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CSR and Public – Private partnership: before, we used to call this propaganda, corruption or tender procedures.

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This my contribution to the first Aid Blog Forum on Corporate Social Responsibility.

When I look at the different contributions on CSR, the negativity of the academia and practitioners oozes from my screen. For good reason. Who pays the piper calls the tune. And the tune  set by a private partner is seldom purely “needs based”. There will be need for visibility and publicity (CSR is mostly about signallingand branding, Marc Bellemare). The moneyshark will come with his own ideas of what is important and what not (please add at least a micro credit chapter). And you will have to say yes.

What annoys me most is the blurring of the lines. How fast does CSR become single sourcing? How much of what we call CSR can be classified as propaganda, how much are the lines of good procurement procedures blurred by it?

Corporations have an identity, with different concentric circles. In the outer segment, we see branding and marketing. These signal the view of the corporation as they want us to see them. At the core, there is the real identity: cutting corners or maintaining quality even if business is slow. Some companies treat their employees well, some don’t. I could well imagine that CSR fits in the core of a company. When a soccer club sponsors UNICEF, I might believe it is. When a clothing giant campaigns on HIV/AIDS, it looks like marketing to me. It degrades the Cause and puts everything at the service of the bottom line.

Just like developing countries are victim to fickle donors looking for visibility,  CSR campaigns that are aimed to be marketing will sell the soul of their partners, and run off with the next posse.

humanitarian action should act like an insurance including preventive care. It should not depend on the media when aid comes, it should be send when you hit rock bottom. Of course, this kind of assistance acts before children are dying. Very seldom star-based initiatives support flexible funding to UN-bureaucracies. However, this is what we probably need. Prevention is more efficient. Needs based allocation is better than media based allocation. We have standards for servicing the affected populations we can be held accountable to.

Institutional philanthropists and some CSR companies do support such an approach. Most private donors however, don’t. In humanitarian assistance, most CSR seems to follow the flow, and create political incentives against Good humanitarian Donorship. Bono criticized countries for not giving “as much as IKEA” to the Horn of Africa. As far as I know, Ikea does not contribute to the Central Emergency Response Fund.

Somewhere, we must draw the line.

Humanitarian needs and the way we fund the Horn of Africa

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Some important annual milestones for needs based humanitarian donor budgeting just passed: the publication of the 2011 Global Humanitarian Assistance Report and the Mid Year review of the OCHA Consolidated Appeals.

The GHA report analyses the available data on humanitarian funding. It informs you on the reality of funding, in contrast with the fluidity of donor declarations and promises. Donors with a high media visibility might turn out to have low commitments . As an operator in the field, it tells you who funds what where. Compared to other sectors, funding seems to move in a direction where, according to the GHD consensus, more efficient humanitarian assistance is possible. The mid year review gives a snapshot of the needs and funding shortfalls in the different crises, as it is reported through the UN-system.
One of the aims of both documents is to get a better allocation of resources, to have more predictability and better match the donor budgets with the needs.

Indeed, the unspoken consensus on humanitarian assistance is that humanitarian assistance is a moral imperative, a human right, stronger than the “human rights”. When the shit really hits the fan, we will come and help you out. You can count on it. Everywhere. Anywhere. You will get at least what is promised in the Sphere standards. We will not let you sink lower. Your life and dignity will be protected.

Therefore, humanitarian assistance should be organised more like an insurance than like a charity. What is the current mechanics of humanitarian funding, and how is the political economy now, and what should change to become more like an insurance?

The mechanics: The budget cycle
The donor budget cycle starts for most government donors in march of the year before. The first draft of annual (or rolling multi annual) budget is prepared before the mid-year review is received. The only data on needs available are those from the year before. The budget is approved around November in countries with a working government, meaning before Common Appeal is even shared. The input for the budget cycle comes from the common appeal for the year before the budget. Even the review comes too late. The budget cycle is conducive for stable, long term investment in an insurance like scheme, with stable funding.

The mechanics: sudden disasters: the additional funds delusion
When a sudden overwhelming disaster strikes funding of the humanitarian budget is redirected to this new need. Most donors provide with a reserve of 20 % of their budget for sudden onset disasters.
Calls will be placed to liberate “additional funds”. These funds will come in the first place of course from the budgets within the same programme: the allocations for flexible funding or for complex crisis response that was not yet paid in the same year.These other crises will be “forgotten”: all attention goes to the media hog.
If the situation is politically overwhelming, the head of the humanitarian department will have a good hand to fight for additional budgets from other programmes. These will normally be development budgets. Unspent development funds will be transferred to humanitarian assistance. It is extremely rare budgets from outside the development sphere (e.g. unemployment benefits) get transferred to the humanitarian budget for a crisis.

