexecutives, is to make a contribution to ending world hunger.52
TNT recognises that, as a logistics company, it can offer more byleveraging its core business expertise and assets in apartnership, than by simply donating money (see Maitland,2004). However, the partnership has also been a strategicresponse to growing stakeholder pressure to demonstrate CSR.Indeed, when TNT began initial planning for its engagementwith WFP, most of its main competitors were already engaged insuch CSR activities (see Tomasini and Wassenhove, 2004).
Through the partnership, TNT also seeks to increase cohesionbetween the three business units (mail, logistics, express)operating under its name, improve brand image, motivate staffand attract prospective employees. Finally, it hopes to gain acompetitive edge by expanding on its core competencies,protecting its supply chain and ensuring the quick recovery ofbusiness operations in the event of a disaster. TNT treats thepartnership like a business unit, with a budget, targets andquarterly progress reviews (see Maitland, 2004). To ensure thelong-term commitment of TNT, each member of the executiveboard sponsors part of the programme (see Maitland, 2004;Tomasini and Wassenhove, 2004).
Case 3: Management Systems International (MSI)53
MSI is a privately owned consulting firm based in Washington.Founded in 1981, the firm currently has approximately 90employees and annual revenues of approximately $20 million.Besides offering management services in private sectordevelopment, governance and environmental issues, MSI alsoprovides services to USAID under the Instability, Crisis, andRecovery Program (ICRP). MSI’s programme includes earlywarning and analysis of conflicts, and the design of conflict-sensitive programmes in areas such as health, democracy andgovernance. In addition to the ICRP, MSI works in cooperationwith the USAID Office of Conflict Management and Mitigation(CMM) in the disarmament, demobilisation and reintegrationof ex-combatants. It also provides mediation and negotiationservices, as well as training for USAID staff and local NGOs onconflict-sensitive programming.
Besides USAID, the firm’s other major clients includemultilateral organisations, universities, NGOs and privatecorporations. MSI’s partners in the planning and implement-ation of projects are other development consultancy firms suchas ASID, Cui PRODEST, Louis Berger Group and Vision Latina;universities and research institutes; and NGOs such asInternational Alert and Mercy Corps. Information on the
principles and motivations underlying MSI’s work is notavailable, as statements were not clear from their websitehomepage and MSI did not afford us an interview.
Case 4: Planning and Development Collaborative
International (PADCO)54
Founded in 1966, PADCO is an international developmentconsulting firm and an operating company of AECOM, aconsortium of major architecture and engineering firms. PADCOis based in Washington, and employs approximately 200 peoplein approximately a dozen country offices. It has annual revenuesof over $55 million. Its main clients are USAID, the World Bank,the Asian Development Bank, other bilateral and multilateraldonors, national and local governments and private sectorcompanies. Its areas of expertise are (1) conflict resolution,comprising peace-building, reconciliation, early warning,conflict prevention, dispute resolution and mediation; (2)democracy and governance; (3) humanitarian response andreconstruction, including response to natural and man-madedisasters and complex emergencies, disaster mitigation,community-based reconstruction and field-based grantsmanagement; (3) sustainable economic development; and (4)urban services.
PADCO works for USAID under the Managing African Conflict(MAC) programme, which began in 2003 and runs until 2008.Under this contract, PADCO provides services in conflictprevention, mitigation and response for USAID missionsthroughout Africa. These services mainly comprise trainingand technical assistance to intergovernmental, governmentaland non-governmental actors in the field. Beyond this generalconflict resolution engagement in Africa, PADCO managed aproject in Senegal in 2004–2005. The project included anassessment period as well as a technical assistance, orcapacity-building, phase. Another conflict resolution projecttook place in Uganda 2004–2005, in which PADCO assisted theUgandan government in the preparations for peace talks.Finally, PADCO has a two-year community-based peace andreconciliation initiative in Burundi.
In the field of disaster response and reconstruction, PADCOhad two major projects throughout 2004 and 2005. The 2005‘Caribbean Regional Community Revitalization’ project inTobago and the Bahamas was a disaster mitigation project. Itincluded recovery activities such as housing repair, housingconstruction and land stabilisation to mitigate the risk offuture landslides and flooding after Hurricane Ivan. The‘Grenada and Jamaica Community Revitalization I and II’project was a two-year initiative running during 2004–2005.Here, PADCO repaired damaged houses, managed communityclean-up and undertook land and watershed rehabilitationefforts. It also assisted in restoring health clinics and primary52 Interview by the authors with an NGO representative, June 2004.
