July 24, 2017    6 minute read

Making Famine Relief a Private Sector Enterprise

Paying It Forward    July 24, 2017    6 minute read

Making Famine Relief a Private Sector Enterprise

Thanks to ongoing conflicts, twenty million people in some of the world’s poorest countries are now at risk of famine. To respond to the pressing needs of communities in Nigeria, Somalia, South Sudan, and Yemen, international aid organisations including CARE, Oxfam, Save the Children and the International Rescue Committee have banded together to form the Global Emergency Response Coalition in the United States. The Coalition, alarmed at the lack of global attention to these multiple crises, has turned to the American public – and the private sector – for funds to carry out relief work.

Fortunately, the private sector is answering – and they may even be contributing to a new model for corporate social responsibility (CSR) that can be applied to future emergencies. The Global Emergency Response Coalition has managed to attract some critical corporate partners, and more will likely follow. They include BlackRock, the world’s largest asset manager, as well as PepsiCo and Visa but also tech giants Google and Twitter. The PepsiCo Foundation and BlackRock have promised to match public gifts to the Coalition, up to $1 million each.

Efficiency and Impact

On the face of it, those sums sound like a pittance compared to what the American government spends. In the current US fiscal year, Washington has already allocated over $2 billion for anti-famine efforts. Behind those numbers, though, lies a stark reality: the traditional international donor community, and especially donor governments, have a poor track record when it comes to effectively delivering resources when they are most needed. Bitter debates over American foreign aid spending have further muddied the waters as to the reliability that funding. The same President Trump that promised Pope Francis he would augment famine relief by $329 million also proposed cutting that funding by over $1 billion.

Source: ACT Alliance

Somalis, who have endured as much deprivation as anybody, can speak to this: the last time a major famine hit, in 2011, the international community’s aid only arrived after most of the famine’s 260,000 victims had already died. This time does not appear to be different, and the UN’s funding appeal for famine relief has only managed to hit 49% of its funding goal. Those donors also tend to be distracted by other priorities, failing to see the linkages between issues like counterterrorism or security and humanitarian crises. When the UN organised a conference on Somalia in London this past May, security was the most prominent item on the agenda.

This is where the private sector has a critical role to play. This dynamic has played out in Africa before, such as at the height of the Ebola epidemic in West Africa in 2014. The World Health Organisation (WHO) wasted precious months before finally declaring a public health emergency and mobilising resources. Fortunately, private aid organisations and a few foreign companies in the afflicted countries did not wait for the WHO’s belated decision. Instead, they sprang into action on the front lines of the epidemic.

Learning from the Private Sector Ebola Response

The Ebola crisis placed the spotlight on foreign companies that were willing to brave the dangers posed by the disease and leverage their roles as local employers and investors. The Russian aluminium company UC Rusal, for example, is one of the largest foreign investors in Guinea. At the outbreak of the Ebola epidemic, many other aluminium companies in the bauxite-rich country – especially Chinese companies – left in a hurry. Rusal, however, spent $10 million building a treatment facility that took in afflicted locals and will soon host trials of a Russian Ebola vaccine. The treatment centre managed to tally an impressive treatment rate, with 62.5% of patients reportedly recovering.

Even though the outbreak is now over, the centre represents exactly the kind of healthcare infrastructure resource Guinea needs most: the Russian company is repurposing it as a diagnostics centre for future infectious disease outbreaks, including but not limited to Ebola. The hope is that centres like this one will catch outbreaks more quickly, facilitating a rapid response.

In neighbouring Liberia, Firestone offered another effective example of private sector response. When Ebola was detected in the company town of Harbel, home to a Firestone rubber plantation, Firestone built its own dedicated treatment centre. Firestone’s hospitals, clinics, and schools were repurposed to serve the surrounded communities, taking in patients and serving as quarantine quarters for patients and their families. Like UC Rusal, Firestone put its on-to-ground infrastructure and immense resources to work in order to fight the epidemic. Without the company’s active presence, it is hard to say what would have happened to those communities.

Breaking the Cycle of Crisis

Of course, neither company would have been as effective in contributing to the Ebola response effort without significant operations on the ground. In many of the areas currently at risk of famine, like northern Nigeria and Somalia, long-running conflicts make outside investment and private sector involvement difficult, if not impossible. Conflict is, in fact, what all of these places have in common: the most recent instances of famine helped push the World Bank to reclassify conflict as the primary driver of “suffering and poverty” last year. It is what the Bank calls a cycle of crisis: poor management of land and water resources and fighting over those same resources feed into each other, exacerbated by the impacts of climate change and natural phenomena like droughts.

Breaking that cycle requires a proactive, preventive approach, and this is where private companies looking to pursue CSR objectives can do the most good. Alongside its financial contributions to the new Coalition, PepsiCo has been pursuing this type of local engagement through public-private partnerships. The brand has taken part in projects to boost chickpea production (and thus overall food security) alongside the World Food Programme and USAID in Ethiopia and deliver clean water with the Inter-American Development Bank in Latin America. Of course, those efforts still can’t match its own merchandising in scale. As Akinwumi Adesina of the African Development Bank put it last month, “you can find Coca-Cola or Pepsi anywhere in rural Africa, so why can’t you find seeds?”

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