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Could businesses do for aid what Amazon did for retail?

Source: Thomson Reuters Foundation - Fri, 18 Jul 2014 10:45 GMT
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A woman stands in the middle of a crowd gathered to receive food aid in Kiwanja, eastern Congo, November 14, 2008. REUTERS/Finbarr O'Reilly
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LONDON (Thomson Reuters Foundation) - The "Peepoo" doesn't look like much more than a green-and-white plastic bag. But in fact it's a single-use, biodegradable toilet that stops faeces from contaminating the immediate area and turns it into fertiliser within a month.

The toilet is manufactured and sold to aid agencies by Swedish-based company Peepoople. It has been used around the world in places that lack basic sanitation - from schools in Nairobi's Kibera slum, to the typhoon-hit city of Tacloban in the Philippines, and camps for Syrians who have fled conflict.

While its popularity is growing, Peepoople's Åsa Angelino says the company didn't find it easy to break into the aid market. "We're often seen as the bad guys," she told a debate on the participation of businesses in humanitarian work in London this week. "We get asked why we set up as a for-profit organisation rather than a (non-profit) NGO."

The reasons for that, she said, are that the profit margin from selling the toilets can both finance more research and be invested in the production line.

This is an important consideration for many businesses when they get involved in emergency relief work, agreed Helena Fraser, chief of the private sector section at the U.N. Office for the Coordination of Humanitarian Affairs (OCHA).

Innovation is vital to improve the delivery of aid, but it also costs money. "It is absurd to think that this will happen without some commercial thinking," she said. "Commercial interests should not be seen as a negative thing."

Randolph Kent, director of the Humanitarian Futures Programme (HFP) at Kings College London and co-author of a new report on the role of the private sector in emergency preparedness and response, underlined the need to break down barriers between the aid and business communities.

"It's a question of people getting out there and engaging with each other," he said.

For example, aid agencies could invite in business people to work with them, but not on the basis of traditional corporate social responsibility or philanthropic approaches. "They should ask instead what is our respective value-add and comparative advantages?" Kent said.

HI-TECH EDGE

The report, issued by the HFP and the Overseas Development Institute (ODI), argues that rather than cash donations, "optimism surrounding private sector engagement is rooted in the innovations, new technologies and other capabilities that businesses can bring to the humanitarian enterprise".

"With significant logistical abilities, massive resources invested in R&D and highly capable personnel, many within the aid community hope that businesses can do for humanitarian aid what Amazon did for the world of retail or what Microsoft and Apple did for personal computing," it says.

The researchers also conducted four country case studies that included examples of insurers offering drought cover in Kenya, a bank in Jordan assisting the World Food Programme with an e-voucher system for Syrian refugees, and banks and telecoms companies providing mobile money systems in post-earthquake Haiti.

Steven A. Zyck, an ODI research fellow who co-wrote the report, said businesses acting in humanitarian crises is nothing new. They are often among the first to respond to disasters, bringing in supplies and getting markets up and running again. Many move quickly to protect and support their own staff and families when they're affected.

The opportunities for the aid community to cooperate with the private sector will increase in future, Zyck said - especially when it comes to challenges like climate change, pandemics and technological failures, where businesses have a competitive advantage.

"There is a new breed of daunting challenges that aid agencies are not well equipped to handle," he said.

In addition, some middle-income countries collaborate with the private sector when disasters hit in the hope it will boost economic growth down the line.

Other nations prefer dealing with business partners to international government donors that might put conditions on aid. Or they want to get away from the image of "a devastated country in a shambles," Zyck said.

HAIYAN POINT PERSON

Private companies played a prominent role in the relief effort after super typhoon Haiyan barrelled across the Philippines last November.

OCHA deployed someone specifically to liaise with businesses and channel offers of help to the right parts of the humanitarian system.

But there's still a lot that could be done better, Fraser noted. After Haiyan, for example, the private sector had organised within days into groups focused on different activities, such as shelter, but no connection was made with the humanitarian "clusters" working on similar issues.

At the behest of U.N. aid chief Valerie Amos, OCHA is now making a push to find practical ways of working with the private sector, as are many donor governments and a growing number of aid charities.

Fraser said the 80 local networks of the United Nations Global Compact, a U.N. initiative for businesses committed to 10 principles in the areas of human rights, labour, the environment and anti-corruption, could be a good starting point - but efforts should be made to forge links before disasters happen.

The HFP/ODI report makes recommendations for strengthening cooperation - from setting up information hubs to contacting chambers of commerce and finding ways to help small businesses get back on their feet after a disaster.

"If traditional humanitarian actors do not more fully open themselves to private sector partnerships and approaches, they may grow less relevant," the report said. 

(Editing by Ros Russell; rosalind.russell@thomsonreuters.com)

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