Political economy for budgeting based on sudden disaster spending
This approach leads to an incentive structure for the level of the humanitarian budget that runs against the consensus on humanitarian assistance as a right:
The visibility of complex crisis and predictable funding is limited
The politically experienced needs are mostly in sudden onset disasters.
When it comes to “important crises” the voted humanitarian budget is irrelevant. You could as well accept the need for flexibility, and scrape the money together when disaster strikes. It will make you look good.

The political economy of spending in sudden onset disasters pushes against the principles of Good Humanitarian Donorship and pushes the long term budget provisions down.
Why would you have a high humanitarian budget if you can have a cabinet meeting with media coverage and add from other budgets when there is a political need? In this reasoning, the humanitarian needs are secondary.
It is indeed remarkable that countries with a “presidential” approach to humanitarian spending have lower annual budgets, but also have troops on standby when CNN is filming.

It is normal that the public and even most politicians think humanitarian assistance happens meanly in natural disasters, while in reality 80 % of the funds is spent in complex crises, mostly in civil war zones.

However, something more is at work. I like to call it the incredible moral fibre of the humanitarian donor and agency administration. In some countries, the flexible funding of needs based allocation mechanisms is and stays well funded. Moreover, disaster preparedness and prevention get a good funding, inspite of the political economy.

An alternative approach? Funding instruments
The humanitarian operations by the main actors have moved fast towards an accountable system trying to deliver services according to standards.

Donors should fund instruments that build up reserves and allocate towards the most important needs today in the shifting humanitarian crises. These instruments should be accountable and look for efficiently delivered effectiveness.

There is already an interlocking system with enough redundancy that does just this:
The CERF, DREF and ICRC core funding act as a global system of insurance for humanitarian needs. They can act in sudden disasters and fund forgotten long-term crises.
Most humanitarian agencies have a flexible fund for allocation according to needs. The UNICEF thematic fund for humanitarian assistance, IRA at WFP, SFERA at the FAO, etc.
ECHO acts like one giant needs based fund, with good management practices, oversight and quality control.
There are country level pooled funds and Emergency Response funds.

Apart from funding “needs based”instruments a donor will have to keep some hands on presence in crises that are perceived as important: human solidarity must be done and must be seen to be done. This should not obscure that working through insurance-like mechanisms is far superior when talking about efficiency and effectiveness.

However, there is little political gain in funding these instruments: when the list comes out of donor support for disaster relief, the budget will be spent, and there are no more funds available for bringing your country in the spotlight. Responsible donors and agencies manage however to keep up this kind of funding.

One fund or interlocking systems ?
Politically, the creation of one big fund seems interesting. . It would simplify the message and management for the donors. One check every year. However, in order to have an innovative, learning system, with enough redundancy to pick up the slag when one actor fails, a further development based on interlocking and sometimes competing mechanisms seems indicated.

Insurances need assurances: blank checks or value for money?
However, there is one issue with these instruments: most of them start from the hypothesis that all actors in humanitarian assistance deliver quality and value for money. Comparative evaluations and competitive bidding on value for money are rare. Most attention goes to effectiveness, not to efficiency within a certain quality standard for effectiveness. The instruments for creating instruments for assurance on value for money exist however: there are standards for service delivery and accountability, that could be used for diving prices down and quality delivery up.

These assurances will be the cornerstone towards an insurance-like system

Including preparedness and prevention
Like every insurance, there should be in-build incentives for preparedness and prevention spending, as one of the most efficient humanitarian approaches.

Pushing Good Humanitarian Donorship
The gatekeepers for information should brainwash the politicians and the general public by highlighting the positive contribution of flexible accountable and needs based instruments. The current practices by the main humanitarian actors are more geared towards monetising sudden onset crises, hoping it sticks into the general budget. This should be an active approach, worth a significant portion of the budget.

Some possibilities are obvious:
Ocha should, for every crisis, mention first the contributors to CERF; the same could be requested from ICRC for core and IFRC for DREF. There should be an effort also by teh EU to highlight the importance of flexible funding above ad hoc funding.
Pressure should be as little as possible on “additional funding” the pressure should be to increase the budget for needs based funds. Even pressure for flexible funding to agencies does not have the necessary flexibility to respond exactly to the needs.
The overall budget should be used in rankings. This is why GHA is so important. Rankings per crisis are important, but should be presented always with overall rankings.
To move to an insurance thinking, contributions could be presented preferably as a part of the GNP or per capita, instead of on an absolute basis.

What matters for increasing the humanitarian budget?
An increase in the humanitarian donor budget will not be directly caused by an increase in humanitarian needs. It will depend in the first place on the importance a donor country gives to humanitarian assistance in general. It will be based on the conviction that Humanitarian assistance is a right. It will depend on conviction of the politicians and the general public that assistance should be given more, and that the money is well spend.

This means that the moral case for assistance must be promoted until it becomes a consensus, first in each country, second globally.

It also means that vetting humanitarian partners is necessary. An insurance type of coverage is only possible with decent standards. Standards for service delivery, accountability and evaluation make it possible to compare the operations of the different actors, Multilaterals and INGOs. It does not mean that data or evaluations will convince anybody, it means that those advocating the moral case can do so from the high ground, knowing the tax payers’ money will be well spent.

