Ethical Performance
inside intelligence for responsible business


Pakistan relief comes up short

October 2010

Businesses have donated significantly less to the Pakistan flood relief effort than to other recent natural disasters, and have seen their contributions dwarfed by individuals and governments.

The international business community played a major role in the response to the Haiti earthquake relief effort, but its donations in cash and kind in relation to the Pakistan flooding have shown a relatively significant decline.

The US Chamber of Commerce, which has been co-ordinating the American corporate response to the floods, says Pakistan has become the third-largest recipient of disaster assistance from the business community in the past five years, behind Haiti and China. But the level of US ‘corporate-driven aid’ is well below that of the Haiti effort, especially in relation to the impact of each disaster.

The Chamber’s figures show that $10million (£6.5m, €7.8m) has been raised by US business, compared with $150m for Haiti, where the number of people displaced was about a sixth of the figure in Pakistan. Around 3.5 million children are at risk of contracting deadly waterborne diseases as a result of the floods.

Pharmaceuticals companies have been the most generous US business respondents to the disaster. Abbot, Bayer and GlaxoSmithKline have all made relatively large donations, mainly in medicines.

Other major multinational donors of cash and services include UPS, Abbott, Bank of America, Toyota, Cisco, GE, Kraft, General Mills, Google, Honda, Pepsico, and Motorola.

Almost $1billion has been pledged from other sources, says Pakistan’s foreign minister, dwarfing direct donations from the corporate world. Money has reached Pakistan from individuals and governments after an initially slow response attributed to ‘donor fatigue’ and the recession, although the figure is still less than that raised for Haiti.

In Europe, private and state aid has far outstripped corporate involvement, although many businesses have pledged help. The UK-based construction equipment company JCB, for example, has donated £160,000 ($246,000, €193,000) worth of machinery to help rebuild Pakistan’s infrastructure. However, the most that many of Europe’s largest companies have provided is a means for their customers to donate to the relief effort.

Sharan Bal of the CSR Asia consultancy said recent events suggest that companies need to think about providing an ongoing and underlying response to climate-related disasters rather than trying to make a big effort each time.

‘A world where low probability but high impact risks are increasing in both probability and impact ... requires a shift in thinking to larger-scale and long-term investments to protect areas from further potential damage, or to build disaster resilience into communities in areas that are increasingly vulnerable to climate-related disasters,’ said Bal.

‘Companies have been slow to invest in community adaptation to climate variation, in conjunction with disaster resilience building [but] there are vast opportunities for them to get involved here, especially through their community investment arms.’

US Chamber of Commerce | Asia | Charitable giving


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