Time to give back
Gamal Essam El-Din
finds out how a pioneering non-governmental organisation has been encouraging social responsibility among Egypt's business community
In a keynote speech on Labour Day at the end of April, President Hosni Mubarak surprised his listeners by criticising the country's business community. In a speech that focussed on the ruling National Democratic Party's (NDP) commitment to meeting the needs of the poor and limited-income classes, Mubarak suddenly stopped, saying "I have a message to send to businessmen."
In Mubarak's words, "ordinary citizens hold negative views of you and think that your behaviour has become provocative in recent years." During Ramadan, for example, when "I asked a businessman where he was going to have Iftar, he told me he was going to have it in a five-star hotel such as the Sheraton or the InterContinental," Mubarak said.
"But instead of spending extravagantly on Iftar meals or on other events, why doesn't the business community sponsor social programmes or Iftar meals for ordinary citizens," Mubarak asked. If it did, he added, poor and limited-income citizens might change their negative views of business people, and business people would feel more secure about their businesses themselves.
It is not only President Mubarak who has recently criticised Egypt's business community and alerted the country's high- profile millionaires to the importance of changing their lifestyles in a country where more than 40 per cent of the population live under the poverty line. The People's Assembly -- Egypt's lower house of parliament -- has also joined the fray.
Just one month before Mubarak's speech, opposition MPs took some high-profile businessmen to task for what they considered to be their socially provocative practices. In a statement directed at Prime Minister Ahmed Nazif, Gamal Zahran, an independent MP and professor of economics and social sciences at Suez Canal University, spoke about what he called the extravagant lifestyles of business people in a poor country like Egypt, pointing to their organising expensive wedding parties, building luxurious tourist villages and resorts, and spending millions of pounds on election campaigns for parliament.
"What is most disastrous is that they do not do these things in private, but are instead keen to have them publicised on the pages of newspapers and on television, to the dismay of poorer citizens," Zahran said.
According to economist Abdel-Khaleq Farouk, Egyptian business people spent more than an estimated LE300 million in 2008 on what he described as "publicising their provocative and socially irresponsible lifestyles," with money spent by business people on social programmes not exceeding LE50 million per year.
"Elsewhere in the world, we see that prominent business people are keen to sponsor philanthropic activities and social programmes," said Farouk, adding that "Bill Gates, for example, one of the richest men in the world and the founder of the US-based company Microsoft, is also the owner of a charity and philanthropic organisation that allocates millions of dollars each year to spending on the poor and fighting diseases such as AIDS."
Another example, Farouk said, is the Saudi Prince Al-Walid Bin Talal, who was ranked by the US Forbes magazine as the fifth richest man in the world in 2008. Talal, Farouk commented, had set up a charity with the aim of helping poor people and the victims of wars in Arab countries and other parts of the world. "Unfortunately," he added, "most business people in Egypt lack this sense of philanthropy and social responsibility."
However, for their part, many of Egypt's high-profile business people have begged to differ with such negative views, many of them saying that they are keen to set aside part of their profits to finance social and philanthropic programmes.
Mustafa El-Sallab, for example, a well-known businessman and member of the NDP, told Al-Ahram Weekly that Egypt's businessmen were very much aware of their social responsibilities. "I assure you that businessmen in Egypt spend millions on charity and social programmes every year, but they do this in private and without publicity or fanfare," he said.
The ruling NDP, whose business membership has increased in recent years, has also been keen to develop programmes for the poor. Gamal Mubarak, for example, the 46-year-old son of President Hosni Mubarak and chairman of the NDP's powerful Policies Committee, embarked in March on a three-year development and social-justice programme intended to improve living conditions in 1,000 of the country's poorest villages. Many of the NDP's leading business members have joined Gamal Mubarak on tours of such villages, emphasising that they have a social role to play.
Gamal Mubarak is also the chairman of the Future Foundation (FF), an independent non-governmental organisation created in 1998 to help improve the living conditions of poor families in slum areas.
According to Mireille Nessim, executive director of the FF, the foundation was the brainchild of Egypt's First Lady Suzanne Mubarak. "Concerned that the needs of the poor were being ignored by the private sector," Nessim explained, "Mrs Mubarak urged business people to assume their social responsibilities towards the poorer segments of society and proposed establishing a foundation that would rely on private donations to provide low-cost housing for low-income families."
In response to the first lady's appeal, the Future Foundation was then established by Gamal Mubarak and 14 other businessmen. In a letter on the FF's website, Mubarak explains that, "the foundation is a pioneer experience in cooperation between the private sector, government, and civil society, to address one of the most pressing problems facing low-income urban communities in Egypt, that of housing." Mubarak, himself a banker who studied business administration at the American University in Cairo (AUC), believes that the FF is a vivid example of the private sector assuming its responsibility towards the poor.
"Over the period since the FF's inception in 1998," Mubarak said, "the board of directors, which is made up mainly of members of the private sector, has managed the foundation's activities single-handedly with no support staff at all," even if an institution was established in 2001 in order to accelerate the board's activities.
For Nessim, the FF's partnership with the private sector is intended to encourage the principle of social responsibility among business people. "When the FF was created in 1998, the principle of social responsibility among business people was almost lacking in Egypt," she said, and since then the foundation has done a great deal to encourage business people of the importance of exercising a more active social role.
