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The Vietnam News

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Using your head

A charitable organization hopes its for-profit subsidiary that makes motorcycle helmets can reduce Vietnam's traffic-related deaths and change the way charities do business

HANOI - In Vietnam, a country quickly adapting its old, Soviet-style economy to the market, the rules of business are still being written. So, too, are the rules of philanthropy.

Changing habits and charities

- There are about 35 daily traffic-related deaths in Vietnam
- The death toll would drop if more motorcyclists wore helmets
- A charitable organization has set up a for-profit subsidiary to make low-cost helmets
- So far, about 23,000 helmets have gone to school-age children

A United States charitable foundation is tackling a very Vietnamese problem--the staggering number of traffic deaths caused by helmetless motorbikers plying the country's chaotic streets--in an unusual way: establishing a for-profit subsidiary to actually manufacture low-cost helmets here.

That makes the four-year old charity called the Asia Injury Prevention Foundation, or AIPF, run by a former American business consultant, more than just your average philanthropy out soliciting donations for bike helmets or scaring up funds for public-education campaigns.

A glance at the numbers suggests the Vietnamese helmet business should be a no-brainer. Government estimates put the number of traffic-related deaths in Vietnam at nearly 35 a day; there are almost three times as many injuries. "It's the equivalent of a jumbo jet falling out of the sky every nine or 10 days," says John Kilgour, an executive with energy-provider BP Southeast Asia who lives in Ho Chi Minh City.

But most Vietnamese bikers, who far outnumber drivers of cars, say they find traditional helmets too hot for Vietnam's stifling climate and just unnecessary. Now, Kilgour and other Asian business people are experimenting with a riff on the familiar models of philanthropy to change those perceptions and reduce the fatalities, which are rising in lockstep with Vietnam's rapid economic growth and modernization. AIPF's helmet subsidiary, Vietnam Safety Products and Equipment--with backing from big corporate donors--stamps out its specially designed, hot-weather headgear from a spotless factory near Hanoi's airport. It then sells the product in a few stores and supermarkets. The retail cost? Usually about $10 a helmet, a below-market price designed to encourage people to wear the protective gear.

The company, commonly known by its brand name, Protec, also donates thousands of helmets to Vietnamese schoolchildren under a programme called Helmets for Kids. Donor corporations agree to foot the bill and cover the company's costs--and sometimes get their names emblazoned on the back of the pint-sized helmets. AIPF's success so far is hard to measure, and the privately held Protec won't reveal specific financials. Anecdotally, it's still rare to see helmets on the streets. And the charity will surely face problems raising more money, with all philanthropies suffering from reduced donations these days due to bad economic conditions.

But Protec should be able to plough any profits it makes back into AIPF's core cause of providing helmets and educating the masses and, someday, perhaps even stop asking for donations. "We've created a self-sustaining model here," says Greig Craft, who founded AIPF and incorporated it in the U.S. as a not-for-profit group. Protec "is an actual business," he emphasizes, even though its goal isn't enriching shareholders. The energetic and bespectacled Craft, well-known in Hanoi's burgeoning expatriate business community, remains the president of AIPF and sits on Protec's board. His operational chief is Do Tu Anh, a former business partner of Craft's who oversees Protec and serves as the executive director of AIPF.

Business people like BP's Kilgour and Dan McHugh, an international shipping executive and AIPF board member, say AIPF's set-up makes the charity more efficient. It can be "very, very difficult to move the needle" and get things done on a not-for-profit board, says McHugh, an executive vice-president with APL, part of Singapore shipping outfit Neptune Orient Lines, which does business in Vietnam. But AIPF was able to make the decision to build the Protec factory very quickly, he says, and get the plant constructed in less than a year. McHugh says he is comfortable there are no conflicts of interest in the relationship between AIPF and Protec, a U.S. company that pays taxes in Vietnam. Indeed, some other U.S. not-for-profit organizations own profit-making companies, though they sometimes receive extra scrutiny from donors. The concern is usually that "things are being done in the best interests of the recipients of the [charity's] services," and not those who could profit from the business, says Daniel Borochoff, president of the watchdog American Institute of Philanthropy in Chicago.

