Corporate engagement in humanitarian action: Concepts, challenges, and areas for international business research

Jasper Hotho (Copenhagen Business School, Frederiksberg, Denmark)
Verena Girschik (Copenhagen Business School, Frederiksberg, Denmark)

critical perspectives on international business

ISSN: 1742-2043

Article publication date: 6 June 2019

Issue publication date: 6 June 2019

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Abstract

Purpose

The purpose of this paper is to open up new lines of research into the engagement of corporations during humanitarian crises. The paper provides an introduction to core concepts in the delivery of humanitarian assistance, as well as a comprehensive overview of when, why, how, and to what effect corporations engage in humanitarian action.

Design/methodology/approach

Building on extant literature and policy reports, the paper synthesizes concepts and insights to map the interdisciplinary field of research on corporate engagement in humanitarian action.

Findings

The paper systematically reviews and describes different dimensions of corporate engagement for delivering humanitarian action and explains key complications that inspire new research questions. In particular, the paper highlights challenges associated with getting corporations to engage in humanitarian action; challenges associated with ensuring effective corporate engagement; and challenges associated with ensuring ethical engagement.

Originality/value

By raising new questions about corporate engagement in humanitarian action, this paper develops an original and positive research agenda for international business, management research, and related fields.

Keywords

Citation

Hotho, J. and Girschik, V. (2019), "Corporate engagement in humanitarian action: Concepts, challenges, and areas for international business research", critical perspectives on international business, Vol. 15 No. 2/3, pp. 201-218. https://doi.org/10.1108/cpoib-02-2019-0015

Publisher

:

Emerald Publishing Limited

Copyright © 2019, Jasper Hotho and Verena Girschik.

License

Published by Emerald Publishing Limited. This article is published under the Creative Commons Attribution (CC BY 4.0) licence. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this licence may be seen at http://creativecommons.org/licences/by/4.0/legalcode


1. Introduction

As large-scale crises and disasters become ever more frequent and complex (OCHA, 2017a), the delivery of humanitarian assistance increasingly depends on a growing cast of humanitarian and non-humanitarian actors. Traditionally, the actors concerned with humanitarian emergency response have been international organizations, such as the UN, and non-governmental humanitarian organizations such as the International Committee of the Red Cross. However, for reasons ranging from dwindling support for multilateralism to a marked shift in the scale and dominant loci of conflicts from inter-state level to regional and intra-state level, these traditional actors are struggling to efficiently and effectively respond to humanitarian emergencies. Therefore, there has been an increased involvement and reliance upon non-traditional actors for delivering humanitarian assistance (Sezgin and Dijkzeul, 2016), including faith-based organizations, armed groups and – crucially here – local businesses and multinational enterprises.

Although management research has explored the negative effects of crises on business and the various ways in which firms may mitigate their exposure to crises and conflict, the literature has been considerably less attentive to the multifaceted ways in which firms directly engage in the delivery of humanitarian assistance or to the questions and complications that arise from the involvement of private actors in humanitarian action. In particular, relatively less effort has been made to complement the thriving line of research on business and peace (Oetzel et al., 2009; Kolk and Lenfant, 2015), with research into the drivers, management, and outcomes of corporate involvement in the delivery of humanitarian assistance. This lack of research is especially problematic because humanitarian engagement is a reality for corporations ranging from shipping conglomerates such as A.P. Møller-Maersk to global software companies such as Microsoft. The lack of research into the humanitarian role of corporations also hampers our understanding of key questions regarding the delivery of contemporary humanitarian assistance, including the conditions under which private sector engagement enhances rather than complicates humanitarian assistance, the conditions under which humanitarian engagement produces positive returns for both firms and societies and whether the increasing trend toward private sector engagement does in fact lead to sustainable and effective humanitarian solutions.

Our aim in this paper is to stimulate interest among researchers in the field of organization and management about the role of firms in the delivery of humanitarian assistance and to encourage new lines of research around this crucial issue. The delivery of humanitarian assistance can fall on different types of firms. Most humanitarian work involves the engagement of local and regional firms that have close ties to local communities (Zyck and Kent, 2014). However, multinational enterprises are particularly valued as humanitarian partners because of their global presence, networks and resources and their experience – in many cases – of cross-sector collaborations. In fact, multinational enterprises are increasingly becoming an integrated part of the international humanitarian system. Therefore, in this paper, we place particular (though not exclusive) emphasis on aspects of corporate engagement in humanitarian action that fall within the scope of international business and management research. In particular, we focus our attention on corporate humanitarian action both as a way to broaden the international business research agenda by encouraging scholars to address an understudied phenomenon with direct business and societal relevance and as a particularly challenging or extreme research context that may serve to refine existing theories and their boundary conditions.

In Section 2, we provide a short introduction to core concepts and distinctions in the area of humanitarian assistance. In Section 3, we discuss the multifaceted relationships between business and humanitarian crises and unpack corporate engagement in humanitarian action as a vital but understudied area. The paper ends with a discussion of some of the challenges that arise when corporations assume the role of humanitarian actors in Section 4 and concludes with suggestions for new lines of research in Section 5.

2. Humanitarian crises and humanitarian action: a brief introduction to key concepts

Humanitarian crises are “singular event[s] or a series of events in a country or region that cause serious disruption to the function of a society, resulting in human, material, or environmental losses which exceed the ability of affected people to cope using their own resources” (IASC, 2015, p. 2). Humanitarian crises differ on a variety of dimensions that affect the type and extent of humanitarian assistance needed, as well as the complications that may arise in the delivery of assistance.

