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HIV/AIDS
Business Must Do More
Prepared for the HIV/AIDS Colloquium
Hosted by Eskom Holdings Ltd
By Carol O’Brien
The Global AIDS Crisis
AIDS is the worst health crisis in all of human history
30 million people have died
Source: UNAIDS, AIDS Epidemic Update 2005
Total: 40 million Adults and Children living with HIV/AIDS at the end of 2005
Western Europe610 000610 000
North Africa & Middle East540 000540 000
Sub-Saharan Africa25.4 million25.4 million
Eastern Europe & Central Asia1.4 million1.4 million
South & South-East Asia
7.1 million7.1 million
Australia & New Zealand
35 00035 000
North America1 million1 million
Caribbean440 000440 000
Latin America1.7 million1.7 million
East Asia & Pacific1.1 million1.1 million
Global Epidemic Overview
The Global Business Coalition on HIV/AIDS
The GBC is perhaps the most important coalition that we have operating on the face of the earth today.
-Colin Powell, Former U.S. Secretary of State
Mission: To harness the power of the international business community to end the HIV/AIDS pandemic
Membership: The GBC is a coalition of almost 210 International companies from a diverse range of industries
Leadership: Ambassador Richard Holbrooke, CEOMark Moody-Stuart, Chairman Anglo AmericanBertrand Collomb, Chairman LafargeCyril Ramaphosa, Chairman, Shanduka South Africa
GBC Overview
Helen’s Legacy
C a rl
S am
S ue
Joel T im
JG Ja m es T o m
S h irle y C in d y
A nton B il l
L ily L inda
V a l
D e on
D en
T o m
E va
S im on
H e len
HIV/AIDS Affects Business
Why should business take action against HIV/AIDS?
• Macro-economic
• Socio-economic
• Your company : direct and indirect costs
AIDS Decimates Economies
-1.6
-1.4
-1.2
-1
-0.8
-0.6
-0.4
-0.2
0
0 5 10 15 20 25 30 35
HIV Prevalence Rate (%)
Red
uct
ion
in
gro
wth
rat
e G
DP
p
er c
apit
a (%
, p
er y
ear)
Source: R. Bonnel (2000) Economic Analysis ofHIV/AIDS, ADF2000 Background paper, World Bank. Slide adapted from UNAIDS: “Socio-Economic Impact of HIV/AIDS in Africa,” presented by Anita Alban and Lorna Guiness, ADF 2000.
Growth Impact of HIV (1990-97) for 80 developing countries
• Health consumes more of government budget• Declines in family savings and disposable income • Shorter Horizons reduce investment information and networks • Foreign investment and tourism decline• Tax revenues fall• Skilled workers & professionals die or flee: brain drain• Decrease in demand for specific products
Socio-Economic Impact
• group life cover and disability cover
• medical benefits
• retirement benefits
• cost of absenteeism (usually significant)
• cost of recruitment and training to replace employees who retire due to ill-health or died in service
• cost of compassionate leave, including time to attend funerals of colleagues and family members
• Credit risk for those businesses providing credit to customers and employees
Your CompanyIncrease in Direct Costs
(More difficult to quantify as these costs increase expenditure and reduce revenues)
Include:
• Business risk
• Legal risk
• Reputation risk
• Accounting risk
Your Company - Indirect Costs
BUSINESS RISK
• Reduction in staff productivity / loss of workforce morale
• Increased supervision required (higher levels of absenteeism and less experienced staff)
• Increases in the cost of salaries where skilled staff lost
• Loss of ‘institutional memory’ or intellectual capital
• Loss of client relationships especially where the disease affects key persons
• Potential increase in non-Aids infectious diseases such as tuberculosis or influenza - may infect HIV negative staff
Your Company - Indirect costs
LEGAL RISK
• Increased litigation – discrimination
• Risk of vicarious liability for managers/fellow employees falling foul of HIV/AIDS laws
ACCOUNTING RISK
• Financial statements inaccurate - lack of information on HIV/AIDS exposure or risks inaccurately disclosed
REPUTATION RISK
• Bad publicity - inappropriate treatment of an HIV+ employee
• Public concerns about prevalence in certain sectors
Your Company - Indirect Costs
Is a mechanism to utilise existing business infrastructure to provide expanded access to HIV
prevention, testing and treatment to the communities in regions heavily impacted by
HIV/AIDS
Global Business Coalition on HIV/AIDS
Co-Investment
Combine Business interests of private sector with development goals of country or region
Key Elements
• Long term economic engagement in partner countries
• Substantial contribution by private partners
• Efficient distribution of tasks between different partners
• Achievement of developmental benefits
• Sustainability and long term effects
Private Sector contribution
• Expertise in running Work Place Programmes
• Existing infrastructure
• Business expertise
• Management expertise
Public sector contribution
• Policy development and regulation
• Leadership
• Financing
• Access to various development partners
• Overall co-ordination of HIV response
Accessing Financial Resources
Global Fund to fight AIDS, Tuberculosis & Malaria
• proposals via CCMs
• www.theglobalfund.org
World Bank
Multi-country HIV/AIDS Programme for Africa (MAP)
• $1 Billion to 32 countries in Sub-Saharan Africa
• Apply through NACS but process differs per country
•www.worldbank.org/afr/aids
PEPFAR
(President Bush’s Emergency Plan for AIDS relief)
$15 Billion
www.usaid.gov
Bilateral Development Agencies
•GTZ (German Technical Co-operation)
•USAID
•DFID
•Other
• Antagonism between public and private actors
• Lack of information / best practices
• Complexity of donor procedures
• Fear of financial liabilities (limited time horizon of donor support)
• Lack of trust (main barrier on part of government)
Barriers to co-investment
Business must do more
“Our company does not have any AIDS related products, therefore we have decided not to be involved in the issue”
“Our local stores and employees are involved in a variety of important causes but HIV/AIDS does not fall within our focus areas”
“Our company does not have employees in Africa, India or China”
“We employ primarily white collar workers so its not an issue for us”