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CORPORATE SOCIAL RESPONSIBILITY |
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| The AIDS epidemic today is unparalleled
in the challenges it poses to the world, and it is clearly an
issue that no one can address alone. Business is an essential
partner in the response to AIDS. The private sector like the
other sectors, is not immune from AIDS. But the private sector
is also in a unique position to respond to the epidemic, because
of its reach with employees and the wider business community.
Businesses have carried out broad programmes to reach out to
customers and local communities through cause-related marketing
and social investment initiatives. |
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| Involvement of the private sector
in the response to HIV/AIDS is crucial to the success of any
country's efforts against the epidemic. Businesses can mobilise
support in various sectors, give enhanced visibility to the
campaign to help keep HIV/AIDS on the international document,
and engender a holistic robust civil society response to the
HIV/AIDS epidemic. The role of corporate social responsibility
and active involvement of the private sector in the response
to HIV/AIDS epidemic has been gaining momentum in the region
in the last few years. While the impact of these achievements
has not been fully documented, there are signs that prevention
in the workplace can help reduce levels of HIV infection. |
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| IMPACT ON BUSINESSES |
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| For many businesses the impact of
HIV/AIDS is already severely constraining their ability to be
competitive, while for others the potential risks are significant
in both high and low HIV/AIDS prevalence regions. Building awareness
of the severity of the impact of HIV/AIDS on business is one
of the most important elements in assisting businesses to respond
effectively. |
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| More than 7 million people are infected
with HIV/AIDS in the Asia Pacific region, the great majority
of them persons in their most productive age. Every day, approximately
14,000 persons globally are newly infected with HIV. 6,000 of
these newly infected people are between 15 and 24 years old
who would constitute the future labour supply. In Thailand for
example, at least 670,000 people are living with HIV/AIDS, of
whom more than 85 percent fall in the most productive age group.
It is estimated that more than 50 percent of these persons are
employed in the private sector. HIV/AIDS directly affects the
social and economic development, both on the business level,
as well as on the national economic level. |
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| For the private sector, the implications
of AIDS are felt both at the micro and macro levels. The impact
on the workforce is felt in greater absenteeism, high turnover
and reduced productivity. At the macro level, AIDS affects the
environment in which businesses operate, including markets,
investment, services and education. According to a survey of
commercial farms in Kenya, illness and death have replaced old
age as the leading reason for employees to leave service. |
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| 1. Impact at the macro-economic
level |
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| The HIV/AIDS epidemic not only destabilises
societies and consumer markets, but also depletes human resources,
threatens occupational safety, pressures social protection systems
and undermines national investments. As it reduces business'
profitability, it has a potential negative impact on a country's
economic growth. |
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| In the long-term this has the combined
effect of reducing the market size for business, particularly
in markets outside of the basic necessities of food, housing
and energy, and reducing total resources available for production
and investment, and thus declining economic growth. Early results
of on-going estimates by the World Bank suggest that the macroeconomic
impact of HIV/AIDS may be significant enough to reduce the growth
of national income by up to a third in countries with adult
prevalence rates of 10 percent. Through higher morbidity and
mortality, no sector of the economy is immune to the impacts
of HIV/AIDS, particularly as a result of reducing the available
productive and skilled labour and investment. The combined effect
of this is to increase the broader service and production costs
to business. |
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| Businesses do not work in isolation
and so the impact of HIV/AIDS on all productive sectors, on
the business supply chains, the effective labour supply and
intellectual capital directly impacts on individual companies.
These impacts can significantly affect the ability of business
to operate. This may lead to a reduction in foreign direct investment,
discouraged by these potential production deficiencies exacerbated
by HIV/AIDS. There is a danger at a national level of governments,
fearful of a possible negative business response to their experience
of the epidemic, maintaining a policy of denial. |
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| There are limitations with macroeconomic
impact analysis, such as the unreliability of data on prevalence
rates and demographics. However, despite the lack of available
information on individual companies, it is much easier to identify
clear and substantive impacts. |
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| 2. Impact at the organisational
level |
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| Negative effects on the workplace
include: loss of skills and institutional knowledge, declining
morale among staff and potential workplace conflicts as a result
of stigmatisation and discrimination. |
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Besides these negative effects, serious
workplace disruptions occur, such as in:
- Cambodia, where fearful workers refuse to work with colleagues
rumoured to have HIV.
- Singapore, where uninformed supervisors terminate staff rumoured
to have HIV.
- Thailand, where production line stoppages occur due to fear
of HIV transmission.
- Asia, where compulsory HIV testing still is very common in
many companies, resulting in employee fear |
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Declining productivity and rising
costs
At the individual company level, productivity is reduced, due
to the loss of skilled and experienced workers. Profitability
is affected as a result of increased labour costs related to:
- rising absenteeism and early retirement;
- increased staff turnover;
- higher costs related to recruitment, hiring and training new
employees;
- higher health, life and safety insurance expenditure;
- increased medical expenses and funeral costs. |
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| Corporate Social Responsibility
in Asia Pacific |
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| As AIDS poses a significant threat
to human and economic resources in Asia, businesses look for
effective solutions to protect their interests. The need for
HIV/AIDS prevention in the workplace is eminent, especially
in emerging markets where public resources are constrained.