A first key distinction is that between man-made humanitarian crises and those that are caused by natural events. Examples of man-made events that may spark humanitarian crises include armed conflicts, communal violence and wide-scale violations of human rights. Similarly, natural events that may lead to humanitarian crises range from storms and earthquakes to landslides, droughts and tsunamis. Thus, sensitivity to the origins of a humanitarian crisis is important because man-made crises tend to be more politicized than those resulting from natural events, which in turn can complicate the delivery of humanitarian assistance in various ways. For example, those in control of a territory may be unwilling to ask for or to permit the delivery of humanitarian aid to those with whom they are in conflict. Similarly, donors may be reluctant to make humanitarian contributions to mitigate man-made crises because of the increased risk of their being seen as acting partially.

Crises also differ in the speed with which they arise. Sudden-onset events, including the majority of natural disasters, emerge or escalate quickly and can be difficult to predict, while slow-onset events emerge over a much longer time period such as the widespread famine in Somalia in 2017, which resulted from over two years of protracted drought. Sudden-onset events lead to humanitarian crises because of the intensity and unpredictability with which they occur, whereas slow-onset events escalate into crises when states and others fail to recognize or act on interrelated events as they unfold over time.

Finally, humanitarian crises differ significantly in their duration. Some disasters, such as the devastating tsunami that hit the island of Sulawesi in 2018, are acute events that last for a relatively short period of time before recovery efforts can begin. In other cases, humanitarian crises are of a protracted nature and may last for months if not years such as the ongoing humanitarian catastrophes in Syria and Yemen. While the humanitarian challenge in the case of short-term crises is to deliver assistance that is fast, efficient and effective, the additional challenge posed by protracted crises is to sustain assistance while the media, donors, and aid organizations shift their attention to other events. For example, one of the major challenges for the World Health Organization during the 2014-15 Ebola crisis in West Africa was to convince aid organizations to persist with their humanitarian efforts during the crucial “tail” of the outbreak, when the number of infected patients had tapered off but the risk of infection had not yet disappeared.

Under international human rights law, the primary responsibility for the provision of protection and assistance to those in need lies with local states (IASC, 2015). However, when a functioning state is absent, as in areas controlled by insurgents, this responsibility falls on whatever faction is in control of the area where the disruption has occurred. The capacity of states or of others in power to cope with serious disruptions is enhanced by factors such as a well-functioning state with effective formal and informal institutions, a developed infrastructure, and social stability. Another contributing factor is the level of emergency preparedness, which can enhance coordination and thereby the speed, efficiency, and effectiveness with which emergencies can be tackled. Whether events lead to a humanitarian crisis and whether states call for humanitarian assistance vary according to the response capacity of the country where the crisis has occurred. Therefore, in practice, developing countries are generally more vulnerable to humanitarian crises compared to developed countries.

However, when emergencies exceed the capacity of local states or when states or those in control of an area are unwilling to save lives and alleviate suffering, it is up to others to engage in humanitarian action. Humanitarian action comprises the provision of assistance, protection, and advocacy in response to humanitarian needs. Assistance includes meeting basic needs such as food, water, shelter, and medical care, as well as the provision of services to save lives and alleviate suffering. Examples of these services include the provision of search and rescue capacity, logistical assistance, and technical and managerial expertise. Protection consists of all efforts to protect the rights of people in conflict and disaster settings, including the provision of shelter from violence and the facilitation of equal access to basic services. Advocacy includes all attempts to raise awareness of humanitarian needs among relevant states, bodies, and the public. Emergency response preparedness may also be considered a part of humanitarian action (IASC, 2015).

Humanitarian action differs from other forms of support in that it is delivered purely on the basis of need. This notion is enshrined in the humanitarian principles of humanity, impartiality, neutrality, and independence (UN General Assembly Resolution 46/182, 1991). The principle of humanity encapsulates the humanitarian imperative to address human suffering wherever it is found. Neutrality is the principle that humanitarian actors must not take sides in hostilities, seek to influence the outcome of a conflict or engage in controversies. Impartiality is the principle that humanitarian action must be carried out on the basis of need alone, without distinctions on the basis of nationality, race, gender, religious belief, class, or political opinions. Independence is the requirement that assistance be autonomous and uninfluenced by the political, economic, military, or other objectives pursued by any actors in relation to the areas where humanitarian action is implemented. These principles not only reflect the morals of humanitarians but also enhance the effectiveness of humanitarian assistance because adherence to these principles strengthens trust in the humanitarian system. Consistent adherence to these humanitarian principles often makes it possible for humanitarians to assist even the most difficult-to-reach people. For example, in Afghanistan, the decision taken by the NGO Action Against Hunger to not accept funding from the USA for fear of being seen as partial served to facilitate the NGO’s efforts in providing aid to vulnerable communities in areas under Taliban control (ACF, 2013).

