The Palais des Nations in Geneva, Switzerland. United Nations agencies remain an integral part of the Geneva aid amalgamation, but it appears several agencies are seeking greener, more budget-friendly pastures for back-end operations, especially. Photo by: United Nations

Geneva has experienced an exodus of United Nations staff in the last few years, with multiple agencies slimming down their operations in search of cheaper climes. Rumors continue to swirl in the press and among industry insiders that further U.N. functions will soon find their homes outside the Swiss city, which hosts approximately 40 agencies — some dating as far back as 1948 — and 9,500 staff members altogether.

The next big move could be the result of Umoja — a multiyear enterprise resource planning project  to consolidate U.N. information technology and administrative systems, which would put every agency and program on the same platform and combine information technology support staff in the same place. However, that place may not be Geneva.

“There is a realistic chance that some of [these relocations] could happen because the short-term considerations of cost are swaying things,” said Ian Richards, executive secretary of the U.N. office at Geneva’s staff council, adding that this could affect hundreds of jobs as well as the economy in the Geneva region. “But that is very hypothetical at the moment.”

Despite years of speculation that Geneva’s sparkle as an aid hub is dulling, organizations from all over the world still call the cosmopolitan city home. In fact, “No other place hosts a more concentrated network of international and nongovernmental organizations, diplomatic missions and world-class academic institutions,” Anne Monnerat at the Presidential Department of the Republic and State of Geneva, told Devex in an interview earlier this year.

Find out which organizations make the Swiss city the hub that it is:

Top Geneva global development NGOs: A primer

U.N. agencies remain an integral part of this aid amalgamation, but the Economist’s 2015 Big Mac Index names Switzerland the most expensive country in the world — a fact not overlooked by agencies looking to save on operational costs. The case can be made to move operations elsewhere to satisfy tight budgets — and most likely will be when it comes time for candidates to bid for the position of secretary-general — but others argue that a narrowing gap in living standards between developed and developing countries leaves Geneva standing strong as the aid hub of choice.

For back-end operations especially, though, it appears many organizations are seeking greener pastures.

Already the World Health Organization has moved some of its back-end operations, such as the Global Service Center, the procurement functions as well as the Department of Information Technology and Telecommunications to Kuala Lumpur, Malaysia.

The Office of the United Nations High Commissioner for Refugees shifted much of its operations to Hungary and London, and most recently sent its fundraising department to Copenhagen.  Earlier this year, the Office of the High Commissioner for Human Rights started to restructure its headquarters and strengthen its regional offices, which sent some 50 positions into the field from Geneva, according to Richards. He added that several countries, like India, are bidding to move the International Telecommunication Union headquarters out of Geneva as well.

Most notable is the U.N.’s current process of consolidating its information technology system — putting every agency and program on the same platform with support staff in the same place — in the enterprise resource planning project dubbed Umoja, which means unity in Swahili.

The project, which launched in 2006 and is planned to be released by 2018, will save the U.N. between $140 and $220 million by 2019, according to the U.N. General Assembly’s fifth progress report. Though Richards mentioned Bangkok and Nairobi as potential locations when speaking about the new IT system, no firm decisions have yet been made about where the hub will sit.

Within the next two or three years, contingent on the success of rolling out Umoja, it’s likely the U.N. will also consolidate its human resources, payroll and finance operations in a location other than Geneva, though this is where many of the agencies have kept these functions until now, Richards explained.

But there is likely to be greater pressure from donor countries as well on U.N. leadership — particularly effective with the selection of a new secretary-general on the horizon — to move administrative staff out of Geneva to cut costs.

This would mark a huge shift, as the U.N. currently consolidates itself around certain issues — trade, humanitarian aid, environmental issues and human rights to name a few — in one location to enable the transfer of knowledge, people, skills and ideas in a given situation. If too many people were scattered, there would be a reduction in important economies of scale, which may lead to inefficiencies for the organization in the long run, according to Richards.

Though Umoja translates to more money in the bank, there is still something to be said for having administrative and IT facilities in the same place as the people they serve, Richards said.