Craft, who says he has retired from his consulting business, says Protec's sole mission is increasing helmet use in Vietnam and raising awareness about road safety. But "to really modify the behaviour of an entire nation is an expensive proposition," he says. It is a cause Craft takes personally. Driving in a car from downtown Hanoi to the Protec plant in the Noi Bai industrial park, he spies a woman driving a motorbike with a small child perched on her lap. Neither was helmeted. "You just want to reach out the window and shake them," he says. Craft also believes Vietnam's dismal record in road safety is holding it back economically. The huge number of accidents places a big burden on the country's public-health system, he says, and propagates poverty when heads of households are killed, or maimed and left unable to work.

But the helmet cause was rough going at first. Craft's charity initially discovered that few Vietnamese wanted to wear large, traditional motorcycle helmets, which they referred to as "rice-cookers," because of the country's intense heat. Those helmets can also impair vision and hearing--a bad thing on Vietnam's roads, where most drivers signal movement by honking. AIPF then began importing smaller, hot-weather helmets from overseas, but those proved too expensive for the Vietnamese market. Many also didn't fit properly, Craft says. Then came the idea for the Protec factory. In the first eight months since it opened in May, the plant has churned out about 35,000 helmets. About 23,000 of those have gone to schools.

Hip helmets

So far in Vietnam, there doesn't appear to be much grousing from other bike-helmet manufacturers about Protec's low-cost product, or the company's link to philanthropy. That may be because helmet buyers in Vietnam remain scant right now.

But Protec is doing its best to distinguish itself from the competition: It is trying to make helmets more fashionable by churning out models in bright colours, including some with rainbow stripes and others with pink dots on a lime-green background. "We want the stewardesses on Vietnam Airlines wearing them. We want the models," says Craft. That may be a tall order. But AIPF has at least taken steps toward building a new model of philanthropy, and one Craft hopes can be adopted by other nations in the region.

By Rebecca Buckman & Margot Cohen - The Far Eastern Economic Review - March 27, 2003.


Want a job in this factory ? Wear a motobike helmet

Chu Anh Tho manages the 65 workers at the Vietnam Safety Products and Equipment factory, the company owned by the Asia Injury Prevention Foundation, or AIPF, that stamps out much-needed motorbike helmets for this bike-crazy country. But that doesn't mean he's got an easy task convincing anyone--even his wife--to actually wear the company's products.

In Vietnam, "it's not fashionable" to wear a helmet, says Chu, who admits that even he often rode helmetless before he took the job at the factory last year. His wife, he says somewhat sheepishly, will only wear protective headgear if it matches her motorbike. (Her current favourite colour combo is silver.) Chu has an easier time taking charge at the factory, known as Protec for the brand of helmets it products. On one recent Saturday, scores of Protec workers clad in bright blue and red uniforms were busy with various tasks, from cutting small holes in new, royal-blue plastic helmets--later to be covered in black mesh--to stamping out the black bottom shells that will be fitted onto the helmets later. A layer of expanded polystyrene beads under the plastic provides most of the protection to wearers.

Two workers in a small paint shop were busy using a machine to carefully paint the logo of oil company BP--a major AIPF supporter--onto the backs of scores of forest-green helmets. The gear will be donated to children at a Vietnamese school. There is even an $80,000 helmet-testing lab, where 26-year old Le Hong Hanh uses special equipment to test everything from the strength of helmets' chin straps to the gear's ability to withstand side-impact collisions. Le says she now wears a helmet when she rides her motorbike--in fact, helmet use is mandatory for all the employees at the factory, who earn about $40-50 a month. The cheap labour, and lower distribution costs tied to having the factory near downtown Hanoi--instead of outside Vietnam--allow AIPF to charge below-market costs for the helmets, which are extremely light and small. Right now, says AIPF President Greig Craft, "we're covering our costs."

By Rebecca Buckman - The Far Eastern Economic Review - March 27, 2003.