A related concept is the notion of humanitarian space, meaning physical spaces, such as refugee camps and other protected areas, where humanitarians can “work without hindrance and follow the humanitarian ethics’ principles of neutrality, impartiality, and humanity” (Spearin, 2001, p. 22). Humanitarian space also has a metaphorical dimension because it implies an area independent of politics and vested interests; however, this concept is ultimately an ideal. In practice, humanitarian action invariably takes place in arenas where a variety of actors negotiate the rules of the game and the allocation of resources, with states, warlords, and local communities, all possibly seeking to exert influence over the size and location of the humanitarian space and who does or does not have access to this space. For example, during the Syrian Civil War, the Syrian Government routinely regulated access to international aid as a means of rewarding loyalty and of weakening opposition groups (Sengupta, 2017). In addition, international aid agencies themselves often compete for humanitarian space as they seek to allocate their resources (Hilhorst and Jansen, 2010), which can lead to wastage and the hampering of local relief efforts. Indeed, concerns over the side effects of such competition have been cited as reasons for the Indonesian Government’s decision to expel unregistered foreign aid workers in the wake of the 2018 Sulawesi earthquake (Betteridge, 2018). Such examples serve to highlight the fact that although the aim of humanitarian assistance is strictly non-political, the contexts within which humanitarian action takes place are often highly politicized, complex, and fraught with ethical dilemmas.

3. Humanitarian action: the role of business

It is often assumed that humanitarian organizations and businesses operate in distinct social spheres; however, in practice, their respective activities regularly intersect in a variety of ways. To date, researchers have paid particular attention to the impact of business on the ways in which humanitarian crises arise and unfold, as well as the consequences of humanitarian crises for businesses that operate across borders. However, considerably less attention has been paid to the various ways in which firms are directly involved in and affect the delivery of humanitarian action. As shown in Figure 1, we see this as an important yet underexplored area of research for organizational and international management studies. In this section (Section 3), we first review the manifold relations between business and humanitarian crises before focusing on the motivations for firms to directly engage in humanitarian action and the various ways in which they do so. In Section 4, the challenges that arise from firms operating as humanitarian actors, as well as the scope these challenges create for new lines of international business research, are discussed.

3.1 The impact of business on humanitarian crises

As summarized in the box on “the role of business” on the left side of Figure 1, firms can affect the course of humanitarian crises in various ways. First, and most dramatically, firms may be complicit in the emergence of humanitarian crises. This may occur when business activities arouse the type of severe grievances that motivate conflict such as excessive levels of corruption, suppression, poverty, and inequality (Bennett, 2002). Examples of business practices widely recognized as potent sources of communal conflict and violence include practices that exacerbate inequality or ignite ethnonationalist sentiments such as forced displacements or foreign investments whose rents are distributed along ethnic or sectarian lines (Banfield et al., 2005; Hook and Ganguly, 2000; Stewart, 2000). Firms may also knowingly or inadvertently re-ignite or exacerbate existing conflicts through their core operations or risk management strategies. For example, in 2014, Somalia accused foreign oil exploration companies seeking to protect their local operations of “introducing armed militiamen in areas already in conflict and thereby stoking old feuds which resulted in internal displacement and harming the innocent and the most vulnerable people” (Jorgic, 2014). Finally, firms may be complicit in the emergence of humanitarian crises when their activities contribute to or exacerbate the impact of natural hazards. For example, deforestation for commercial purposes not only enhances the risk of landslides but also dramatically exacerbates the humanitarian impact of storms and floods (Bradshaw et al., 2007; OCHA, 2014).

Second, businesses may contribute to the perpetuation or aggravation of humanitarian crises. This typically occurs when firms purchase products, commodities, services, or rights of access from actors at the root of a crisis or when they pay belligerents to secure the continuation of their operations or the safety of their employees. In such instances, firms are implicated in the perpetuation of humanitarian crises because their funds enable or provide incentives for regimes or belligerents to sustain their engagement in armed conflicts and/or continue systematic violations of human rights (Collier et al., 2009; Collier et al., 2004). For example, in 2018, the Paris High Court charged the cement company Lafarge SA with complicity in crimes against humanity after the company was found to have provided the Islamic State (also known as ISIL or ISIS) with millions of dollars in exchange for oil, raw materials and safe passage in its attempts to keep its operations running during the Syrian Civil War (Alderman, 2018). Ayres (2012) describes how the international trade in coltan, a mineral used by producers of battery-powered electronic devices such as mobile phones and electric cars, facilitates the persistence of militarized ethnic conflict and atrocious levels of human rights violations in the eastern region of the Democratic Republic of Congo, including wide-scale violence, rape and dismemberment.

As reported by Haufler (2015), the international relations and political science literature tends to be critical of the role of business in advancing peace. In contrast, the business and management literature has placed greater emphasis on how firms may shape the course of humanitarian crises in positive ways. In particular, the literature on business and peace has devoted considerable efforts on identifying and understanding the positive business practices that contribute to peace and stability and the prevention of humanitarian crises (Bennett, 2002; Nelson, 2000; Oetzel et al., 2009). Nelson (2000) highlights some of the key ways that multinational enterprises can contribute to conflict prevention at various levels. At the local level, firms may seek to address the root cause(s) of conflict, such as inequality, poor governance, or ethnic tensions, through their business operations, social investment programs or support for building civic institutions. Firms can also engage in local or regional policy dialog and in high-level advocacy. In conflict-prone contexts, firms may contribute through preventive diplomacy, fact-finding missions, and mediation efforts (Bennett, 2002; Nelson, 2000). As highlighted by Oetzel et al. (2009), firms can help prevent conflict by ensuring that risk-management practices are conflict-sensitive and/or by promoting a sense of community and economic development. Indeed, Mihalache-O’Keef (2018) finds that tertiary sector investments can come with a peace dividend as they may alleviate the risk of civil conflict.