“I think some of the agencies have budget issues, so instead of looking at the long-term, they are looking at very short-term budget alleviation,” he said.  

It would make more sense to consolidate administrative service centers in Geneva rather than send them elsewhere — “partly because you have such economies of scale in Geneva, and also because there is always better service when the people who are administering the contracts, the finances and the payroll are based in the same place as the different departments that they’re serving.”

“We feel that this is a great opportunity, as Geneva is still the largest U.N. duty station, once you take into account all organizations and agencies,” he said.

Geneva ties

Realistically, running projects and activities make up about 80 percent of the work of the U.N., while administrative tasks about 20 percent. The substantive functions or main undertakings of each agency will likely remain in Geneva. For humanitarian and trade issues in particular, the advantages of concentrating expertise and resources would make it very difficult to move those staff elsewhere.

“There is an immense effort in keeping people here. Agencies, funds, programs and NGOs all recognize the significance of being in Geneva,” said Ahmad Fawzi, director and chief spokesman of the U.N. Information Service, adding that Geneva is the humanitarian hub of the U.N.

“There is no denying that much of the work that is done here, or most of it, affects people all over the world,” Fawzi said. “So the work that is achieved or developed, whether it’s technology or health or aid of any kind or inventions or standards or rules, emanate from Geneva.”

It’s apparent, though, that there is a difference in approach among different agencies. At the same time UNHCR has moved some of its operations to Hungary, for example, UNOG is working to consolidate administrative services in Geneva.

“It is complicated actually, because the U.N. is itself a global organization. But the question is to what extent do they look at infrastructure, business continuity, and to what extent are they looking at costs? To what extent are they looking at the proximity to the communities that they are trying to serve? These are all questions that need to be looked at,” Richards said.

“Geneva is important because everyone is here. And you see that those who want to move some administrative hubs to Bucharest or Bangkok will not liquidate their presence entirely, because they recognize that they need to be here and the reason is always that everyone else is here,” explained Fawzi.

However, understanding that the bottom line is a strong motivator, a number of ideas are being thrown around by the U.N. administration, including having different entities share buildings or using the park that was built for the League of Nations between 1929 and 1936 before the U.N. secretary-general signed a headquarters agreement with the Swiss authorities in 1946 that brought UNOG into being.

There’s talk of agencies like UNHCR, for example, relocating to the Palais de Nations compound.

The Strategic Heritage Plan, a 10-year scheme to renovate the Palais des Nations and the neighboring Ariana Park, began planning and design phase two years ago. The renovation would be paid for by U.N. member states once the budget has been approved by the General Assembly.

“Imagine the savings that can be achieved if something like that happens,” Fawzi said.

“They call it [the U.N.] a talking shop and they don’t call it a talking shop for nothing. We do a lot of talking, but I think a lot of good comes out of the talking. And talking is better than fighting — as we always say.”

Beyond sharing conference facilities, he also mentioned having agencies share technological capabilities: IT communications, telecommunications, even scanning and photocopying.

“There are many creative ways to cut costs,” Fawzi said.

A political move

The position of U.N. secretary-general, currently held by South Korean Ban Ki-moon, will be up for election in 2016. For some of the more powerful donor countries that will lobby for their preferred candidates, budget concerns are important. It is likely that certain executives will try to please those countries by examining low cost solutions in order to gain support to run for secretary-general, mentioned Richards.

“The time when you could say that the gap between developed and developing countries was huge, I think that’s past,” said Richards. When you look at big developing countries hosting or hoping to host U.N. organizations there is no longer a great gap in living standards and wages as there once was and the gap between these types of economies is rapidly narrowing.

“I think in the long-term costs and wages are going to rise in a number of these duty stations, so the gap between Switzerland and the others is going to reduce quite significantly. I think we have to look at that,” said Richards.

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About the author

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    Aliyah Esmail

    Aliyah Esmail is a freelance journalist and communications professional with a fascination for the economic and political realities facing nongovernmental organizations. She holds a bachelor’s degree from Carlton University in journalism and film studies and is now working on a postgraduate certificate from the Humanitarian and Conflict Response Institute in Global Health. She has worked for the government of Canada as well as a number of international organizations.