In market economies like Egypt, corporate social responsibility is important not only to help poor people mitigate the vagaries of liberalisation and privatisation policies, but also to change negative views of business people in Egypt as the plunderers of society and swindlers of the poor.
According to Nessim, the FF was the first organisation in Egypt to mobilise the private sector to assume its social responsibilities. "Right now, we have a list of as many as 24 private-sector companies that help fund the FF's social programmes," she said, adding that "fundraising comes both in cash and in kind."
Topping the list are some of the most famous companies in Egypt, including the Mansour Group, Bahgat Group, Ezz Group, Saoudi Group, Maghrabi Hospitals and Centres, MenaNet and Talaat Mustafa Group. The list also includes Egypt- based multinationals such as British Petroleum (BP), Hyundai, JW Marriott, McDonald's and Cadbury. "Some of these offer funding for building schools, while others provide in-kind support in the form of offering meals for children or buses for transporting trainees," Nessim said.
The FF's activities are not just limited to providing low-cost housing to poor people, however. According to Nessim, "the foundation was established with the aim of improving the quality of life of new and existing low-income urban and underprivileged slum areas in Egypt." To this end, the foundation provides beneficiaries with affordable housing, basic services and sustainable development programmes, in cooperation with the government and the private sector.
In 2005, the foundation launched a pilot project to rehabilitate slum areas in the district of Agouza in the Giza governorate. Densely populated, with many inhabitants living in unsafe conditions, the foundation selected Agouza as the location for its first slum-area upgrading project following a needs assessment. Slum areas in Agouza were contained, and therefore manageable in terms of size and budget, Nessim explained, and the area's central location, and the fact that other parts of the district contain high-end housing, also rendered the upgrade desirable not only for the slum area, but also for its surroundings.
"As a result of three stages of implementation and sponsorship by the private sector, the project has so far delivered twelve buildings, including 192 housing units, a comprehensive healthcare centre, a social-welfare unit, a market area including 24 shops, and a children's centre including a nursery and a library," Nessim said.
The foundation, in cooperation with Giza governorate, also helped upgrade and renovate 113 houses not requiring demolition, as well as the local infrastructure including water pipes, sewerage systems, electricity and gas pipes. Furthermore, it reconnected the area with the outside world through building new roads, reviving the area economically and culturally and safeguarding it against future problems.
It has also delivered a community development centre that includes a computer lab, a lecture hall, a theatre and several classrooms for conducting educational and empowerment programmes. "The centre is designed to guarantee the sustainability of the foundation's efforts after the end of the project," Nessim said.
Nessim emphasised that several private businesses had helped sponsor the FF's Agouza project. A case in point, she explained, was BP, which financed the renovation and upgrading of the 6 October and Al-Nasr elementary schools and the Agouza preparatory school as part of the foundation's slum-upgrading project.
Hisham Mekkawi, president of BP Egypt, explained that BP mainly focuses its corporate social responsibility efforts on partnership with non-profit organisations such as the FF. "In its partnership with the FF, BP Egypt has found an opportunity to participate in sustainable economic development, particularly for the underprivileged," Mekkawi said.
Another sponsor of the foundation's project in Agouza is the Hebat Al-Nil Company for Vegetation. The owner of the company, businessman Mohamed Abdel-Atti, explained that his first encounter with the FF came in 2004 when he was "captivated by the foundation's mission to supply the underprivileged with homes." The foundation was working on building housing projects in three new cities, 6 October, Al-Shorouq and Tenth of Ramadan, at the time, for which Abdel-Atti donated LE1.5 million worth of plants.
"The success of these projects and the spread of greenery in such new desert cities encouraged me to donate further in the renovation of Agouza and the Al-Nasr and 6 October schools," Abdel-Atti said.
On 6 September during the holy month of Ramadan, Gamal Mubarak and the FF's board of directors organised an Iftar meal to celebrate the completion of the fourth and final stage of the Agouza project, this Ramadan Iftar now being part of an annual tradition, Nessim explained. "The meal is a very happy occasion, on which beneficiaries receive the title deeds to their new housing units," she said, adding that "it is also a very good opportunity for them to meet and share a meal with the foundation's chairman, Gamal Mubarak, board members, business people and ministers and to voice any grievances or problems."
The activities of the FF have received wide coverage in the Egyptian media and not only because its chairman is Gamal Mubarak. Instead, such coverage has been due to the fact that the foundation offers a good example of corporate social responsibility in the country, helping to change older negative views of business people.
A number of analysts believe that negative views will persist for a while, especially when people read or hear about business people facing trials on allegations of involvement in crimes such as killing a singer or plundering a bank.
After its success in Agouza, Nessim indicated that the foundation had embarked on rehabilitating another slum area in Ezbet Haridi in the Al-Waili district of eastern Cairo. The project was implemented in collaboration with the ministries of Al-Awkaf (religious endowments) and Housing , and it was intended to assist as many as 107 families living in run-down, unsafe and overcrowded housing.
"The families were temporarily relocated to the FF's housing project in the new city of Obour and then moved back again to Ezbet Haridi after the completion of the rehabilitation work this month," Nessim said, pointing to the experience as another good example of corporate social responsibility in action and effective partnership with the government.