Security studies and international business research has highlighted how firms can also positively contribute to conflict resolution initiatives aimed at the remediation of crises. For example, in the pre-negotiation stage of a conflict mediation process, a firm’s networks, knowledge and financial resources may provide access to and leverage over people otherwise not accessible to a mediation team (Iff and Alluri, 2016). Businesses may also be actively included in negotiations as part of multi-actor approaches to conflict resolution (Getz and Oetzel, 2009; Oetzel et al., 2007). Finally, firms can make a crucial contribution to negotiation processes by providing “good offices,” as in the negotiations to end apartheid in South Africa (Tripathi and Gündüz, 2008). Getz and Oetzel (2009) have further shown that firms may contribute to the remediation of crises through indirect strategies aimed at addressing the root causes of conflicts such as policies aimed at downplaying ethnic divisions and encouraging participation in global multilateral agreements. The continuation of business activities in the face of conflict has been cited as a means to influence conflict positively as such persistence may provide economic incentives for de-escalation (Getz and Oetzel, 2009; Nelson, 2000).

Finally, there is increased recognition that businesses play a crucial role in the recovery of communities and societies affected by humanitarian crises. Although it can be difficult to convince firms to engage in areas during the fragile transition from war to peace (Gerson, 2001), companies are deemed highly valuable in efforts to reboot and rebuild devastated societies (OCHA, 2017b). Businesses are both vital in providing essential goods and services and employment opportunities that can give crisis-struck populations a renewed sense of purpose, perspective, and social cohesion, as well as the income they need to rebuild their communities and private lives. Firms can directly contribute to post-conflict reconstruction through investments in infrastructure and key sectors (Bennett, 2002).

3.2 The impacts of humanitarian crises on business

The section above underlines the considerable focus of political science and management research on the effects of business on humanitarian crises. The reverse relation, i.e., the impact of humanitarian crises on business, has received attention primarily within international business research and within security studies. Moreover, fields such as development studies and political economy, which largely fall outside the scope of this paper, have tended to focus on the economic and developmental impacts of crises (Carbonnier, 1998).

In line with the dominant focus of international business research, studies in the field of international business have focused primarily on the impact of violent conflicts and disasters on companies’ internationalization decisions. Such research tends to view crises in terms of risks, whether continuous risks or discontinuous episodic risks that are difficult to anticipate and predict (Oetzel and Oh, 2014). For example, studies undertaken by Oetzel and Oh have demonstrated the negative impact of violent conflicts and disasters on the number of a firm’s subsidiaries in the affected host countries and how this impact was moderated by both the quality of governance in the host country (Oh and Oetzel, 2011) and the firm’s prior experience of such events (Oetzel and Oh, 2014; Oh and Oetzel, 2017). Furthermore, they have examined the impact of terrorism and technological and natural disasters on whether multinational enterprises decide to enter a particular country (Oetzel and Oh, 2014), while Witte et al. (2017) examined the association between different types of political violence and countries’ levels of inward FDI flows. As such, crises are commonly considered to have a negative effect on the location decisions and investments of multinational enterprises.

While international business research emphasizes the negative impact of crises on firms, research in the fields of security studies and political science has long drawn attention to how some firms and sectors may seek to profit from crises and conflict. For example, security studies research has examined the process and the intended and unintended consequences of the widespread commercialization of security and the emergence of military markets. Such research has highlighted how governments extensively rely on private firms to respond to conflict-related demands ranging from the provision of health care for soldiers, the incarceration of prisoners, and the provision of intelligence services and weaponry to the tracking down of interrogation and killing of belligerents (Leander, 2010, 2011; Kinsey, 2006). Similarly, significant business opportunities may arise from supplying conflict-related services and products, such as weapons and medical supplies, to civilian belligerents and embattled communities. Less is known, however, about business opportunities arising from the re-building of societies recovering from crises. In particular, crucial questions related to how such fragile environments allow companies to exercise power and shape environments in non-democratic ways remain unanswered (Ford, 2015; Klein, 2007).

3.3 Business and humanitarian action: dimensions of engagement

In contrast with the two focal areas highlighted above, attention of the role of business in the delivery of humanitarian action has been relatively limited. This is surprising in view of the fact that the private sector commonly engages in the delivery of humanitarian assistance and disaster relief in various ways (Thomas and Fritz, 2006). Research in operations management is an exception to this blindspot as this literature has focused on the logistical challenges of private sector involvement in the delivery of humanitarian assistance (Tomasini and Van Wassenhove, 2009a, 2009b; Van Wassenhove, 2006). Here, we aim to shed light on the various ways in which companies engage in humanitarian action by addressing the role of business more comprehensively. To this end, we have outlined four dimensions on which corporate engagement in humanitarian action differs: for-profit versus non-for-profit engagement; direct versus indirect engagement; independent versus collaborative engagement; and voluntary versus involuntary engagement (Table I).

