Corporate Social Responsibility: Safer and Healthier Communities

Published: 11 December 2006

First of all, I would like to thank the Inter American Development Bank for the invitation to participate in the fourth Inter-American Conference on Corporate Social Responsibility, an issue which the Red Cross is involved in and can contribute to.

I would also like to thank the President of the Brazilian Red Cross, Dr. Luiz Hernandez, for welcoming us and leading the Red Cross delegation during this event.

For over 85 years, the International Federation has held a predominant position as a humanitarian aid organization through its core areas of work: disaster management, health promotion and the dissemination of humanitarian values.

Its worldwide network of member National Societies play a significant role in reducing the vulnerability of those who live in some of the most dangerous parts of the world.

All of its actions are based on seven fundamental principles: Humanity, Impartiality, Neutrality, Independence, Voluntary service, Unity and Universality.

Humanity, because our work is based on the need to provide assistance without discrimination, and endeavors, through international and national capacity, to prevent and alleviate human suffering wherever it may occur.

Without exception, we seek to protect life and health, and to ensure respect for the human being. It promotes mutual understanding, friendship, cooperation and lasting peace amongst all peoples.

Neutrality is essential as well. In order to enjoy the confidence of all, the Red Cross does not take sides in hostilities, or engage, at any time, in controversies of a public, racial, religious or ideological nature.

In a global world, universality enriches our work. The Red Cross, where all Societies have equal rights and share equal duties in helping each other, is universal, but is strengthened by the valuable local contribution of its over 97 million volunteers who work every day in all corners of the world.

By working at local, national and international levels the Red Cross is contributing to improving the lives of vulnerable people.

Although it is recognized for responding to emergencies and disasters, the IFRC is investing more and more in efforts to reduce the risks which populations are exposed to.

Today we have gathered here to learn more about this problem, which in one way or another affects us all.

In its Humanitarian Action Programme, the Red Cross reflects the importance of reducing the risk of disaster in all its forms. Through its Global Agenda, the Federation has proposed working towards the attainment of the Millennium Development Goals by
- reducing the number of deaths, injuries and impact from disasters;
- reducing the number of deaths, illnesses and impact from diseases and public health emergencies;
- increasing local community, civil society, and Red Cross Red Crescent capacity to address the most urgent situations of vulnerability;
- promoting respect for diversity and human dignity, and reducing intolerance, discrimination and social exclusion.

Additionally, the International Federation fully supports the conclusions reached at the Second World Conference on Disaster Reduction, and continues to work through its 185 National Societies and in cooperation with the United Nations, Governments, donors and civil society to reach the objectives within the Hyogo Framework for Action.

It is not a mere coincidence that this topic has acquired increasing significance on the agenda of Governments, humanitarian organizations and communities themselves.

In the last decade, disasters have caused damages amounting to an annual average of 67 billion US dollars. In 2005 alone, this amount stood at 220 billion US dollars worldwide according to data provided by the World Bank .

The World Bank also states that damages caused by disasters in developing countries in terms of GDP percentage are even 20 times higher than in developed countries.

These damages not only include the impact on infrastructure caused by disasters but also the increase in conditions of vulnerability triggered by other risk factors such as demographic growth, urban growth, domestic migration, lack of basic services in urban areas and a rise in poverty rates.

According to the World Bank and the United States Geological Survey, during the 1990s, economic losses caused by disasters could have been reduced to as much as 280 billion US Dollars across the world if an investment of 40 billion US Dollars had been made in prevention and preparation measures.

Although it is increasingly recognized that each dollar invested in disaster risk reduction ultimately produces a 3 - 4 US Dollar saving, research shows that a number of donor organizations still dedicate less than 10 % of their humanitarian aid budget for the reduction of disaster risks.

Moreover, a significant number of donors, Governments and development organizations do not evaluate the risk of disasters within their development plans in a systematic way.

Currently, the world faces disasters on an unprecedented scale. Since the 1990s, disasters have cost an average of 58 thousand lives each year and have affected nearly 225 million people. In 2005 alone, 92 thousand people died as a result of over 150 disasters.

The reduction of risks in the face of disasters relates to development in two important ways: on the one hand it may benefit the implementation and sustainability of social projects, and on the other, the adoption of political, social and economic decisions without adequate technical direction may put communities at risk and, in the medium and long term, compromise their development.

