Is the private sector response to Haiyan a foretaste of things to come?

by Thin Lei Win | @thinink | Thomson Reuters Foundation
Wednesday, 27 November 2013 17:10 GMT

A boy carries a bucket of water to his family's makeshift housing in the eastern Samar coastal village of Hernani. 10 days after it was hit by Typhoon Haiyan. Photo November 18 2013, REUTERS/Wolfgang Rattay

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* Any views expressed in this opinion piece are those of the author and not of Thomson Reuters Foundation.

As the traditional aid funding pie gets smaller and aid agencies wring their hands over how to respond to weather- and conflict-related disasters, the private sector is jumping in to fill some of the gaps

BANGKOK (Thomson Reuters Foundation) - Two days after one of the strongest storms ever recorded made landfall in the central Philippines, Tim Hansing, CEO of a Bangkok-based hotel investment company with properties in the disaster-prone Southeast Asian country, called his Philippines office. 

He was told everybody was fine but the families of a couple of the staff had disappeared in Palo, a town some 10 km from Tacloban, one of the hardest-hit areas.

“I asked what we could do and the country head said, ‘They’re desperate for water’. So I said ‘Go for it’,” said Hansing, speaking from his office in a gleaming central Bangkok skyscraper. 

By Nov. 13, less than a week after the typhoon, 100,000 litres of water and 5,000 kgs of rice were on their way to Palo, with an escort. Some aid also went to Tacloban and Basey, a village in Samar province. 

It was the first time the company had got involved in disaster relief. 

This correspondent was in Tacloban just days after the typhoon and saw the logistical challenges at first hand. Roads and bridges were damaged and covered in debris. There were hardly any vehicles, fuel was scarce, and transporting goods just 11 km from Tacloban’s airport to the city was taking hours, let alone reaching towns further away.

So the quick response by Red Planet, Hansing’s company which develops, owns and operates Tune Hotels – which are affiliated with regional budget airline Air Asia - was remarkable. 

Hansing says the speed was due to having people he trusts on the ground and to leveraging his firm's  business contacts. He also sees a growing trend of companies big and small getting into humanitarian relief, driven by investors, executives and employees. 

BEING NIMBLE

Red Planet is a young company, only 3-1/2 years old and without the deep pockets of firms like Coca-Cola, IKEA and HSBC, all of which have pledged between $1 million and $5.6 million in cash and material aid for survivors of Haiyan. 

But the company is growing fast. It currently has 14 Tune Hotels in Thailand, Indonesia, the Philippines and Japan – and it wants to be a good corporate citizen. 

It has raised $25,000 - from staff in the region, matched by the company - for a longer-term project in Palo. 

“We’re going to approach one of our main contractors and ask them for free labour and project management, we’d use the money to buy cement and bricks at cost through the contractor, and we’ll build some community resource,” Hansing said. 

“Maybe we can go and maintain it as part of our CSR (corporate social responsibility programme),” he added. 

The company also partnered Air Asia for the “To Philippines With Love” campaign, in which aid workers and rescue personnel get free flights and overnight stays. Red Planet says it had donated around 540 nights as of Nov. 21.  

“It’s about using what you’ve got,” said Hansing, adding that aid agencies should learn from the private sector to be nimble. “They behave like bureaucrats and I guess there’s a certain process that they’ve decided is the best thing to do. But I do think there’s a common sense factor to it. When something like this happens, it’s going to be food and water that’s needed,” he said. 

“The private sector lives and dies on its feet,” he added. 

SIGN OF THINGS TO COME?

Of course it’s naive to assume the private sector would replace aid agencies or donors, but it’s playing an important role, whether by providing aid directly like Red Planet or supporting UNICEF and MSF as the IKEA Foundation is doing. Companies have pledged millions for Haiyan relief, at a time when financial resources for humanitarian aid are dwindling. 

In 2011, bilateral development aid and humanitarian assistance shrank for the first time since 1997 and the trend continued in 2012, according to UK-based Global Humanitarian Assistance (GHA), which tracks and analyses aid flows. 

At the same time, aid agencies have been criticised for what detractors see as unnecessary overheads, opaque spending structures and high executive pay. There have been a couple of high profile criticisms in recent weeks, as the devastation wrought by Haiyan became clear. 

“As we get more and more modern-thinking, more dynamic and socially responsible companies, I think you’ll definitely see companies doing more of these things,” said Hansing, adding that investors were also pushing companies in that direction. 

“We’ve got over 100 private investors who are all high net worth individuals. When we were raising money, they wanted to make sure they were investing in a company that is giving back to the community,” he added. 

Asked whether Red Planet would get involved in humanitarian relief again, he replied at once “Absolutely, without a doubt, if we know we could do it and it’s going to have an effect.” 

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