An initial distinction is between corporate engagement in humanitarian action for for-profit and non-for-profit motives. Humanitarian action offers lucrative business opportunities beyond those already known to be available for private security companies (Spearin, 2001). Other salient business opportunities pertain to the provision of health, shelter, nutrition, food security, logistics, water, sanitation and hygiene, telecommunications, cash transfers, and mobile money, as well as administrative tasks and consultancy on operational issues. Many NGOs choose to sub-contract the provision of goods, services, and work to tap into specific expertise and capacities, divest themselves of risks, and save costs by not having to develop solutions themselves (Lucchi, 2018). This outsourcing of work by NGOs has changed the landscape of humanitarian action by increasing the space for for-profit corporate engagement in humanitarian operations, prompting the emergence of companies that build their business models around humanitarian action such as specialized development companies or healthcare and education contractors. This trend has also given rise to institutionalized solutions such as the procurement platform developed by the UN Office for Project Services, on which various business opportunities are announced, such as the demand for vehicles, camp management services, or drilling for water wells. Thus, for-profit engagement has become an integral part of humanitarian action.

Notwithstanding these for-profit business opportunities, many companies engage in humanitarian action for various non-profit motives. First and foremost among these motives are philanthropic motives. In most cases, non-for-profit corporate engagement is at least partially driven by a sense of moral and ethical responsibility, as well as the desire of firms, managers, and their employees to contribute to the alleviation of human suffering in their direct community or beyond. In practice, however, corporate engagement is often driven by other motives too. While not directly for-profit, companies also engage in humanitarian initiatives in anticipation of long-term benefits. A recent survey of private sector firms uncovered four main instrumental rationales for engagement (OCHA, 2017b), as summarized below.

First, companies may see engagement as providing commercial opportunities in the medium to long-term because participation in humanitarian relief efforts may facilitate access to new markets and enable firms to familiarize themselves with new contexts. For example, MasterCard’s humanitarian partnerships allow the firm to develop an understanding of untapped markets in countries that are currently in crisis – as in Yemen – but which may prove attractive in the future (OCHA, 2017b). Humanitarian engagement may also provide opportunities to develop and attempt new products and services that can be marketed elsewhere. For example, during the Ebola outbreak in West Africa in 2014-16, the decision of Mapp Biopharmaceutical to donate its entire supply of its experimental Ebola drug ZMapp helped save lives while also affording the firm a chance to try its drug on human patients (Mullard, 2014).

Second, companies may seek out opportunities to engage with humanitarian initiatives with a view to the possible reputational and motivational benefits such actions may accrue. In addition to perceiving humanitarian engagement as a means of enhancing their legitimacy and reputation in the eyes of secondary stakeholders, including governments, consumers, and local communities, companies may see humanitarian engagement as providing a way to support, engage, and possibly retain employees and strengthen internal perceptions of the firm. For example, during the Ebola outbreak in West Africa, the medical and travel security assistance company, International SOS, developed and distributed a range of educational materials for public use (Lai and Simpson, 2016). This initiative made it possible for the company’s employees to leverage their expertise in public health to make a meaningful contribution to public and private efforts to combat the viral outbreak.

Companies may also view humanitarian engagement as a means of reducing business risks and mitigating losses (OCHA, 2017b). An example of this is the Ebola Private Sector Mobilisation Group (EPSMG), a coalition of companies in countries affected by the 2014-16 Ebola outbreak in West Africa. The signatories to the EPSMG, which originated as a platform for mining companies, were openly committed to preserving and continuing their operations in West Africa. In addition to providing support for humanitarian agencies combatting Ebola, the EPSMG sought to prevent interruptions in the market and supply-chain and to protect employees and their families at a time when local health centers were overburdened with Ebola cases.

Finally, companies engage with humanitarian initiatives to build relationships and gain influence with international organizations, governments and local communities (OCHA, 2017b). Such relations may facilitate future market entries, create opportunities for procurement contracts, or facilitate the use of non-market strategies. Thus, companies have strong business motives for not-for-profit engagement.

Not-for-profit corporate engagement need not necessarily entail participation by companies in humanitarian action on the ground. Many firms only engage indirectly by supporting the work of humanitarian actors by offering financial support, in-kind donations, or activities that otherwise boost the response capacity of humanitarian organizations in the field. Indirect engagement has traditionally been of an ad hoc nature. For example, the Danish dairy company Arla has provided milk powder to secure infant nutrition in a number of acute crises. Increasingly, however, multinational enterprises also form long-term partnerships with humanitarian actors. To illustrate, Microsoft sustains partnerships with several international NGOs for the purpose of “helping these organizations pursue their missions with secured, reliable, and trusted cloud solutions” (Microsoft.com, 2019). Such partnerships may boost humanitarian action when they involve the development of much needed technological solutions. Microsoft, for instance, has partnered with the International Committee of the Red Cross on a project aimed at improving the Committee’s capacity to reunite separated families using facial recognition technology (International Committee of the Red Cross, 2018). Notwithstanding the potential impacts of such partnerships, these forms of corporate engagement are best described as indirect because they support and strengthen the response capacity and ability of other organizations to provide assistance. Companies engaging indirectly tend to remain shielded from the political dynamics that often characterize local crisis contexts.