The biggest enemy for this approach could be the NGO, or multilateral that can make a killing with ad hoc funding.

The Black Rabbit and Permaculture

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I have been very quiet on my blog lately, as I was totally absorbed by my garden. It is the first time in many years I am living in a home with a real garden where I can grow my produce and I enjoy every minute of it. As I vaguely remember being an agricultural engineer, with some solid experience with small-scale farming systems in Latin America and Africa, I was excited to get on with it. although I must admit that there has been a lot of sowing and growing, but not yet a bountiful harvest.Apparently, the thinking in agriculture from those traditional smallholders has seeped into me. Central is the quest for maximize the use of available resources (land, harvest residue, water) instead of just keeping them organised. .As leeks will be far apart for most of their growing season, why not growing radish, cress or even carrots in between them? Can I diminish the evaporation from the beans by growing a row of corn around them? Mulching with lawn clippings or with wood chippings? What about damage of blackbirds, snails, slugs, Cabbage whites?
Why should I grow dwarf beans when I can have beanstalks? I am also trying just to accept my loss when plague strikes, and apply some tricks to save water. The limits of my environment show starkly, and I should get some pesticides or fertilizer if I want to get really impressive results. But why should I.  I enjoy the constant experimentation, without a trace of RCT.Just now I learned that there seems to be a movement applying these central-African approaches: permaculture.

However, this kind of thinking doesn’t go down well in my more traditionally minded environment. My chaotic patches of multiple-layered inter-cropping systems are just not done. Uniform plots wit mono-cultures and straight lines are the rule.

On top of this new obsession with gardening, I started to sport again, as my tendonitis finally abated. No marathons for me any more, but I am building up to do some “sprint triathlons”. OK, that is only one eighth. This morning I was biking on a lonely bike-path along the canal, when I was surprised to see the rabbits lost all their fear for cyclists. It was there I saw the Black Rabbit. Just one black rabbit among its grey brothers and sisters. It might be the one who got away. Perhaps the group has lost the “wild”factor through interbreeding with tame animals. I wonder what will happen when the hunting season arrives. Although, I guess humans don’t hunt from bicycles.

Robin Hood Tax: I voted for it before I voted against it.

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I am in favour of a financial transaction tax, because we can.

Indeed, we all know nothing is sure except for death and taxes, so I honestly think that if financial transactions can be taxed, we should at least try.

For the moment, labour is heavily taxed, while we surely want more work. Consumption is heavily taxed, while most people like to consume, and according to classical economic theory, consumption is a good thing. This is why we are always looking for things to tax, to lift the burden, mostly from labour. If we tax financial transactions, how much can we rake in for financing the global or national commons, before the tax will affect negatively the economy? Or would there be an ideal level, where up to a certain point, taxing financial transactions diminishes volatility while not affecting liquidity to a degree it damages the economy? Most articles and blogs I read seem to argue that financial transactions can be taxed, and up to a certain point, the total effect of taxing these transactions would even be positive, like taxing gambling, leading to less negative externalities. So I definitely think we should tax financial transactions, but we should be cautious and have good feedback systems in place, so we can raise the level until the optimal utility for society is obtained.

What should we use this tax for? This tax should be used to finance the budget of the government that raises the tax. It should be diluted in the total budget, because it is necessary to limit the pressure to raise this tax to a level that is defined not by the carrying capacity of the financial system, but because of the funding needs of one department or sector. We could consider the tax can finance the national government or global governance.

This tax cannot be seen under the same rules as pollution: “the polluter pays” means you pay to redress damages. Most financial transactions don’t do any damages (remittances, foreign direct investment, etc.), while some speculative transactions can do damages or at least don’t bring much added value to the overall economy.

So using the financial transaction tax to diminish the overall tax burden is a good policy, up to a level probably with less externalities than taxes on labour or consumption.

But what if we allocate the financial transaction tax to climate change adaptation or development? The group setting the tax level would be the environmental lobby, craving for income, balanced by the financial sector wanting to limit this transfer. I would be surprised if the result of this power struggle would deliver optimal results for the environment or the financial sector.

The environment and development should be financed as much as needed and affordable; while the financial transaction tax should be as high as useful to maximise its benefits. The two should not be directly linked.

A few more links on Robin Hood:

The Fragmentation of Humanitarian Aid: Market failure leads to planning and broken networks.

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Is Fragmentation a solution or a problem?
One of the main reasons the donor community pushes for reform in the humanitarian aid sector is the fragmentation of the services. As an antidote for fragmentation, coordination is proposed. The conventional narrative says that small interventions and fragmented approaches are inefficient. If this is the case, a market approach to the allocation of funds, where efficiency is rewarded, would create incentives to consolidate, as it would be more efficient to have less actors. Currently the system seems to fragment even further, even while high level declarations are signed to vowing to stop the fragmented service delivery.Making the system work as a market, with incentives to make it more responsive to efficiency gains would improving the results of the system as a whole. Self regulating systems of incentives normally work better for complex systems than crude top down regulation by decree.

