The company they keep

Handing over money

© Johner Images/Alamy

‘We’re at a critical moment for the world’s children,’ warns Justin Forsyth in Save the Children’s 2013 annual report. The chief executive of the British grouping of this international NGO could not be more right. Needless wars, dispossession through climate change, the rise of ugly rightwing politics – the human toll is high. Children and women, as ever, bear the brunt.

‘We face a moment of opportunity, challenge and responsibility,’ Forsyth continues. ‘If we’re going to achieve even more impact for children, we need to work in different, innovative ways.’ Mark Goldring, Oxfam GB’s boss, echoes such sentiments: ‘Our challenge is not only to continue to do this work, but to scale it up.’ CARE International is no less ambitious, determined to focus even more efforts to empower women and girls.

Despite economic recession, these three international NGOs mustered combined funds of $3.2 billion to spend on the poor last year.1 Save the Children UK managed a 20-per-cent jump during 2012-13, bringing its income up to a record $525 million, due in part to corporate donations, up a third from 2012 to $40 million in 2013.

Partners unlimited

Corporate funding of international NGOs is nothing new. CARE USA has collaborated with Coca-Cola for three decades. ‘We are extremely grateful for the trust placed in us by compassionate donors and partners,’ says CARE in its 2013 annual report. As well as Coca-Cola, CARE counts arms manufacturers General Electric and Boeing, and clothing companies Nike and Gap, among its major donors. Oxfam, too, has embraced the corporate agenda and ‘is proud to be at the forefront of partnerships between the business sector and the NGO community’. Save the Children’s message couldn’t be clearer: ‘Teaming up with Save the Children to market a new or existing product could boost your sales, profile and customer base.’

But do such partnerships offer the win-win solution claimed by the NGOs and their corporate funders, or are there losers? Does Erinch Sahan, an Oxfam private-sector adviser, have a point when he blogs: ‘I want to believe that pursuing profits will result in a sustainable world and the end of poverty’? One such partnership involves Save the Children and pharmaceuticals giant GlaxoSmithKline (GSK). Since 2011 Save the Children has benefited from GSK’s initiative to reinvest 20 per cent of the profits it makes in the world’s least developed countries (a fraction of its global $7.5 billion profit in 2013) back into projects which strengthen healthcare infrastructure and support the research and development of child-friendly medicines. Save the Children’s website claims a million children will be helped as a result of a ‘ground-breaking’ deal signed with GSK to improve children’s health in some of the poorest countries of Africa.

'Teaming up with Save the Children to market a product could boost your sales, profile and customer base' - Save the Children’s assurance to potential corporate partners

No mention on Save the Children’s website, however, of one of GSK’s less child-friendly products – the antidepressant Paxil (Seroxat/paroxetine). In 2012 the company was fined $3 billion by the US government after pleading guilty to criminal charges, including bribing doctors and encouraging the prescription of Paxil to children, even though the drug was unsuitable and unapproved for this use.2 ‘We would never refrain from speaking out on an issue because we had a partnership with a particular company. That would clearly compromise our values,’ claims Save the Children. When contacted for a response, it admitted it was ‘aware of reports on the historic issues relating to Paxil… but our belief is that the risks are outweighed by the benefits of the partnership.’3

Oxfam’s uncompromising vision of a world where everyone has enough to eat is embodied in the high-profile ‘Behind the Brands’ campaign, which promises to ‘provide people… with the information they need to hold the Big 10 [global food and beverage producers] to account’. One such is Unilever, about whom Oxfam was, until recently, rightly critical: ‘[Unilever’s] record on land rights leaves plenty to be desired’.4 By its own Responsible Sourcing policy, Unilever will not require 80 per cent of its suppliers to consider the rights of women to land ownership until the end of 2017. In the past Greenpeace has accused Unilever of sourcing its palm oil from Indonesian suppliers whose activities included ‘tearing up areas of pristine forest then draining and burning the peatlands’.5 The company was recently fined $120 million by the European Commission for establishing a price-fixing cartel in Europe along with Proctor & Gamble.6

Yet despite all the criticism, ‘Unilever is a vocal advocate for tackling climate change and new business models that benefit poor farmers,’ according to Penny Fowler, head of Oxfam’s private sector team. ‘[W]e will continue to engage with Unilever and other companies because reducing global poverty and inequality is good for business and us all.’ Oxfam currently helps the transnational under its ‘Corporate engagement’ programme ‘to incorporate thousands of smallholder farmers into their [Unilever’s] global supply chain’. But is this really an innovative way of ending poverty or is Oxfam helping a rich company get richer at the expense of poor farmers? Paul Polman, CEO of Unilever, is in no doubt of the benefits to the company, giving thanks to ‘partners who are assisting us to deliver this new business model’.  

CARE USA similarly waxes lyrical about working with transnationals. ‘[We] believe that dynamic partnerships are critical to solving global challenges. Our partners are committed to developing and supporting socially responsible initiatives that build stronger communities in the developing world while enhancing business and development goals.’ Committed to donating 1.6 per cent of pre-tax profits to good causes, the Nike Foundation is one such partner, working ‘to unleash the unique potential of adolescent girls to end poverty for themselves and for the world’. Nike calls it ‘the girl effect’.