In contrast, direct engagement involves the active participation of companies in delivering humanitarian assistance, thereby directly contributing to the prevention or alleviation of human suffering on the ground. For example, when Hurricane Katrina caused catastrophic damage and flooding in Florida and Louisiana in 2005, the retail giant Walmart leveraged its logistical efficiency and local knowledge to distribute much-needed goods such as water, food, fuel, and toilet paper. Walmart was showered with near-universal praise for its prompt, effective, and generous engagement (Barbaro and Gillis, 2005; Horwitz, 2009). This example shows that multinational enterprises often possess resources and capabilities they can rapidly mobilize for humanitarian action. In extreme situations, multinational enterprises may occasionally work alone and coordinate with others only in an ad hoc manner to save the time and effort it takes to develop and implement collaborative partnerships. More often, however, direct engagement in humanitarian action entails partnering with humanitarian organizations or other private actors across industries to pool resources and expertise when sharing costs and risks (Thomas and Fritz, 2006) as was the case with the EPSMG during the West African Ebola crisis.

However, not all corporate engagement in humanitarian action is voluntary or can be explained in terms of profit and non-profit corporate motives; companies also take on humanitarian roles because situational conditions demand such engagement. One example of involuntary engagement is found in the role of the shipping industry during the Mediterranean migration crisis. Since 2014, well over two million migrants have tried to reach Europe by crossing the Mediterranean Sea on overcrowded boats, rafts, and inflatables. Thousands have lost their lives because of the limited rescue capacity of EU members and Libya’s descent into a failed state. The shipping industry now regularly assumes a crucial role in search and rescue operations. Bound by moral obligations and the law of the sea, merchant vessels are regularly called upon to conduct observations and engage in rescue activities and have already participated in hundreds of search and rescue missions and rescued an estimated 100,000 lives (International Chamber of Shipping, 2016). This example highlights how companies engage in humanitarian action because of normative and legal requirements or because they happen to be operating in crisis situations where other actors have failed.

4. Humanitarian action: an agenda for international business and management research

Our description of the various dimensions of corporate engagement for delivering humanitarian assistance has focused on the positive contributions of such engagement, though many challenges remain, several of which will be discussed below. We have structured our discussion around three themes: challenges associated with getting firms to engage in humanitarian action; challenges associated with ensuring effective corporate engagement; and challenges associated with ensuring ethical engagement. We then go on to discuss how management and international business research can advance insights into corporate engagement in humanitarian action and where research on corporate engagement in humanitarian action challenges the prevalent thinking in these fields.

4.1 Challenges in corporate engagement in humanitarian action

A first challenge lies in motivating firms to engage in the delivery of humanitarian assistance and in getting them to sustain their engagement throughout the different phases of a crisis. When the UN recently launched its Connecting Business Initiative platform to coordinate and build capacity for corporate involvement in humanitarian relief, it did so in response to the requests of more than 900 firms. Yet, while the launch of such initiatives suggests considerable interest in corporate engagement, this engagement may be highly conditional on the extent to which firms are able to realize measurable benefits. A recent OCHA survey suggests that over 90 per cent of firms attach considerable weight to the expected returns when deciding whether to pursue humanitarian partnerships (OCHA, 2017b). A complicating factor, however, is that half of the firms reported considerable difficulties in demonstrating the value of such collaborations. To make matters even worse, a majority of firms indicated willingness to terminate their engagements if opportunities to strengthen skills and competences and engage in relationship-building failed to materialize. Such views have raised considerable concern about the long-term sustainability of humanitarian initiatives and operations that depend on private sector engagement. A related concern lies in Kolk’s (2014) observation that partnerships may be especially scarce in places where they are needed the most, i.e., in the most fragile societies and communities where needs are the greatest. This might be because firms tend to shun such areas or because firms are less willing to engage in partnerships and humanitarian action under challenging institutional conditions. This further reinforces the point that a core challenge lies in attracting and sustaining sufficient levels of corporate engagement in the right places at the appropriate time.

A second challenge lies in ensuring the effectiveness of corporate engagement in humanitarian action because effective engagement requires close collaboration between private and humanitarian actors. While firms are often heralded for contributing resources and capabilities on a scale not otherwise accessible to humanitarian organizations, collaborations and partnerships across the private-humanitarian divide can be complex to navigate even to the extent that such collaborations may be experienced as “a clash of worlds.” The most significant operational hurdles to private sector engagement fall into roughly three categories (Bailey, 2014; Oglesby and Burke, 2012): information asymmetries related to a lack of understanding of the humanitarian system on the part of the private sector; differences in organizational culture and associated issues of distrust and communication difficulties; and incompatible resources, capabilities, and time horizons. For example, despite their prominent role in the Mediterranean migration crisis, merchant vessels are not designed to be boarded from the sea surface and often lack the equipment and/or expertise to handle large-scale rescue operations at sea. Such hurdles mean that the effectiveness of corporate engagement in relief efforts is not guaranteed in practice and may even be detrimental to relief operations under certain conditions.

A third challenge lies in ensuring that corporate engagement in humanitarian action is not only effective but ethically sound. The work of traditional humanitarian actors is informed by strict adherence to the principles of humanity, impartiality, neutrality and independence. However, when non-humanitarian actors, such as firms, engage in humanitarian action, adherence to these humanitarian principles is not guaranteed. Firms may not be aware of these principles or be unable or unwilling to comply with them, especially when these principles conflict with their commercial interests or motivations. For example, firms may be hesitant to attend to the humanitarian needs of belligerents who are publicly viewed as the instigators of a crisis out of fear of provoking a public backlash. There is also a risk of firms being reluctant to contribute to initiatives that do not match their objectives. Selective adherence or non-adherence to humanitarian principles is a concern for three reasons. First, it hampers the objective of humanitarian operations to address humanitarian needs wherever they are found. Second, failure to observe the principles of neutrality and impartiality in the delivery of humanitarian assistance may actually intensify a crisis or conflict or impede efforts to reach a sustainable solution. Furthermore, a third and much broader concern is that failure to observe humanitarian principles undermines the legitimacy of the humanitarian system, which is especially problematic because it may hinder the ability of the system to attend to humanitarian needs in the future.