In this blog I will try to determine whether the current humanitarian system can be defined as a market geared towards better results, and identify possible incentives to make it respond better.

Competitive markets and market concentration

A normal market has a few market leaders and a long tail. The redundancy of the market (more providers providing the same service) is not seen as a problem, but as an assurance for getting best value for money. The long tail is for practical purposes irrelevant, but it guarantees that special niches can be covered, and the big actors are kept on their toes, because the small firms could always challenge them if they manage to innovate or produce better.

An example of such a market is the one for PCs: The top 4 manufacturers produce 60 % of the PCs, the 6th a meagre 5.3 %, and all the thousands of others combined master 1/3rd of the market.

Computers are of a decent quality, and there is innovation leading to better, and cheaper computers.

Table 1
Preliminary Worldwide PC Vendor Unit Shipment Estimates for 3Q10 (Units)

Company 3Q10 Shipments 3Q10 Market Share (%) 3Q09 Shipments 3Q09 Market Share (%) 3Q09-3Q10 Growth (%)
HP 15,431,749 17.5 15,513,420 18.9 -0.5
Acer 11,527,716 13.1 11,726,586 14.3 -1.7
Dell 10,816,474 12.2 9,908,099 12.1 9.2
Lenovo 9,140,778 10.4 6,871,379 8.4 33.0
Asus 4,793,186 5.4 3,911,263 4.8 22.5
Toshiba 4,695,600 5.3 4,014,945 4.9 17.0
Others 31,896,091 36.1 30,106,333 36.7 5.9
Total 88,301,595 100.0 82,052,026 100.0 7.6

Note: Data includes desk-based PCs and mobile PCs.
Source: Gartner (October 2010)

However, fragmentation in the development world seems not to deliver this kind of expected results. Why?

The humanitarian market: perceptions of fragmentation and of competition
Looking at Humanitarian Assistance funding , which is (imperfectly) documented through the FTS system managed by OCHA, we find for 2010 a total funding of USD 7 billion.

Appealing Organisation Funding 2010 (million USD) % of total funding
All others (636 organisations) 1.507 22 %
WHO 127 2 %
UNRWA 163 2 %
IOM 219 3 %
FAO 229 3 %
UNHCR 574 8 %
UNICEF 740 11 %
WFP 3.403 49 %
Total 6,963

 100 %

Data: FTS, Summary of requirements and contributions – per Appealing Organisation in 2010, dd. 9/02/2011. Note: the data don’t show all the contributions to MSF nor ICRC, 2 important actors in the field. It is possible that some NGO-funding is not reported through FTS, however, at least donor government contributions are well reported, as donors want all their contributions to show for international forums.

On first sight, this distribution looks wrongly like a normal market, with some market leaders and a long tail. There would be some risks for monopoly abuse by WF. The top 7 organisations deliver 78 % of the assistance. The Herfindahl-Index (HHI) is 26.2, which hints to an extremely concentrated market. The PC-market has only a HHI of about 8.

  • A HHI index below 10 % indicates a highly competitive index.
  • A HHI index between 10 to 18 % (or 1,000 to 1,800) indicates moderate concentration.
  • A HHI index above 18 % indicates high concentration

On closer inspection however, the humanitarian system is not one market at all.

Indeed, WFP is dealing only with food security and logistics. UNICEF with water and Children, UNHCR with refugee camps. The next organisation dealing with food security (as only one of its activities) would be Oxfam UK recieving only 0.8 % of the total contributions. Less than 1/50th of WFP. The top 7 organisations are all UN-entities focusing on a UN-given mandate, in theory not competing with each other. For execution those UN-entities rely partly on the other actors at the bottom of the pile.

Fragmentation within the sector: on what basis are NGOs selected by donors?
Humanitarian aid is organised per sector, with a UN-agency (sometimes assisted by an NGO) as “cluster lead”. The cluster lead has “only” the power of its mandate, its financial means and capacity.

Within the main sectors dominated by the UN-agencies, there is little fragmentation. There is domination by the big players and not enough competition to have a real market. The humanitarian field the cluster leads, such as UNICEF, WFP and UNHCR, receive five to ten times the amount of funding of the main NGOs competing in the same field. In the food sector this phenomenon is the most striking, with 3/4 of the funding through WFP, and an extremely concentrated market with an HHI of 70. In the Water and Sanitation sector were actors in essence do the same job, there were 162 actors in 2010 (data of 09/02/2011), the cluster lead, UNICEF, gets 39% of the resources, followed on a distance by Oxfam GB (6.7%), Solidarités (2.9 %). This leads to a HHI of 16.4, still highly concentrated.

