MB: What has been the impact of the pandemic on humanitarian organisations, and how have you adapted to the changing environment?
AF: The International Federation of Red Cross (IFRC) secretariat department, where I work, has played a critical role in responding to the COVID-19 pandemic along with the 192 National Societies that the Secretariat coordinates. Since the start of the pandemic, we have reached 10% of the global population with our Risk Communication and Community Engagement (RCCE), vaccination, in-kind assistance including food provision, psychosocial support and cash and voucher assistance schemes. This massive and unprecedented global effort has been possible thanks to the mobilisation of 2.35B CHF of capital.
Yet, this incredible operation has generated three main challenges:
- The financial sustainability of our National Societies have been put under stress by the execution of this programme
- The long-term socio-economic impacts of the pandemic and management of the recovery phase once the response phase is over has yet to be addressed
- The risk of a compromised response to other humanitarian crises that do not fade away with COVID-19
MB: How has private sector engagement in humanitarian issues evolved over the last few years?
LF: According to our global benchmarking studies, private sector organisations (i.e. corporations and foundations) contribute less than 10% of the total humanitarian funds mobilised each year. On the contrary, private sector support was particularly strong in the response to COVID-19, with their contribution exceeding 32% of the total humanitarian funds raised. We hope this marks the beginning of a new, bigger commitment by the private sector to financially support the humanitarian sector.
There is much more the private sector does in terms of in-kind support, sharing assets, knowledge, technology and goods with humanitarian partners. Businesses do not want to be seen as the donor who signs the check and waits for the report. Instead, they are keen to engage with humanitarian organisations through co-creation, where we develop programmes together.
We are very supportive of this more strategic approach to partnerships, but this co-creation process where the private sector offers their generous in-kind support cannot come at the expense of the much more significant financial support! The $2.5 trillion USD annual gap in financing to achieve the Global Goals (which has further risen to $4.2 Trillion following the COVID-19 pandemic as per recent OECD research) cannot be reduced without a step-change by the private sector, as stated by Global Goal #17.
Alessandro Fedele, Global Head of Private Sector Unit, IFRC
MB: Where are the biggest opportunities for businesses to support HUMANITARIAN organisations?
AF: I see four main opportunities:
1. The provision of more long-term, flexible funds to support strategic global initiatives that tackle big social issues such as Climate Change, Pandemic Prevention, Migration, and Social Inclusion. At IFRC we have a pipeline of global initiatives ready to be rolled out if any global private sector organisation is interested. We cannot plan strategically with small annual earmarked grants!
2. Grant us better access to the core business of private sector organisations. Often the core business of some corporations is instrumental to our humanitarian work; think for instance logistics and communication, as well as technology to support the digital transformation we are currently phasing in to run our operations more efficiently.
3. Help our sector to innovate. We can learn from the private sector on how to innovate and how to design innovation. We can receive financial support to test out new ways of working. Last but not least, we can learn a lot in terms of instrumental competencies and skills such as management, leadership, marketing and communication.
4. Innovative financing. Private capital sources alone amount to more than $200 trillion, making it obvious that funding towards the Global Goals must come from non-governmental sources, and this will require innovative and scalable approaches. The private sector can support the development of innovative financing mechanisms, like new approaches to raising funds and stimulating actions in support of international development which goes beyond traditional spending approaches by either the public or private sector. Humanitarian Impact Bonds, insurance products for disaster response and the Islamic social financing space are just a few examples of a multifaceted area full of untapped opportunities.
MB: What examples have you seen of successful private sector partnerships, and what made them so effective?
AF: I like partnerships that start with our potential partner asking “how they can help”. These partners have a genuine interest in making a difference within the communities they are present in, rather than leveraging a partnership with a humanitarian organisation just to build their corporate and brand reputation. But I am not so naïve. I know we deal with for-profit organisations whose main objective is to generate investment returns for their shareholders. However, every conversation must start by putting the humanitarian issue at its core!
Effective partnerships also start with a clear and shared objective and last for multiple years. Finally, effective partnerships are forged when we operate in full transparency, where doors are open, and the two organisations operate like one single team. This is the premise to building trust, and trust is the key prerequisite for effectiveness.
MB: What advice would you give to small businesses, looking to work with a charity, or NGO, but having limited resources?
AF: I work for the IFRC, the world’s largest humanitarian network, so I am very keen to work with global players to develop large global programmes. There is a risk that small initiatives at the local level end up being inefficient and do not generate real social impact. My advice to small business with limited resources are the following:
- Connect with the local communities you serve
- Partner with local NGOs that are permanently present in these local communities you want to support
- Conduct a proper due diligence of these NGOs before supporting them
- Become part of a larger initiative where your contribution is part of a larger pooled funding mechanism
- Do not go for the cheapest, go for the most professional and effective charity or NGO.