In 2000 a BBC documentary uncovered child labour and poor working conditions in a Cambodian factory used by Nike. The documentary focused on 7 girls as young as 12 who all worked 7 days a week, often 16 hours a day.7 Nike has been castigated the world over for its use of sweatshops since the 1990s, yet as late as 2013 Nike stated that a third of its contracted factories, or potentially 300,000 workers, still did not meet the company’s own minimum standards for worker treatment.8

Close companions

Is Nike really a ‘compassionate’ donor to be proud of, as CARE would have us believe? Or have all three NGOs become too close to big, unscrupulous corporations, preferring to mount large-scale, high-profile schemes that deliver food and medicine to the needy and greater profit margins to the transnationals, at the expense of grassroots work to tackle the endemic, structural causes of poverty?

Just how close the corporate and international charity worlds have become is evident from a look at those at the top of the NGOs. Alex Cummings is both treasurer of CARE USA and executive vice-president of Coca-Cola. Save the Children’s director of human resources, Paul Cutler, is a former employee of GSK. Oxfam trustee Dame Marjorie Scardino, a Forbes rich-lister, is a non-executive director of Nokia, an Oxfam donor. Connections to powerful political figures are close, too. Save the Children’s $200,000-a-year chief executive Justin Forsyth and Oxfam trustee David Pitt-Watson are both former advisers to New Labour’s controversial prime ministers, Tony Blair and Gordon Brown respectively. Much more worrying, however, is the accusation that large international NGOs are helping to legitimize companies like GSK, Coca-Cola, Nike and Unilever, rather than holding them to account for serious malpractice. With transnationals treating corporate social responsibility schemes as little more than a necessary expense to whitewash their reputations, do NGOs really need to get in on the act?

Ian Brown managed aid programmes for 15 years in Africa, the Middle East and Southeast Asia for Oxfam, the Mines Advisory Group and Terres des homes.

  1. CARE International had revenues of $0.7 billion, Oxfam International $0.6 billion and Save the Children International $1.9 billion.

  2. ‘Pharma overtakes arms industry to top the league of misbehaviour’, 8 July 2012, The Observer;

  3. Statement from Save the Children to the author, 9 October 2014.

  4. Behind the Brands, accessed on 8 October 2014. The page was updated by Oxfam and the criticism removed on 9 October 2014.

  5. ‘Palm Oil: Cooking the climate’, 8 September 2007, Greenpeace International;

  6. ‘Unilever and Proctor & Gamble in price fixing fine’, 13 April 2011, BBC News.

  7. BBC Panorama, 15 October 2000.

  8. Nike Inc;

This is my story

The international non-governmental organizations (NGOs) have been in the firing line more often than usual over the past year: Kevin Myers, writing in the _Irish Times_ in June 2000, berates them as ‘autonomous, unelected and frequently unaccountable’ with an ‘addiction to raising and spending money’. Tajudeen Abdul-Raheem, General Secretary of the Pan-African Movement, accuses Northern aid workers of ‘arrogance’ and having ‘a feeling of superiority and we-know-best attitudes’ in last August’s _New Internationalist_. And _The Hunger Business_, a documentary shown on British television last November, suggests that in some instances the international NGOs did more harm than good during the Ethiopian and Rwandan crises of the 1980s and 1990s respectively.

The accusations aren’t new. Charges of misusing funds, of a lack of transparency and incompetence have periodically been levelled against international NGOs by journalists and others since 1985, when Bob Geldof’s Band-Aid success transformed the likes of Oxfam and Save the Children into multi-million-dollar, high-profile operations. Criticisms have never stuck, however, when pitted against scenes of worldwide suffering. Famine, flood and war in Africa, Asia and Europe throughout the 1990s, coupled with slick publicity campaigns and increased funding from Western governments, have spawned ever-larger NGOs, commanding budgets in excess of $100 million, in ever-greater numbers. ‘NGOism’ is big business, especially in the burgeoning emergency sector: during the Rwandan crisis Oxfam was providing water to 750,000 refugees in eastern Zaire (now the Democratic Republic of Congo) alone.

The new millennium appears to offer little hope of a brighter future for many people in the South and so, despite the recent flurry of criticism, the right of the international NGOs to speak and act on behalf of the Southern poor will continue unchallenged. Or will it? I say no. I say that the NGOs are unaccountable, that this has bred a culture of arrogance, wastefulness and dishonesty masked by the public, profitable face of integrity. I know because I spent 11 years, between 1987 and 1998, managing aid projects in Africa and Asia. Many aid workers will privately agree that the NGOs need urgently to reform, but nothing will change so long as critics remain on the outside, unable or unwilling to name the culprits. Anonymity provides perfect protection. Only when specific NGOs are called to account for specific actions will the movement sit up and take note.

This is my story.