However, the cluster cannot be seen as one market: The UN-agencies get often their funding through core resources or separate funds. This means we should split the data in 2: The UN-agencies are a separate market from “the others”.
When excluding UNICEF from this health sector analysis, the HHI drops to an unheard of 2.98. This means the market is splintered. This is a sign of little return to size. The market does not reward any possible economies of scale. For the other sectors (health, protection, shelter, coordination) the relative weight of the UN-cluster lead is lower, but the NGO-field is as fragmented.

More analysis is needed to explain this phenomenon, as it is evident that there are economies of scale in the sector, but apparently they are not rewarded by the market.

Looking at the water-data per donor, the level where the market operates seems to be the donor level. For most donors, 4 sets of partners can be identified:

  1. the UN-agencies and the Red cross
  2. Some international NGOs probably with a local presence in the donor country.
  3. Donor country specific NGOs
  4. Possibly, some crisis specific NGOs.

Each donor has its own specific funding pattern. Sometimes there is a high weight of UN-agencies and i-NGOs, sometimes the sectors with most needs prevail, more often than not, at least part of the money is spread over donor country NGOs.

The water market for NGOs apparently is not a single market, but a set of unrelated markets per donor and per set of partners.

This means that the market push towards more quality and efficiency work only within the small donor specific markets. However, at this level, the “partnership” approach could lead to an approach where the allocation is rather spread on basis of negotiation than on selection. The market model would be a cartel.

The role of the UN-cluster leads
From the data, it seems that the NGO-funding and the UN must be considered as separate markets, even with different funding sources. Indeed, there is little evidence that the donors in general (except perhaps for some exceptions, like the CRF, or ECHO) have the wherewithal to allocate funds on basis of quality and results alone.

One hypothesis that the donor governments de facto consider the services delivered by the main UN-entities as a “utility”, a service that is part of “global governance”, a near natural monopoly. The reasons why they continue to fund the small fry are unclear from the data. It could be that they need the visibility possibly through national NGOs for internal reasons, or they might want to keep the UN-entities on their toes by providing some competition and variety of actors. If they want to deliver competition for results, the system does not seem to reward the better organisations by letting them grow. If they want to keep variety of actors, they would strengthen the hand of the NGOs better if they did not fragment them so much.
With the overwhelming part of the funding for the crucial sectors going to the UN-cluster leads, it is notable that coördination, the elimination of overlaps and filling of gaps, is still perceived as a major problem. The impact of other players in areas dominated by the big entities should be limited at best. Especially in the “life saving”sectors.

However, it is possible that the small outfits are many times as efficient as the UN-entities, showing an impact that is way more important than their share of the funding. It might also be possible that there is a perceived lack of coördination, as the visibility of the small NGOs tends to be bigger than the visibility per unit of funding of the juggernauts.

The selection of NGOs by the donors
A visit to the website of ECHO (the Humanitarian Office of the European Commission) on their partnerships is revealing. On the 8th of February 2011, ECHO worked with 191 partners. On first sight, this looks like a crowded field. However, looking per member state, there are only on average 7 partners per member state. The UK alone fields some 40 NGOs, but most member states have only a few ECHO-accredited NGOs.
Within the NGO-group a hopeful tendency shows up: Most national NGOs are local branches of international outfits, with a good reputation and internal quality control systems. This means that the perceived field fragmentation might be partly a ploy from the NGOs to deliver their quality work as one, while authorizing the individual donors to shine. They “game” the system by obtaining funds thanks to their national identity and results through their global organisation.

We conclude from the FTS data that the donors don’t base their selection procedures for NGOs only on the GHD indicators (needs based, capacity of executing agency, effectiveness), but add to it, sometimes even as a prerequisite, the nationality of the provider. Different choices of partners could be acceptable if each donor would focus on a different market: a sub-sector where it takes on its responsibility in the framework of division of labour. This seems not to be the case: donor nationality is not a result area in humanitarian assistance.

The fragmentation per nationality is a concern for the quality of the humanitarian assistance. Donors don’t play their role in the oversight of the funding, as they observe only a narrow slice of the market. If the prerequisite for the allocation of resources is the geographic location of the branch in the north, the importance of other parameters, such as services to the beneficiaries, quality, transparency and efficiency goes down.

The pressure for consolidation in order to get to optimum scale is stopped in favour of the pressure to stay fragmented to maximize national donor resources. Maintaining the status quo on the division of funding is an act of survival for the individual splinters: people can lose their job. In this environment a small NGO will rather seek rents and single sourced funding rather than risk its own survival by moving to a more competitive global environment. Results focus is not in the interest of most of the NGO-players in the sector.

When donors reserve 20 % to the NGO-sector, but every donor finances a different set of NGOs, while they finance the same group of UN-entities, Red cross and MSF, the NGO-sector will be too fragmented to play a relevant political role as it is difficult to project power as a splintered group.

