Core Standards

Markets play a critical role in how people survive, so understanding how they work during a crisis, and the best way for humanitarian responses to work with them, is essential. Markets are a physical and/or virtual space where people and businesses buy and sell goods and services; and response efforts take place within a country's economy as well as in its geographical area. Interventions need to be aware of market realities and how market systems link together the actors, governance and power dynamics, and formal and informal spaces where individuals, households, and businesses of all sizes come together.

Crises certainly affect markets, but not always in predictable ways. Crises can disrupt specific activities and relationships within a market or cause markets to fail completely. As a result, individuals, households, and businesses may be forced to take actions that undermine their current well-being and future viability. For households, this may include eating less, reducing spending on medical care and other essentials, removing children from school, and selling productive assets, such as livestock. Businesses may be forced to delay maintenance and investments, sell off equipment, and lay off workers. It is important to remember that some markets grow during and after a crisis, and some even thrive in this situation.

The MERS is a partner to the Sphere Handbook and as such shares the same foundations of quality and accountability for humanitarian standards. Specifically, the MERS Core Standards are harmonized with and emulate the Core Humanitarian Standards (CHS), adapted specifically for those working in economic recovery. The aim of linking the MERS and CHS is to establish stronger accountability to affected populations.

The MERS Core Standards help to ensure that programs meet the most basic responsibilities of economic recovery activities, and that interventions support opportunities for people to earn an income – via wage employment or self-employment – and to rebuild their lives, on their own terms, with dignity.

Core Standard 1

Humanitarian programs are market aware

Program design and implementation decisions consider context, market system dynamics, and communities. Market systems programming begins with the needs of the targeted groups.

Key Actions

• Learn which markets the program may interact with by speaking to procurement, logistics, and other operational teams in addition to the program staff.

• Determine if market assessment or analysis has taken place. If not, conduct one to develop interventions based on the needs of the population and sustainability of activities. Include a determination of economic viability, through a cost–benefit analysis and/or feasibility study (see also Assessment and Analysis Standards).

• Use the analyses to decide on your program activities. Consider the right level of market intervention and the views of a variety of stakeholders, including the community. Utilize existing market mechanisms, unless there is a compelling reason not to.

• Consult with relevant public and private-sector stakeholders to work in partnership.

• Establish monitoring systems to collect and analyze information on the market and the impact of the program. Feed this information (including social impacts) into project learning for ongoing improvements.

• Communicate the intent of economic activities with staff, partners, and community members, and be clear about who they can serve.

• Engage the targeted population throughout the program cycle.

Key Indicators

• Interventions invest in economically viable activities that target stable or growing markets.

• Interventions do not negatively distort markets.

• Interventions should be appropriate and relevant, with a clear logic for how they will meet people's needs and support capacities.

• Interventions have a monitoring system in place to enable regular and ongoing monitoring of changes (e.g. market prices, risks to market actors). Programs are regularly adjusted based on changing market and social conditions.

Guidance Notes

(1) Market systems

Economic recovery should consider interventions that work at multiple points across a market, from input suppliers to producers, end markets, and policymakers. Programs that work at only one level and do not recognize these interconnections risk missing opportunities and creating market distortions with social consequences. Interventions may require a wide range of activities to have the greatest impact.

(2) Viability

Choosing the right program activities depends on understanding the markets in which enterprises and households operate. Economic recovery programs should orient enterprises and households to markets that are growing, stable, or have unmet demand in order to provide opportunities for employment and/or increased income to sustain livelihoods. Shrinking or non-competitive markets are ultimately not sustainable. Assistance that pushes people to stay in these markets will undermine their livelihoods in the long run. Additionally, noncompetitive markets have fewer incentives that encourage entrepreneurs to invest, adopt new technologies, or benefit from program activities. This limits program effectiveness and reduces the ultimate goal of providing viable livelihood opportunities in communities affected by crisis. Understanding the affected market systems and marketplaces is a critical step and is covered in the Assessment and Analysis Standard, as well as the MiSMA.