Let's look at an example. When hurricane Mitch hit Honduras in 1998, it destroyed 60% of the country's bridges, one fourth of all schools, and half the agricultural production of the country.

As a result, three million people needed support. The President of the country confirmed this fact: fifty years of work in development vanished in 72 hours. Eight years later, the Red Cross is still supporting the communities affected by this disaster.

The common theme behind all neglected crises is social vulnerability and chronic poverty, compounded by governments' inability to cope.

These factors expose people to a wide range of hazards and undermine their ability to cope and recover.

Governments and aid organizations must prioritize disaster risk reduction and promote community resilience and development.

These issues are addressed in the IFRC's World Disasters Report for 2006 which will be launched globally on 14th December.

But disasters are not only natural. Earthquakes, rains, hurricanes and volcanic eruptions are some of the natural phenomena that have always been present on the planet. Their impact on people and the destruction they generate is the result of the poverty and vulnerability affecting thousands of men and women.

But human beings also cause disasters. Fires and chemical accidents are two examples of "anthropic" disasters or disasters caused by human beings.

In the case of Latin America, inequity and poverty are the most devastating disasters for the continent.

Every year, studies conducted by internationally renowned organizations confirm that Latin America is still the most inequitable region in the world aggravating other conditions that also expose the population to disasters, such as rapid demographic growth, unplanned urbanization, environmental degradation and climatic change.

The long-term challenge is to revert this condition, but in the short and medium term, there are other actions that may at least contribute to reducing disaster-related vulnerabilities.

In this context, the priority of the Red Cross is to develop capacities to contribute to safer and healthier communities, through the following three actions:

First, preparation for the response to disasters, making sure adequate systems are in place and the required capacity to respond appropriately and efficiently at the national, regional and international level.

Second, is mitigation and prevention to promote the adoption of concrete corrective measures to reduce risk in communities by ensuring schools, local organizations, local authorities, large and small companies participate in these processes.

Third, the full integration of disaster risk reduction into sustainable development planning as a key measure to achieve "safe" development through integrated community work and the strengthening of our network of volunteers.

The essence of disaster risk reduction work is to ensure that rural and urban populations are aware of the threats they are exposed to, and especially, aware of their capacities and resources available in order to face up to them.

This increases their chances of preventing the impact of disasters caused by human beings or natural phenomena.

All of the efforts aimed at preventing disasters are a commitment to development and to life. The better educated and organized a community is, the better will its capacity be to prevent, reduce and mitigate the effects of natural phenomena.

Prevention initiatives allow communities to be safer and better-prepared. Large or small, urban or rural, all communities that strive to prevent disasters are contributing to their own transformation.

Communities are not alone in disaster prevention. Alliances among local associations, Government institutions, the private sector, international organisms, and humanitarian organizations contribute significantly to disaster reduction processes.

The synergy and complementary work among these actors add greater value to the efforts towards creating safer and healthier communities. This coordination of efforts reduces vulnerabilities and increases capacities.

Companies work in communities, both rural and urban and they are also part of the community. They are actors, and as such, their activities have an impact on their community.

On the other hand disasters have an impact on the company as well, in most cases with big economic consequences, due to shut downs, inaccessibility, human losses and product destruction, etc.

This impact is not only on the company but on the community which it is a part of. When a company focuses on Community Risk Management, a win - win situation will be created.

The risk of paralyzing their operations or having difficulties in production, distribution, or for the work force will be reduced.

Getting involved in Community Risk Management, will have a tangible benefit if and when a disaster occurs. This is also an effective way to get directly involved with the community and its development.

This means that the company is seen as having an active role in community affairs, not through charitable activities, but by taking part in development planning and implementation.

By participating in this way, they will have a say in the interests of the community, because they are actors just as everyone else.

It is also essential that companies revise their productive processes, their goods and services, and make sure that they do not have a negative impact and increase risks for communities facing potential disasters.

Finally, many companies have very clear risk management policies, which have become a part of the corporate culture.

Corporate volunteering is a great way to work with the community. Likewise, when workers take part in community activities they not only participate but act as community volunteers.

The Red Cross sees the participation of companies as crucial in facing the increased risks of disasters in the world.

Reducing vulnerability and increasing capacities to face this risk is a responsibility for all, including governments, civil society, the Red Cross, and business.