The way forward
To improve the humanitarian results for the beneficiaries, the problem area is the NGO-sector.
The selection of NGOs should be aimed at the general principles for government spending: best value for money and transparency through competition. Selection should be rigorous on basis of criteria that are relevant for the beneficiaries. The market for NGOs must be widened, preferably to the global level, to make it possible for NGOs to reap economies of scale. The needs for national “visibility” could be addressed through the active promotion of national chapters of international NGOs. Such a system would not eliminate small, effective or specialized NGOs, but would lead to more consolidation where this would lead to more efficiency.

Some possible action points:

  • Assure that the funding to NGOs is based on criteria of efficiency, quality and value for money.
    1. Make projects, reports, data, evaluations comparable across donors by using standard forms and data.
    2. Consider support to national NGOs without competition from iNGOs as tied aid for OCDE/DAC
    3. Fund only interventions  you can actually monitor as a donor. with a minimal size, and leave it to flexible funds, or strong actors to fill the gaps. (Correction: some small interventions by niche specialists are crucial. I would not want to cause them to lose funding).
  • Abandon direct funding to NGOs by donor governments, and fund them only through needs based allocation systems, such as thematic funds, CERF or ERF.

In the short term, dealing with the UN-system seems to need rather an evolutionary approach than a revolutionary approach. In the long run, if NGOs become more competitive, the system will have to be reformed completely.

Possible ways forward for UN-funding :

  1. Accept the role of the UN-entities as humanitarian utilities and regulate them as such. Allocate them the near monopoly they already enjoy now, but assure the drive for more efficiency by e.g. a outcome and impact evaluation, outsourcing functions for more results at a lower cost.
  2. Separate the UN-monopoly from their operations outside of their UN-monopoly; fund the monopoly as an utility, and open the rest to global competition with the NGOs.
  3. Introduce competition on basis of quality and efficiency of the organisations. This should lead to a more diverse market, with less monopoly power of the UN-entities. Levers for maintaining coördination should be build in this system.
  4. Continue the same system, with a near monopoly of the cluster lead and limited direct funding to NGOs, but assure that the choice of the NGOs is based on criteria of efficiency and quality. This would lead to more innovation while keeping a good overall coördination through the UN.

In general, when funding a specific crisis, the best results for the beneficiaries should be obtained by considering the 4 sets of partners as one market. In the light of the limited donor capacity in most countries, it can be argued that the direct funding of local partners is not feasible for each donor.

Conclusion : the collapse of complex systems
The organisation of humanitarian assistance is for the moment not based on a global market. the market is fragmented on the donor level and per set of partners: UN-system, national NGOs, International NGOs, crisis specific partners.

Within sectors calls for better regulation and a recognition of the role of the UN-entity as a “utility”delivering humanitarian assistance.

The funding of NGOs is problematic. There is a place for a competent NGO-sector, but the donor incentives create a lot of dead wood in this sector. The current system stands in the way of an evolution towards better learning, quality and efficiency. It is the funding by the donors, that leads to the current fragmentation in NGO-resources. The donors will have to reassess their funding model completely to work towards more efficiency and better results instead of against it. Otherwise the fragmentation of the NGO-sector can only increase, while the efficiency of the NGO-sector will diminish. The legitimacy of humanitarian aid itself will be under fire. Funding outside the UN-coordinated system, for ICRC and MSF as a more accountable option, could counterbalance this trend.

In order to move away from the current equilibrium, Donors should select their partners on basis of their results and not on basis of their nationality. They should be able to compare different actors with the same yardstick. A first step would be to introduce a level playing field for accepting, assessing, monitoring and evaluating interventions.

Sunday paper

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The Sunday paper

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Development policy and evolution: does the donor public request impact or action?

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Owen posted a very good presentation on evolution and development on his blog. Indeed, evolution, like the market, is an efficient way to find solutions to complex problems or to optimize resource allocation.

The subsequent discussion on his blog raised a few issues I would like to expand on, in addition to what I wrote before on evolution in development.

  • The evolutionary pressure is being steered by the public perception. Public perception evolves too. However, I do think this pressure is for the moment rather away from long-term results and towards short-term visible activity. Sorry.
  • Evolution works with selection of the fittest, not by coordinating, clustering and evolving the un-fit. The inclusive narrative for better aid might have to make room for an exclusive selection process. (see also “what don’t make sense in trade don’t make sense in aid”).
  • The path dependency of evolution can easily lead to sub-optimal results.
  • Every evolutionary process creates dinosaurs: creatures fit for the world of yesteryear. Who is your favorite development dinosaur?

This  entry is on public support for development results.

Is the public interested in results? I would not think so: for the donor public the perception of activity is more important than results. Indeed, it is easier to look professional than to be professional. If the donor public doesn’t experience the quality of the services you deliver, it is not economical at all to invest in real expertise and real results when you can invest in faking expertise and fake results. Most NGOs manage to look trustworthy enough to part people from their money. Not all of them are sufficiently accountable.