Working through the private sector to prevent HIV/AIDS is effective,
cost-efficient and sustainable. |
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| Sir Richard Skyes, Chairman of the
Global Business Council on HIV/AIDS said, "At the World
Economic Forum meeting at Davos in 1997, we recognised that
businesses couldn't operate in a vacuum. It has to engage the
real world. Businesses can also act as an advocate, helping
to keep AIDS on the international agenda, and thereby demonstrate
the benefits businesses can bring to society as a whole through
its products and as a corporate citizen in partnership with
the public sector." At the meeting, leaders from corporates,
international agencies and Governments came together to discuss
the contribution businesses can make. Nelson Mandela, the then
President of South Africa, headed the initiative. "Without
question, businesses must respond for its own good, and what
is good for them is invariably good for the community. In many
countries across the world, the epidemic is affecting the workforce,
markets and the overall business climate. Studies in Southern
and Eastern Africa conducted by the African Medical and Research
Foundation and for the US Organisations, AIDSCAP, reach the
same conclusion," adds Sir Skyes. |
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| The sentiment was echoed by the chairman
of the National Business Alliance on HIV/AIDS (NBA) Hadi S.
Topobroto at the opening ceremony of the Asia Pacific HIV/AIDS
Private Sector Mobilisation Workshop in Indonesia. He said that
with the large and increasing number of people living with HIV/AIDS,
"it will adversely influence our businesses, communities
and nation." Underlining the economic cost of the epidemic,
Hadi said a country where 15 percent of the population was living
with HIV/AIDS would suffer a one percent decrease in GDP per
year. "Let take South Africa, which has a high prevalence
of HIV/AIDS. It has been estimated the country will suffer a
decrease in GDP of up to 17 percent by 2010. This is a grim
picture, particularly for the private sector. Therefore employers
and company owners have the responsibility to protect their
workers from the spread of the HIV/AIDS epidemic," he said. |
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Corporates provide access to large populations
of highly productive workers who are between 25-49 years old,
an age-group that is especially vulnerable to HIV/AIDS.
Corporate resources, such as organisational structures and training
capacities, can with relative ease be utilised to fight AIDS. |
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| Management of HIV/AIDS in the workplace
prevents costs that are incurred by the growing AIDS epidemic.
Companies will thus perceive the tangible and intangible benefits,
such as increased workplace morale and positive corporate reputation
and employer's image, and continue what is good for their business. |
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Moreover, businesses possess a wealth of marketing
and management experience, and the drive to innovate and cross-boundary
organisation structures that have the potential to stop the
further
spread of HIV and address the needs of people living with AIDS. |
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| In the Asia Pacific region the corporate
social responsibility efforts against HIV/AIDS are on the increase.
There are many encouraging examples of CSR, public-private partnerships
and the private and corporate sectors demonstrating active roles
in prevention, care and support activities. The initiatives
by the Confederation of Indian Industry (CII) and the Indian
Business Coalition on AIDS (IBCA) in India, the Thailand Business
Coalition, an alliance of more than 100 companies, are some
examples. Promoting CSR in HIV/AIDS prevention, care and support
initiatives in the Asia Pacific region is one of the objectives
of the advocacy and communication efforts of the UNDP Regional
HIV and Development Programme. In partnership with other stakeholders
and private and corporate sectors, the idea is to create a regional
platform for fostering CSR in HIV/AIDS. |
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| Business
and HIV/AIDS: Who Me? |
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| Of the 7,789 business
leaders polled it was found (*): |
- Forty seven percent of firms felt HIV/AIDS is having or
will have some impact on their business, with firms more
worried about HIV/AIDS than tuberculosis or malaria.
- Most business leaders estimate lower HIV prevalence rates
among their workforce than UNAIDS figures for adult prevalence.
Firms that have conducted workforce prevalence surveys report
lower prevalence rates than those that have not.
- Twenty percent of the firms believe HIV/AIDS is or will
seriously affect their communities, while many believe the
epidemic will strike the community, but not their company.
- Sixteen percent of all firms provide information about
the epidemic, while 5 percent claim to provide anti-retrovirals
for all HIV-positive staff.
- Fewer than 6 percent have formally-approved written HIV
policies.
- Only 28 percent of executives believe their response to
the epidemic is insufficient, although 56 percent of those
who expect a serious impact on the business from the epidemic
are dissatisfied with their companies' response.
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| The report draws three general
conclusions from these results: |
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Firms are not particularly active
in combating HIV/AIDS, even when they expect the epidemic to
cause serious problems for their business.
Businesses appear to be making decisions based on a fairly patchy
assessment of the risks they face.