Between November 1993 and February 1996 I was country representative of Oxfam Great Britain and Ireland’s programme in former Zaire. I resigned in February 1996, partly due to irreconcilable differences within the Kinshasa management team – but mainly because the programme I was responsible for was, in my opinion, doing very little to make a difference to the lives of poor people. Managers in Britain must have agreed with my diagnosis because, following my resignation, most of the programme in central and western Zaire was closed down. Soon afterwards I was asked to deputize for six months for the regional representative in eastern Zaire during her maternity leave. This post carried with it responsibility for Oxfam’s emergency programme in the Rwandan refugee camps around the towns of Goma and Bukavu. As country representative I inherited an existing arrangement to procure money for Oxfam’s operations. Rather than using the traditional banking facilities – which, admittedly, were limited, though not moribund – Oxfam took large sums of cash from Tabazaire, the Zairean subsidiary of Rothmans International, in order to run its operations. The arrangement was ongoing when I left, meaning that, over the years, Oxfam would have accepted several million dollars of tobacco money. In return we deposited equivalent amounts into overseas accounts specified by the cigarette manufacturer. By acting as an unofficial conduit for its profits, Oxfam was saving Rothmans significant amounts in taxation and directly aiding a company whose product, sold cynically without any health warning in most countries of the South, kills. There were, of course, alternative, morally acceptable arrangements, but Tabazaire proved to be a reliable supplier.

Operating in a country with limited banking infrastructure and endemic corruption was never going to be easy. We weren’t so naïve as to think otherwise. Our mistake was to believe arrogantly that Oxfam’s humanitarian end justified the means.

In the case of the international NGOs’ activities in the refugee camps of eastern Zaire, I question how far we were responding to the ‘humanitarian imperative’ for which we were being handsomely rewarded. I remember standing on a hill overlooking Lac Vert camp watching a steady stream of people ferrying provisions, distributed by the NGOs, to the headquarters of the rump Rwandan army half-a-kilometre away. As food and water went in, orders and weapons for the members of the interehamwe militias in the camps to carry on the genocide were coming out.

I watched but did nothing. I was doing my job, making sure that clean water was supplied to the refugees around the clock, a service that many of the townspeople of Goma did not enjoy. I pushed away the difficult moral question about whether the NGO community should have been feeding, sheltering and watering genociders who were now killing innocent Zaireans with impunity. Life was too good in Goma to burden oneself with difficult moral questions. I had a house by the lake, complete with satellite TV, a full-time maid and a tax-free salary of $35,000.

Now I am ashamed that I did nothing.

This essay makes for uncomfortable reading. I believe, however, that it also makes for necessary reading, because I care about those in the South who are not getting the assistance they deserve and about those in the North who give generously without knowing the truth about what happens to their donations. It is necessary because I can no longer live with my past dishonesty and because I believe that NGOs can play an important role in fighting for a fairer world – if only they have the courage to face up to past wrongdoing, root out malpractice and rebuild legitimacy.

Accountability is the key to genuine reform. British NGOs are theoretically accountable to the Charity Commission, to host governments, to donors and to beneficiaries. But this is not true in practice. With over 180,000 organizations to monitor, the Charity Commission has only 50 staff actively engaged in investigations. Host governments are, in my experience, ignored by NGOs, who dismiss them as meddlesome bureaucrats, despite formal agreements obliging NGOs to submit regular reports and accounts. Institutional donors, such as the Department for International Development (DFID) and the European Union, give only cursory attention to how their money is spent. The donating public is thrown selective, simplified snippets of good news in return for its cash. And the beneficiaries? They dare not question.

Consequently NGOs have become a law unto themselves. And until they are brought to account for their actions, the kinds of behaviour cited above will continue. I believe that heads of other NGOs should think about setting up an independent body, involving members of the public, beneficiaries wherever possible and MPs of all political persuasions to investigate malpractice and report publicly its findings. A mechanism similar to the Truth Commission established in South Africa might be appropriate, allowing individuals to come forward and contribute as I have.

However, the process will not just be about rooting out malpractice. Perhaps more importantly, this will be a crucial opportunity for the NGO movement to re-examine its aid ethos and, by doing so, to forge new relationships with stakeholders which are no longer tainted with arrogance and duplicity, but are based on honesty and equality. Only after the catharsis should an independent regulatory structure – an overseas arm of the Charity Commission, perhaps – be created to monitor the international NGOs.

Such a process will be damaging in the short term, but will, I believe, ultimately lead to a strengthened, reinvigorated movement better able to defend the interests of poor people against increasingly rapacious global capitalism and uncaring, undemocratic regimes.

It is not my intention to destroy the well-run projects that do benefit the poor. I do not want to bring down a movement which campaigned so effectively to bring about the Ottawa Treaty banning landmines and which, under the ‘Jubilee 2000’ banner, has helped draw the public’s attention to the curse of Third World debt. I simply feel that the time has come to face up to what so many of us know to be wrong about the international NGOs, and to work to put things right – for everyone’s sake. If we do not act now, the consequences will be all the more devastating later on.

*Ian Brown* is a freelance writer and teacher. His published work includes _Khomeini’s Forgotten Sons: the Story of Iran’s Boy Soldiers_ (Grey Seal, 1990) and _Cambodia: An Oxfam Country Profile_ (Oxfam, 2000). He has recently completed a novel set in the world of international aid and development.

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