On the other hand, economic recovery activities should target groups or individuals that are capable of sustaining and expanding their economic activity into the future. Should vulnerable groups lack the ability to sustain an activity, they are best served if, in addition to livelihood support, they receive cash transfers and other social safety-net interventions as well as capacity-building to build skills for the future. Such supplemental interventions should take into account the specific needs, capacities, and risks of sub-groups (e.g. women, people with disabilities, non-conforming gender identities and sexual orientations) to ensure inclusion, protection, and efficacy.

(3) Market distortion

Despite the best intentions, many emergency or development interventions can create market distortions. Market distortions include any unintended results that negatively affect a market system, ranging from extreme price fluctuations to the physical destruction of a market. It is the responsibility of those intervening in crisis situations to ensure that their interventions do not replace local products and actors, or otherwise create harmful distortions. Interventions should create positive effects beyond their intended economic targets, for example outcomes that empower women.

The primary objective of activities is to help local markets recover and support them to serve affected communities; however, caution should be taken with any activities that have the potential to distort markets or adversely affect communities, whether in the immediate or long term. Interventions that include local procurement and support local businesses can be designed to mitigate the risk of market distortion as well as help ensure the goods are culturally appropriate and meet local tastes (see also Asset Distribution Standards). Collecting and analyzing market data in a timely manner during the interventions can ensure local procurement and other activities do not create market distortions. One market distortion warranting special attention is corruption. While corruption exists in many markets, not just post-crisis markets, it is important that programs are aware of it and take proactive measures against it, rather than reinforce or allow it to flourish. This can also help reduce potential conflict.

(4) Responding to changing market conditions

Markets are dynamic, particularly in crisis environments. Ongoing monitoring of the market system and the targeted enterprises or households will help identify emerging opportunities or constraints. Regular monitoring will also help interventions determine how best to adjust project investments (such as time and funding) for the greatest impact. Effective strategies can range from tracking changes in the availability of services and inputs that are critical to small farmers, to local price monitoring and meetings with regional wholesalers, to more complicated tracking of regional and international commodity prices and trends (see also Assessment and Analysis Standard 1).

Core Standard 2

Efforts are coordinated to improve effectiveness

For maximum efficiency, coverage, and effectiveness, interventions are planned and implemented in coordination with the relevant authorities, humanitarian agencies, civil society organizations, and private-sector actors. Coordination is internal and external.

Key Actions

• Determine if an analysis of the stakeholder environment in the affected area has been done. The analysis may include transporters, government actors, producer cooperatives, labor unions, and warehouse collectives. If not, consider conducting one to better understand who should be included in coordination efforts, looking at their capacities, power dynamics, and which actors are marginalized or excluded.

• Review the market regulatory framework, if it exists.

• Be informed of the responsibilities, objectives, and coordination role of government authorities and other relevant coordination groups.

• From the outset, participate in existing coordination meetings with local, national, and international actors, and avoid creating new structures where possible. Use these groups to undertake joint assessments, disseminate findings and other relevant information, and/or formulate intervention strategies and programs.

• Provide information about the agency's mandate, objectives, and economic recovery programs to the relevant coordination bodies and local stakeholders.

• Look at the enabling environment, government policies, and program objectives to determine if an advocacy strategy is needed to achieve programming results. Collaborate with other implementing agencies to strengthen advocacy on critical issues.

• Clarify agency practice regarding coordination and partnerships with the private sector and other actors in the response.

Key Indicators

• There is no duplication of interventions and programs among agencies in the same geographical or sectoral areas.

• Programs regularly exchange assessment reports and information with donors, implementing agencies, government stakeholders, local leaders, other humanitarian actors, and the private sector.

• Commitments made at coordination meetings are acted on and reported back in a timely manner.

• Organizations, programs, and projects that either cannot address identified needs or are unable to meet the minimum standards make gaps known, so that others may assist.

• An organization's response strategy reflects the capacity and plans of other humanitarian agencies, civil society organizations, and relevant authorities.

• Asset transfers and distributions are coordinated, sequenced, and aligned with the local economy to avoid responses undermining each other.

• An information-sharing mechanism between stakeholders is in place.

