Equilibre

By aredien© 1993 All wars produce profits for a select group of companies, most of whom either participate in the bloodshed, by producing weapons and munitions, or in cleanup and reconstruction, such as building companies and pane glass suppliers. However, French Catholic entrepreneur Alain Michel has found a more Christian way to cash in on the escalating violence in the Balkans and eastern Europe. His Lyon-based company, EquiLibre International, transports merchandises and people to war-ridden countries and other ill-fated places often lacking such services. It's true that most humanitarian missions in places like Bosnia and Nagorno Karabakh are non-profit, but EquiLibre International has found a niche as a profitable supplier to non-profit companies. Its major task, accounting for 60% of revenues, is to carry humanitarian supplies for EquiLibre, Mr. Michel non-profit association that provides emergency relief principally in Bosnia, Croatia and Romania. Yet EquiLibre International also counts the U.S. State Department Office of Foreign Disaster Aid (OFDA), the EC, and private companies such as Creusot-Loire as clients. Mr. Michel's calling into humanitarian assistance came in 1984. Owner of an equitation and restaurant complex at that time, Alain Michel wasn't particularly inclined toward working for charity organizations, but a close encounter with poverty and suffering changed everything. A priest he knew in Lyon asked for his help in transporting medical equipments to a Polish pediatric hospital lacking the basics to keep its patients alive. ``I couldn't ignore what I saw there,'' says Mr. Michel, ``The doctor had so few supplies that he had to do perfusion on newborns with used adult disposable syringes that nurses had sharpened on whetstones. In the process so many diseases were transmitted that and only 10% of the babies in the hospital made it.'' When the charismatic 49 year-old restaurateur returned to France, he set up an association to transport aide to Poland and the pediatric hospital. He called it EquiLibre, or Balance in English, because of the equilibrium that he wanted to develop between richer nations and lesser ones. The non-profit EquiLibre multiplied its actions and countries of intervention. Convoys delivered food and other emergency supplies to Armenia after the 1988 earthquake, to Romania, to Lebanon. Mr. Michel says that once he begun organizing the firsts humanitarian convoys he became so morally and financially tied to the system he had started that it was impossible for him to stop and go back to his former profession. ``I had borrowed money to buy aid and I had to organize fund-raisers to pay it back. I gave TV shows and organized concerts to raise money. The more EquiLibre became known, the more people asked me to organize missions. The process fed on itself.'' For seven years, the association financed its own humanitarian operations. It paid for the trucks' leases by renting the side panels of the vehicles to advertizing agencies. In 1992, however, Alain Michel met Michel Plouzennec, a 36 year-old trucking company manager. ``I was looking for meaning in my life,'' says Mr. Plouzennec, ``I had been working for 14 years and was starting to wonder what I was working for.'' Mr. Plouzennec wanted to do volunteer work for a while. "I thought I would do my humanitarian good-deed and feel better after it.'' Instead he and Mr. Michel decided create EquiLibre International, a profit-making transport company headed by Mr. Plouzennec. Since EquiLibre International reinvests all of its profits in the association EquiLibre, the transport company remains a non-profit venture. However according to Mr. Michel its creation was necessary. ``In order to get a trucking company's license in France we had to be recorded on the register of commerce, something an association cannot do,'' he says. Moreover, a for-profit company, unlike a non-profit company, can recover the value-added tax it pays on its commercial operations. So Alain Michel took advantage of a 1985 French law authorizing a limited-liability company to have only one shareholder and started a for-profit company, EquiLibre International, whose sole shareholder is the nonprofit association EquiLibre. As a profit-making company, EquiLibre International can recover the VAT it pays. People familiar with EquiLibre and Mr. Michel himself think of the association and the enterprise as a whole since one couldn't exist without the other, although they are clearly separate in the law. Feeling quite comfortable about mixing business with charity, he says ``Yes we make a profit out of humanitarian actions but as long as this business is clean, I see no problem with making money since all of it is reinvested in EquiLibre,'' he says. According to Mr. Plouzennec his business is stainless indeed. ``We have an ethic, you know. We cannot accept to transport just anything and certainly not weapons.'' Working principally for EquiLibre doesn't keep Mr. Plouzennec from stopping in Germany to load in vegetables on its way back from Poland or in Croatia for construction materials freight after a mission in Romania. War in Ex-Yugoslavia projected EquiLibre among the top largest European non-governmental organizations (NGO), together with more widely known associations like Medecin du Mondeand Medecin sans Frontiere. The notoriety EquiLibre gained through self-financed humanitarian missions brought businesses to EquiLibre International as private charity associations and institutions such as the EC called on EquiLibre to organized and transport emergency missions. Among others, the French association Reporters sans Frontieres (Without Borders) hired EquiLibre to transport 80 tones of