In Jordan’s Zaatari refugee camp, residents can pick up groceries from a branch of the US supermarket chain Safeway, staffed by re-trained refugees. Elsewhere in the country, IKEA shoppers in the capital, Amman, can get their hands on a range of soft furnishings made by displaced people. Refugees in Greece have been issued with pre-paid Mastercard debit cards to help them with basic needs.
What the above examples have in common is that all involve multinational corporations contributing to refugee aid projects using their core business. That’s in contrast to the traditional approach; making donations of cash or other resources. A 2017 report from the Center for Global Development (CGD) identified this trend, highlighting the “social impact”, “reputational benefits” and “brand loyalty” businesses could earn.
But can big business — with its all-eclipsing profit motive — really ever be a central part of the battle to help the world’s 22.5 million refugees?
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Senior policy fellow at the CGD Cindy Huang said that businesses can bring a lot to the fight, but they have to make sure they are contributing in the most effective way possible.
“In kind” donations, for example, where an organisation might give some of its staff or other resources for free, often come with prohibitive costs for NGOs, she said. Businesses don’t always realise the amount of time or money required to deploy their donation. While straightforward monetary gifts “can be helpful”, they are “often one-off or periodic”.
Instead, in the report, Huang argued that multinational companies could best help refugees in three ways. They can bring refugee businesses into their supply chains or hire refugees, they can make products designed to meet refugees’ needs, and in the case of investment firms, they can employ “impact investing” strategies, directing capital towards businesses that take on the first two approaches.
Mastercard is one multinational that’s diverting significant energy into the issue by creating products for refugees. Sasha Kapadia, International Development Director at the credit card provider, pointed to its decision to partner with the World Food Program in 2012 as its first major foray into the “refugee space.” That program, which issued pre-paid cards for refugees to purchase food, has since helped feed more than 2 million people.
Now, the company has launched a partnership that’s more ambitious in structure: a coalition jointly led with USAID’s Power Africa energy initiative, bringing together over 20 partners from the public, private and third sectors.
The coalition will launch pilot projects in refugee settlements in Kenya and Uganda. They will tackle technological infrastructure issues within the camps that hamper development efforts — expanding access to energy or mobile phone connectivity, for example. Mastercard is positioned to play such a role, said Kapadia, partly because creating and managing complex digital systems is part of its core business.
“People think we’re a credit card company,” she said, “actually we’re a network that enables the secure and efficient transfer of funds from account to account. That requires striking lots of different partnerships and agreements.”
But Huang acknowledges that there is a “risk” of uncompetitiveness when big private companies play a significant role in tackling refugees’ problems using their own products. Some might be concerned about the long-term implications of refugees becoming customers of Mastercard, or any other business, without other options easily available — such constraints could be seen as the very definition of a captive market.
But where “crucial services” have not been provided by the public or third sectors and the private sector is willing to step in to fill an immediate need or launch a pilot project, that’s to be welcomed, Huang said. Then it’s necessary to “make sure that, after this initial pilot phase, if there’s any further scaleup that it’s done in a competitive way.”
In a world where access to many crucial services depends on the presence of the private sector, the involvement of multinationals in refugee work can bring new resources to some of the world’s most isolated people.
Financial services companies, for example, could help millions more people access banking and other financial services. More than 75% of adults in countries suffering from humanitarian crises remain excluded from the financial system, according to the Access to Finance Forum.
But as companies begin to pivot to new kinds of pro-refugee work, it’s vital that the governments who partner with them are committed to competition. Allowing one company unfettered access to the vulnerable would only fail refugees in the longer term.
(Picture Credit: UN Women)