Guidance Notes

(1) Coordination mechanisms

Uncoordinated responses lead to duplication, inefficiency, and potential conflicts in project strategies and interventions. This is particularly critical in economic recovery programs where different organizations' programs may undermine each other if they do not coordinate. An example of this is where agencies in the same geographical area or location provide grants and loans to the same target group for the same purposes, but at different rates and with different conditions. Lack of coordination may also burden disaster-affected people if multiple teams demand the same information for market assessments, when this information could instead be shared across agencies. Collaboration optimizes resources: a coordinated effort by communities, host governments, donors, and humanitarian agencies with different mandates and expertise maximizes coverage and quality.

(2) Coordination roles

It is the primary role and responsibility of the government of the affected state to respond to and coordinate humanitarian responses from assisting organizations. Humanitarian agencies play an essential role by supporting governments and respecting their coordination function. In some contexts, however, government authorities (and some civil society groups) may themselves be responsible for abuse and violations, or their assistance may not be impartial. In this context, a response coordinated with parties involved in the conflict may be inappropriate. Where the state is willing, but lacks capacity, humanitarian agencies should assist the state in fulfilling their responsibilities. In these contexts, sharing information across all sectors, as rapidly as possible, will enable agencies to respond to the needs of the affected population more quickly and effectively. Common forums for international NGOs to share such information include UN-led groups, such as the Office for the Coordination of Humanitarian Affairs (OCHA) and the Humanitarian Information Center, and cluster meetings for UN-declared emergencies. Coordination mechanisms may be monthly or quarterly meetings, an email listserv, the 4Ws (who, what, when, where) or an NGO forum.

(3) Transparency on targeting

Tensions can be high in crisis and post-crisis situations. Efforts must be made to effectively and openly communicate with all stakeholders. This can be done through transparent mechanisms, such as community meetings or local committees. Information about programs, decisions, and participation opportunities and criteria should be shared with all those affected by the crisis. Sharing information helps reduce misunderstandings, particularly when the program provides resources to only some people or provides a service that is new to the community.

(4) Transparency on approach

Organizations working with the private sector should articulate their policies clearly to communities and other stakeholders. The needs of those affected by crisis are significant, and stakeholders may not understand or perceive how partnerships with the private sector can address the livelihood needs of those most affected by the crisis. Transparency and disclosure of why organizations partner with the private sector and other local actors, including commitments and potential gains, will reduce misconceptions of different partners' roles in the program. Humanitarian organizations working with private-sector actors should build on the work of the task force on Protection from Sexual Exploitation and Abuse (PSEA) and enforce data protection that protects program participants. Protective measures should be formalized within standard operating procedures and contracts and regularly monitored.

(5) Making gaps known

When gaps in programming are identified and shared with other responding agencies, agencies with the appropriate technical expertise and/or spare capacity can more easily fill the gap. Timely information sharing about project locations, involvement of local partners, and emerging needs should be promptly communicated to the appropriate coordination bodies. The response coordination could be done through existing mechanisms (such as cluster or interagency) and aimed at identifying gaps, resources, and new partnerships.

(6) Pricing, wage setting, and valuation of transfers

For interventions where assets are given to individuals and targeted groups (such as cash transfer programs, cash for work, distribution of equipment, and vouchers), the value of the distribution should be in line with Sphere standards and based on an analysis of current market prices and household needs. These values should be openly coordinated among donors and implementing agencies, and in line with government policy where required, so that there are no distortions in terms of prices or crowding out of existing private-sector providers. Equitable principles should also be followed in setting labor rates. Setting cash-for-work wages must take into consideration the local labor market in order to avoid increasing economic disparities and their social consequences, and to prevent 'poaching' or luring away workers from lower paying, but more sustainable, work. (See also Asset Distribution Standards and Employment Standards.)

Core Standard 3

Staff have relevant skills

Programs are staffed by individuals who understand economic recovery principles and/or have access to technical assistance. Programs include capacity-building components to improve the relevant economic skills of staff.

Key Actions

• Develop human resource (HR) systems that enable the organization to access competent talent with relevant experience for economic recovery responses. When appropriate staff cannot be identified, consider partnering with an agency that has the required skill, rather than implementing directly.

• Ensure mechanisms exist for networking and knowledge-sharing so lessons from each crisis environment can be learned by others in the organization.