4.2 Corporate engagement in humanitarian action: avenues for future research

Our literature review indicates that studies have explained various ways in which companies affect humanitarian crises and ways in which crises influence business. Comparatively little is known, however, about the equally varied engagements of companies in humanitarian action. As we have argued, we see attention to corporate humanitarian action as a way of broadening the research agendas of international business and management studies by addressing a societally important empirical phenomenon with direct business relevance. We also see corporate engagement in humanitarian action as offering a unique and, in many ways, extreme research context that may serve to test and refine existing theories and their boundary conditions. Below, we have highlighted two examples of areas where corporate engagement in humanitarian action challenges extant thinking in international business and management research while, at the same time, offering opportunities for these fields to deepen our understanding of the dynamics involved in the delivery of humanitarian assistance by public and private actors.

4.2.1 From risk mitigation to constructive engagement with societal risks.

Extant research places considerable emphasis on the undeniable risks incurred by firms operating or considering to operate in areas affected by conflict and crises. Studies have highlighted how humanitarian crises threaten the returns on firms’ investments in affected areas (or raise considerable uncertainty about these returns), as well as how crises raise concerns about the ability of firms to safeguard their staff and assets from violence, abuse, and destruction. Focusing on the implications for business, studies have explored how firms may aim to mitigate and minimize their exposure to risks arising from crises and conflict by withholding their investment and engagement in conflict-affected and crises-struck locations.

Notwithstanding these risks, surveys (OCHA, 2017b) and our own ongoing research suggest that many firms are highly motivated to engage with humanitarian initiatives after humanitarian crises. Usually, this is for a combination of philanthropic and utilitarian motives, including opportunities to expand existing capabilities or develop new ones; to establish business and government relations; or to motivate, attract, and retain employees. Therefore, we see considerable scope for future studies to focus on how firms engage with and organize for societal risks and disruptions rather than merely mitigate and protect themselves against these hazards and whether, when and how firms are able to leverage this experience. Such lines of inquiry would serve to acknowledge that, rather than avoiding conflict and crises, a significant number of firms attempt to become part of solutions. This approach further acknowledges that research into how firms seek to minimize the risks of conflict and crises through their location decisions and entry modes provides little guidance for firms that are already operating in crisis-hit locations.

Such a shift from a focus on the mitigation of risks to a focus on constructive engagement opens up a range of new research questions with relevance for theory and humanitarian action. These may include the following research questions:

  • Whether and how do firms adopt their business model and prepare to operate in crisis-prone areas?

  • How do firms organize themselves to operate during a crisis?

  • Which kinds of tensions arise when firms seek to combine or integrate humanitarian work in their local operations?

  • Whether and how firms are able to overcome these tensions?

  • Where and at which levels in the organization do humanitarian initiatives arise and what does this mean for the internal and external legitimacy and effectiveness of such initiatives?

  • What are the firm-level outcomes of corporate humanitarian engagement in terms of capabilities, competitiveness and legitimacy?

  • Which conditions and capabilities are required for firms to leverage their humanitarian experience, both in the same location and elsewhere?

  • Whether and how does corporate engagement in humanitarian action strengthen firms’ resilience and ability to operate under similar and other adverse societal conditions.

Other relevant questions relate to how firms’ motivations to engage in humanitarian action vary with the scale of crises, their type (natural vs man-made), and location (e.g. close vs far), as well as the salience of crises.

4.2.2 Stakeholder responsiveness and proactive engagement.

Similar to corporate social responsibility engagements, corporate engagement in humanitarian action may be motivated by companies’ efforts to maintain legitimacy and boost their reputation. Indeed, studies suggest that stakeholder pressures may render it unacceptable for companies implicated in a humanitarian crisis to continue business-as-usual. Depending on whether pressures emanate from local or international stakeholders, companies are prompted to engage with humanitarian crises in various ways. For example, stakeholder pressures may prompt multinational enterprises to intervene in violent conflicts (Getz and Oetzel, 2009; Oetzel and Getz, 2012). When business-as-usual is no longer accepted, stakeholders may force multinational enterprises either to promote peace or leave (Westermann-Behaylo, 2009). Thus, future studies may similarly explore how stakeholders’ expectations drive and shape the engagement of multinational enterprises in humanitarian action. In addition, it may be useful to ask how stakeholders’ expectations prompt certain modes of corporate engagement, perhaps to the exclusion of other modes.

However, corporate engagement in humanitarian action can only partly be understood as a response to external expectations. In this paper, we have sought to emphasize and illustrate that companies also proactively engage in humanitarian action. Through our descriptions and illustrations of the different dimensions of corporate engagement, we have shown that companies not only respond to stakeholders but also proactively work and organize with humanitarian actors and other stakeholders in the delivery of humanitarian assistance and that they do this for a wide range of possible reasons. Therefore, we propose expanding the analytical scope beyond a view of corporate engagement in humanitarian action as merely a response to stakeholders’ expectations in order to explore how companies proactively engage with various humanitarian actors.