53 This case example is based on information from the company’shomepage (www.msiworldwide.com), as well as on information providedby the Windfalls of War Project of the Center for Public Integrity(www.publicintegrity.org/wow/bio.aspx?act=pro&ddlC=36).
54 This case example is based on information from the company’shomepage (www.padco.aecom.com) and on an interview with arepresentative of PADCO conducted by the authors in July 2006.
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 39
schools, providing the latter with equipment and furniture.PADCO presented workshops and training programmes on thefinancial management and construction of housing, oncommunity clean-up initiatives, and on disaster preparednessand mitigation. In addition, the firm negotiated and awardedsubcontracts and grants to contractors and NGOs forrenovation and repair services. In Grenada and Jamaica,PADCO partnered with local NGOs, local building contractors,community-based organisations, ministries and government-sponsored emergency response organisations.
PADCO bases its work on the principles of integrity, fairnessand responsibility.55 The motivation underlying PADCO’sengagement in humanitarian assistance is allegedly the sameas those inspiring traditional actors, although hints ofstrategic marketing are detectable in official statements. ‘Weare in business to help meet the needs of the millions ofvictims worldwide and provide the finest professional servicesthat can be contracted for recovery from both man-madecomplex and natural disasters’.56
Case 5: CDM International
CDM was established in 1947 as a professional partnership, andlater developed into a consulting, engineering, construction andoperations firm. CDM is a subsidiary of Camp Dresser & McKeeInc., along with CDM Construction Inc. and CDM FederalPrograms Corporation, and is at present employee-owned. CDMhas headquarters in Cambridge, Massachusetts, and provides
consulting, project management, sustainable development,engineering, construction and related services. Compared withMSI and PADCO, CDM is less involved in the implementation ofprojects (with the exception of its engineering and constructionwork), than in programme planning and design. Its main clientsare businesses and industries, development agencies, bilateraland multilateral donors, government ministries, public agenciesand US government agencies. One of CDM’s areas of expertiseis disaster relief and reconstruction in humanitarianemergencies such as earthquakes, floods, hurricanes,landslides, droughts, epidemics, famines and crises resultingfrom armed conflict. The firm provides human resources andmanagement capacities to respond to these disasters. Furtherservices include short-term emergency relief, long-termrecovery through large-scale infrastructure reconstruction,programme management, procurement and institutionalcapacity-building. Following the 2000 flooding in Mozambiqueand Madagascar, CDM took the lead on a joint project with theUSAID Office for Foreign Disaster Assistance to undertake aflood-related water, sanitation and health needs assessment.CDM deployed water, sanitation and health specialists toperform assessments, compile data and identify the number ofaffected people. Similar projects were launched in response tofood shortages in Ethiopia and after Hurricane Mitch inNicaragua in 1998.
CDM does not refer to any humanitarian or related principleson its website. It simply states that CDM is ‘committed toethical conduct in our business practices’ (see www.cdm.com/code_of_ethics.htm). Detailed information concerningprinciples and motivations could not be collected, as CDM didnot give us an interview.
40
HPG BACKGROUND PAPER
55 See www.padco.aecom.com/About/39/47/index.jsp.56 Interview with a representative of PADCO conducted by the authors inJuly 2006.
GPPI Brief/paper2nd 12/6/07 3:51 pm Page 40
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HPG BACKGROUND PAPER
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i
Contents
List of abbreviations iii
Executive summary
1
Chapter 1 Introduction 3
Chapter 2 The humanitarian domain: key trends and developments 5
2.1 The transformation of the humanitarian domain: an emerging market? 52.2 The humanitarian domain as a quasi-market dominated by several big players 62.3 Conclusion 7
Chapter 3 The new face of corporate philanthropy? The changing nature of business engagement in 9
humanitarian relief
3.1 Results of scoping exercise 93.2 Analysis and conclusions 123.3 Outlook 17
Chapter 4 A profitable market? Commercial business engagement in humanitarian relief 19
4.1 Donors and commercial business engagement in humanitarian relief 194.2 Results of scoping exercise 204.3 Analysis and conclusions 214.4 Outlook 23
Chapter 5 Conclusions and policy recommendations 25
5.1 Policy recommendations: non-commercial business engagement in humanitarian relief 255.2 Policy recommendations: commercial business engagement in humanitarian relief 265.3 Conclusions 26
Appendix I 29
Appendix II 33
Appendix III 38
References 41
GPPI Brief/paper2nd 12/6/07 3:51 pm Page i
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