When disaster struck in Haiti on January the 12th 2010, it took less than 24 hours for donor countries to decide to send their rapid response teams to Haiti for search and rescue. This led to major congestion at the airport, and some spectacular saves by white knights in shining armour that were documented live on television. There were more than 222.000 death and 211 lives were saved by the international and national search and rescue teams. This would be 1 per thousand. There are no data available to me about people saved by their neighbours, as the efforts of Haitians were very much underreported on during this crisis. Would Haiti have been better off it they used the airspace for bringing in shelter, food, water?

In November 2010 a cholera epidemic struck, making more than 1000 victims, while there was clearly no adequate health services or humanitarian workers around. Oh yes, this one struck in West Africa, after the flooding there. The epidemic in Haiti, at the same time, with a few hundred victims got international coverage and full assistance of the international community.

“The public is genuinely moved by the suffering and wants to support poverty reduction” writes Owen in his post. However, as they don’t experience the services for poverty reduction , they are tending to ask for the second best: visible action. In this context, as the situation is still catastrophic, after years of aid, the current “professionals” are clearly not up to the job. Support for hands on volunteers or stars is a normal way out. As is the loathing of the aid establishment. While serious evaluations of the Haiti humanitarian intervention are rather positive (for a once in decades type of event), the public perception is negative. The concern of the public that the money is lining the pockets of agencies and governments, is a valid concern, but also a typical populist issue. In domestic politics this concern is seldom alleviated by information on audits or results. You don’t establish long-term trust with the public on basis of bureaucratic requirements, but on basis of  a long-term open communication strategy, or on basis of a charismatic communicator.

A logical response to the search for public approval is to deliver activity: approve more projects, do more field visits as a minister, or create high level events,  where the stars and politicians from all stripes come together to vow action. This is exactly what is often seen as the problem with Aid. In this context, the plans themselves decided on at the high level events are not relevant, as nobody will wait for the results on the hot topic of today anyway. Activity is also about moving on to the next big thing.

While populism on domestic issues runs sooner or later into the reality of undelivered services, this feedback loop is nonexistent in development, as the taxpayer pays for services for people far away.

If I am right about the political economy of the incentives for a short-term or top down approach, than the development community must start changing some parameters of the equation in order to work towards impact instead of the perception of activity. Change the environment to create evolutionary pressure in the other direction.

However the current reality is not as bleak as we could expect, so some things must be happening that work in favour of the support for a long-term impact geared approach.

The different actors are no blind victims to the incentives before them. Apparently, a lot of them are moral actors. Elected politicians can inform themselves and translate the short-term populist concern in a long-term commitment for results. The same is true about the activist journalists and stars with a long-term commitment, e.g. as UN-agency Ambassadors.

Like piloted by some of the more successful NGOs or agencies, there is a need for a professional outreach to the public. It seems to me that only approaches with this kind of outreach might have a long-term survival chance in the political arena. Even policies that are hugely successful, if they don’t communicate well, might be doomed.
This outreach should put the ad hoc issues and in a wider context. The approach of UNICEF or MSF comes to mind as successful to put a broad results based vision on the agenda. Meanwhile the donor governments seem to be hugely inefficient in explaining their policies to the wider public. The whole Paris agenda seems to be mostly ignored by the public, what seems to be a bad basis for long-term planning.

Ethical eating in a diverse world; the taboo: to define identity by exclusion (part 4 of a series)

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There might be as many taboos as people