newsprint for the Oslobodenje (Liberation) newspaper in Sarajevo. The Office of Foreign Disaster Aid (OFDA) also asked EquiLibre to transport 2500 tones of food, medicines, and clothes to Bosnia during the next four months. Eveline Rivoallon, director assistant of Creusot-Loire Industrie, a unit of Usinor-Sacilor SA, says her company decided last winter to ``do something'' for one of its clients in Sarajevo. ``I choose EquiLibre because of its good reputation,'' she said. The company hired EquiLibre to bring provisions to the employee's families. ``We are going to call EquiLibre again at the end of the year to send another convoy,'' she said. EquiLibre International, created Jan. 1, 1992, expects its 1993 profit to jump to 18 million francs ($3.1 million) from 9.5 million francs in 1992. The truck fleet grew to 11 trailers this year from six in 1992. In addition the group owns 23 smaller trucks, 12 vans and 1 bus. But the humanitarian enterprise's concept doesn't appeal to everyone. Medecin du Monde Director Pierre Pratier says condescending, ``I won't says that we can't stand them, but like us when we started EquiLibre is often improvising and lacks professionalism.'' Bernard Coq a French journalist who wrote a book on humanitarian organizations in Ex-Yugoslavia says, ``Because In Bosnia EquiLibre's trucks are always well guarded people wonder what they transport and since it is still a young organization other NGO are suspicious.'' He adds that for NGO such as Medecin du Monde EquiLibre International's profit making effort isn't appreciated. ``Making money out of charity is a sensitive issue and it's only normal that people get suspicious about it. That is why we keep our records open to those who ask,'' says Mr. Michel. Alain Michel says he is paid 20,000 French francs a month ($3,454), doesn't drive a company car and doesn't have a expense account. At the beginning religion wasn't the driving factor in Mr. Michel humanitarian effort, but today he says ``it helps me to go beyond my limit and to keep faith in my work. I go to mass more than just once a week,'' he says. In 1993 the restless humanitarian entrepreneur surpassed himself. First, at home where he developed new marketing technics. Then, abroad were he has diversified beyond transport into other areas. With the advice of Jean-Louis Baron a successful textile businessman, Alain Michel launched a mail order service to sell products displayed in the non-profit association's monthly. In Presence Dans Le Monde, the association's magazine, members can choose among other products, between brut or rose's special ``Cuvee de L'Espoir'' champagne. The add praising the exquisite taste of the wine tells the readers that for each bottle sold 70 French francs ($12), 10 French francs ($1.7) are used for EquiLibre actions for the children. ``Buy the champagne of hope and share the joy of your celebration with kids suffering from hunger, waror illnesses,'' reads the add. Mr. Michel however did forget his humanitarian duty, ``Alcohol is dangerous for your health, drink with moderation,'' he warns. Mr. Baron was among the initiators of a placement fund recently made to members through the the association. ``Instead of the usual donation we give people the opportunity of placing their money and to keep the interests.'' EquiLibre works with an investment company and suggest placements in mutual fund to interested members. EquiLibre receives 0.4% of the investment company's management fee. Mr. Baron expects the pay off from this service to soon become very profitable. Jean-Louis Baron was EquiLibre's financial director for a year before leaving EquiLibre to start his own humanitarian enterprise last August. He came to EquiLibre after his wife and two daughters were killed in a car crash during the summer 1992. His life was falling apart, he says, ``I was questioning my goal in life and wanted to stop doing business. Then, I remembered my friend Alain Michel. We were boy scout together. With EquiLibre I used my entrepreneurial skills for a humanitarian purpose.'' Mr. Michel explains EqiLibre success by the fact that people are becoming increasingly aware that ``We are all players in the world crises. Now people want to get involved,'' he says. Mr. Baron adds, ``People and companies hire EquiLibre because they feel that they are contributing to a good cause.'' Although EquiLibre's humanitarian/enterprise relationship is unique in Europe, other non-profit associations are heavily relying on sponsoring and marketing to finance their actions. UNICEF has been using TV and mailings for a long time. Others use the charity promotion concept. A portion of a product's price is redistributed to the charity organization partner. Benetton works with Caritas for example, Agfa with UNICEF, Neutrogena with Pharmaciens sans Frontieres. However, according to other NGO no one but EquiLibre has been so far in combined charity and business into a profit-making venture. Present in 12 French cities and 17 foreign countries EquiLibre has become a major player in humanitarian emergency missions. But for Alain Michel his success is only ``a drop of water in the ocean,'' he says. ``We are facing situations more and more depressing and dramatic.'' This, however, doesn't keep the enthusiastic enterpreneur from starting new projects. Always ready to tackle desperate situations Mr. Michel believes that family farms are part of the answer to world starvation. Inhis new agriculture school in Lyon, students learns the farming technics they will then teach people in countries where cultivation methodes are inadequate. In the meantime, Alain Michel says he ``finance the school with the sell of the organically grown vegetables we produce,'' he says.