Expanding the perspective from corporate responsiveness to proactive engagement opens new research avenues into when and how multinational enterprises learn from their experiences of engagement with humanitarian crises. First, by focusing on proactive engagement, research may explore how, with, and from whom multinational enterprises learn, e.g., through mutual problem-solving. Previous studies have shown that companies do not necessarily learn from experience with crises (Oetzel and Oh, 2014; Oh and Oetzel, 2017). Yet, as our review has emphasized, humanitarian actors welcome the involvement of private actors because such engagement complements their own resources and expertise and allows for the sharing of costs and risks. We also expect that companies may benefit and learn from their relations with humanitarian actors who are accustomed to operating in extreme conditions of crises, particularly when companies engage directly. For example, it stands to reason that companies can learn from humanitarian organizations how best to reduce vulnerabilities in their supply chains (Van Wassenhove, 2006). Future research could usefully examine the conditions for and processes of such “reverse” learning and innovation in extreme operating environments.

Second, a focus on proactive engagement may highlight new dynamics around corporate legitimacy. Engagement in humanitarian crises does not necessarily maintain or boost a multinational enterprise’s legitimacy. Indeed, given that humanitarian action is often highly political and that multinational enterprises may not guarantee the operationalization of humanitarian principles, we propose that multinational enterprises’ engagement may sometimes backfire. For example, a multinational enterprise may be accused of supporting warring parties or of opportunistically exploiting a fragile system at the expense of long-term economic and social development. The very risk of such accusations may be the reason that multinational enterprises generally under-report their engagement. For example, out of 15 pharmaceutical companies who had donated products as emergency relief, only six companies publicly disclosed information relating to the type, volume, and destinations of the products they donated (Access to Medicine Foundation, 2014). Thus, we encourage further research into legitimacy dynamics and how companies manage their legitimacy when engaging in humanitarian action and how they work with humanitarian actors to safeguard the appropriateness of their joint efforts.

Another new legitimacy dynamic that calls for investigation arises from our observation that the engagement of multinational enterprises in humanitarian crises is not always voluntary. Introducing the idea of involuntary engagement, we have emphasized that multinational enterprises are sometimes forced to engage, whether by law or by necessity, particularly when they operate in crisis situations where humanitarian and political actors have failed. Involuntary engagement raises important questions around the acceptability and desirability of corporate engagement. Under which conditions might corporate engagement impair business operations? How do companies cope with the risk of their role in humanitarian action becoming permanent? How do firms pre-empt or confront accusations that their actions are contributing to the persistence of crises? How do companies frame policy dialogue to reduce their engagement while maintaining legitimacy across national boundaries?

5. Conclusion

In a world where humanitarian crises are increasingly frequent and complex, the delivery of humanitarian assistance is often beyond the reach or capacity of traditional humanitarian actors. In response, firms and multinational enterprises have stepped up their role as potential partners in humanitarian relief efforts. The aim of this article has been to encourage management research not to overlook or ignore this trend but instead consider private sector engagement in humanitarian action as an important area of research.

There are at least two grounds for this call. The first relates to the fact that humanitarian action is an area where business and societal challenges come together in dramatic ways. Corporate engagement in humanitarian action offers opportunities for a positive agenda in international business and management research with the potential to generate insights that make a difference to human lives and safety across the globe. The second lies in the often considerable imbalance between the power of multinationals and the fragile institutional contexts of the places where most crises occur. The increasing engagement of multinationals in humanitarian action confers new roles on these powerful corporations as humanitarian actors; yet, the motivations for corporate engagement are often at least partly utilitarian and multinational enterprises may prioritize short-term rather than structural engagement with humanitarian initiatives. Such factors mean that corporate engagement in humanitarian action, while vital, may also have unintended and undesirable consequences whether for people with acute humanitarian needs, for the societies where crises occur or for the humanitarian system itself. Therefore, in addition to a positive research agenda, there is a clear need for critical research into the conditions under which corporate engagement does indeed lead to effective humanitarian responses and to sustainable solutions that truly benefit those most in need of assistance.

Figures

The relations between business and humanitarian crises

Figure 1.

The relations between business and humanitarian crises

Dimensions of corporate engagement in humanitarian action

Motive: For-profit vs not-for-profit engagement For profit engagement: Companies engage in humanitarian action as part of their business Not-for-profit engagement: Companies engage in or support humanitarian action for philanthropic motives or for instrumental reasons in anticipation of longer-term benefits
Approach: Direct vs indirect engagement Direct engagement: Companies participate directly in the delivery of humanitarian assistance on the ground Indirect engagement: Companies support or enhance the capacity of others to engage in humanitarian action such as through financial donations and donations in kind
Coordination: Independent vs collaborative engagement Independent engagement: Companies engage in or support humanitarian action autonomously and on the basis of ad hoc coordination with other actors Collaborative engagement: Companies engage in or support humanitarian action in partnership with other companies or humanitarian actors
Voluntariness: Voluntary vs involuntary engagement Voluntary engagement: Companies voluntarily choose to engage in or support humanitarian action Involuntary engagement: Companies are obliged to engage in or support humanitarian action due to normative or legal requirements

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Acknowledgements

The authors thank Florian Becker-Ritterspach, Christoph Dörrenbächer and Snejina Michailova for their encouraging suggestions and Tania Grønbæk for excellent research assistance.

Corresponding author

Jasper Hotho can be contacted at: jh.egb@cbs.dk