A taboo food is a food from which people abstain for cultural or religious reasons. As the common meal is an important way to share common humanity, the food taboo is an important way to separate “us” from “them”. While the laws of hospitality join everybody around the table, the food taboos strengthen the inner circle by excluding the other. Strict adherence to food taboos makes reciprocal hospitality impossible.
Cannibalism might be the oldest taboo. It seems  that cannibalism was practiced by different groups at one stage, although direct testimonies are rare. It was mostly something told about “those people over there”. Now cannibalism is taboo in most cultures. This might be originally a health prescription and not a real taboo: diseases transmit easily by eating flesh of deceased specimen of your own species, with Creutzfeld-Jacob as a grueling example. Slaughtering healthy humans for their flesh doesn’t make you a lot of friends neither in an environment where life is nasty, brutish and short.
Taken together as a group, the religious taboos are mainly proclaimed for their power to exclude “the other”, the unfaithful. Indeed, the essence of a religious taboo is the confirmation of prejudices and often apparent illogical rule. Humans should not question the divine law. Afterwards, people weak in their faith,seek a post facto rationalization, although second guessing a Divine order is always risky. The sometimes quoted health reasons for religious taboos suffer from confirmation bias: most foods have positive and negative effects on health. Looking for an explanation for the taboo only the negative is highlighted. Indeed pigs can be carriers of illness, but in most era’s of human history the health benefits of having a decent meal with (fried) bacon were higher than the risks carried by contagious pigs.
For the nomadic early Arabs and Jews it was easy to forgo pork: hogs, due to their physiology, need water and don’t support traveling. It was the domestic animal of the sedentary farmer and the city dweller: them, not us. Moreover, there is good reason to accept that the taboo was “cast in stone” in a period of increasing water shortages in the region. Some go as far as stating that Islam has been spread mostly into regions where pigs don’t thrive anyway. Meanwhile in regions where Islam and pigs thrive, a more tolerant form of Islam with small scale pig farming is often practiced. The animal of the arabic peninsula, the goat, is meanwhile instrumental in deforestation, desertification, and making the ecology more hostile to pigs and agriculture, more prone to nomadism.
Another well known religious taboo is the vegetarianism practiced by Jain, linked to an ethical choice for non-violence. The taboo on beef-eating in Hinduism could also be explained by environmental factors: Cattle is too precious providing milk and power, to have it slaughtered for meat. In traditional agriculture, the surplus of calves for slaughter is limited. In Hindu and Jain vegetarians do eat other animal products, such as milk. Non-religious Vegetarianism and its modern pendant, veganism are discussed later.
Some cultures extend the cannibalism taboo to “friendly” species. In the Anglo-Saxons don’t eat companion animals like horses and dogs while they savor drought oxen  without impunity. This has nothing to do with flavor or nutritional aspects, it is an ethical judgment. Frogs are too prince-like to eat for the English, while the French eat them without regret.
A special form of cultural taboo are the fake health recommendations: suddenly a food gets labeled with a health risk, with little or no scientific basis. Before you know, it is conventional knowledge. A kind of nutritionist political correctness. Examples abound: carbs, fat, etc. I mention these taboos here, as they are part of a sub-culture and not really health concerns.
Some people stop eating a certain animal or plant because of the risk for extinction or the damage to the environment caused by the culture. Notorious examples are the eating of turtle eggs, eating whale meat, or the consumption of soybean or maize grown under over-fertilized monoculture. These are not really taboos, as the reason for not eating is ethical and not cultural nor religious,.

The ethics of taboos

For ethical purposes, four main groups of taboos can be identified:
  1. Private taboos, which are kept in the home. E.g. some subcultures have a taboo against soft drinks, but when they organize birthday parties or eat out the taboo is not community  enforced. This kind of taboo is ethically neutral, as it clearly considers the importance of community acceptance higher than the enforcement of the taboo. A lot of people abide in this way to religious taboos too.
  2. House rules are linked to the family: the taboo is not enforced when going out in the community, while it is expected from the others to abide with the house rules when visiting the home. This kind of taboo is coherent with the laws of hospitality. It accepts diversity, and forces everybody to face the diversity (when in Rome, do as Romans do).
  3. Missionary taboos impose themselves on the environment. The aim of the taboo is to separate oneself from the community or to proselytise the  community change its ways. The missionary taboo demands respect, but it is not respectful itself. Most strictly enforced religious taboos fall in this category. The taboo is seen as an absolute value, higher than the other values in the community. Worse: the community is defined as those accepting and following the taboo.
  4. Personal taboos: while the individual always abides with the taboo, no behavior change from the community is asked. An example can be the consumption of alcohol.

At what point do bad manners turn  into unethical behavior?

Private taboos and house rules pose in general little ethical problems, as long as the taboo does not lead to child malnutrition, health costs for the community, or degrades to a form of psychological child abuse.

Some religious leaders have taken a strong stance against missionary food taboos: “It is not what enters into the mouth that defiles the man, but what proceeds out of the mouth, this defiles the man (Mathew 15:11).” Indeed, the general effect of a missionary food taboo is its divisive impact. It separates us from them, and attaches a moral superiority to the followers of the taboo. The taboo goes nuclear on the shared meal, bringing division at our table. Moreover the taboo diminishes freedom of choice and food diversity for an individual. By limiting the access to diversity it is limiting the development of a person to its full humanity. Due to these negative properties, the balancing positive properties of a particular taboo must be very convincing in order to be acceptable.

In a modern ethos most religious taboos are difficult to defend as a missionary taboo for their limited advantages to mankind, and the divisiveness they bring. As they have scant rational basis, their enforcement on the community as a missionary taboo is at least a show of bad taste.

Refusing to eat some food because of the negative impact on the environment is on a stronger ethical foundation. It is however, not really a taboo, as the reason for not eating it nor cultural nor religious. However, the scientific basis for these choices is often shaky. Some of these taboos are just a sign of black and white thinking or environmental myths, without attention for the nuances of reality. In this case, they are food taboos as they are a sign of adherence to a sub-culture an not a science-based ethical choice.

This aspect will be addressed in the part on farming systems. When is an environmental effect so important it should be law, when should it be “the right thing to do” and when is it just individual lifestyle choice?  When is this taboo just not important enough to go nuclear on our shared meal? What is the effect on the environment of eating meat just only once at the shared table, compared to the use of a car? In the chapter on veganism some of these elements will be further explored.

The taboos against eating animals emotionally close to us seems to have little objective ground, but the attitude of respect it shows for companions is important.

By Sam Gardner