Firms seem to favour a broad social response to the epidemic,
even if only a small number of businesses currently see themselves
as an integral part of that response. |
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| The report recommends
the following measures be implemented in future: |
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- Accurate, objective and unbiased information on HIV/AIDS
must be generated and disseminated, covering areas such
as workforce prevalence, the impact of the epidemic on businesses
at different prevalence levels, and the cost effectiveness
of business-sponsored prevention activity.
- The potential of business associations and coalitions
to tackle HIV/AIDS should continue to be utilised, as firms
have a greater incentive to participate in and sponsor prevention
activities if they can focus on the problems facing an industry
sector or geographical area.
- Public-private partnerships should be considered where
they capitalise on the relative strengths of and incentives
enjoyed by governments, NGOs and businesses.
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| (*)Source: World Economic Forum
press release |
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| Links and key sources |
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| Global Business Coalition on HIV/AIDS |
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| Business
and HIV/AIDS: Who me? A global review of the business response
to HIV/AIDS (2003 - 2004) |
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| ICT’s HIV/AIDS Policy
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| Chevron: Corporate Responsibility Report 2005 |
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| NEWS |
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| Microsoft Teams with CAP to Train Victims of Human Trafficking in IT |
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| The Coca-Cola Company Commits to Engage in the United Nations Global Compact
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| March 6, 2006:
Yao Ming To Headline New HIV/AIDS Amareness Campaign In China
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| Businesses Committed To Fight HIV/AIDS In China |
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| COLUMNS |
INTERVIEWS |
| Corporate
Social Responsibility in HIV/AIDS: The Rising Need |
The
corporate sector has to become pragmatic and shoulder
social responsibility
Mr. Rajan Nanda, Chairman, Escorts Group |
| Corporate
Social Responsibility in HIV/AIDS: Call for greater involvement |
Public-private
partnerships need a critical mass to succeed
Mr. Jagdish Anand, Secretary General, SNS Foundation |
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Private
sector has a major stake
Mr. Onkar S. Kanwar, CEO, Apollo Tyre |
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Corporate
sector has a significant role in ensuring prevention and
control of HIV/AIDS
V. S. Jain, Chairman, SAIL |
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Public-Private
partnership vital
Mr. Rahul Bajaj, Industrialist, India |
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| Publications |
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| Using incentives to encourage AIDS programs and policies in the workplace: a study of feasibility and impact in Thailand |
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| Financial incentives and managerial willingness help to improve HIV policy in the workplace |
| Baker, S.; Sartsara, S.; Rumakom, P.; Guest, P.; et al / Horizons , 2004 |
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| This paper, produced by the Horizons Project and the Thailand Business Coalition on AIDS, explores company managers’ decision-making processes in developing workplace HIV and AIDS programmes. It also explores how incentives could be used to influence this process. The study asks: if a scheme offering reduced rate group-life insurance to a company results in improves workplace programmes; if improvements in programmes result in improved knowledge, attitudes and behaviour of company employees; how managers perceive costs and benefits of their participation; and the motivation for company participation in such schemes. |
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| Findings show that managers were more motivated to improve policies and programmes by a sense of social responsibility than by incentives for participation. Managers with closer connections to the initiative, such as physical location, or staff contacts, were more likely to participate. Other findings include: most participating companies improved their HIV and AIDS policies and programmes; broad policy improvements were not associated with specific changes at the employee level; and financial incentives were associated with greater policy improvements among participating companies. Recommendations include combining financial incentives with managers’ willingness to respond to the epidemic and paying more attention to both the participation in and programme content in HIV and AIDS workplace activities. [adapted from author] |
| http://www.popcouncil.org/pdfs/horizons/tbcafnl.pdf |
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| HIV/AIDS beyond Africa: managing the financial impacts |
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| How HIV/AIDS affetcs financial performance of companies |
| USB / F&C Asset Management , 2005 |
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| This study focuses on how HIV/AIDS affetcs financial performance of companies as well as the overall financial markets. It also explores what companies can do to manage the effects of the disease. |
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| Key Findings of the report include: |
- in 2004, estimates indicated that between 36 and 44 million people worldwide were living with HIV. With 65% of this total currently living in Sub-Saharan Africa, HIV/AIDS still tends to be regarded as an “African problem”
- the most recent 2004 UNAIDS report on HIV/AIDS, however, flags serious epidemics in Brazil, Russia, India and China, and overall rising prevalence rates in these countries
- HIV/AIDS primarily strikes working-age (15-49 year olds) members of society at the peak of their economic productivity
- increased mortality and ill-health in the employee population can damage workforce productivity and increase employment costs as a result of increases in: medical care, benefits payments, insurance premiums, absenteeism, recruitment and training costs, and disruption to production
- companies operating in AIDS-affected areas can choose to take no action or they can introduce a range of intervention programmes,focusing on preventing the spread of the disease and/or treating those suffering from it
- in many cases, companies choose to compensate for government policy shortcomings, which range from moderate to acute in respect of HIV/AIDS, because the “do-nothing” approach may prove costlier
- as far as the study can ascertain, the country risk assessments conducted by companies rarely factor in specific HIV profiles and the impact on life expectancy
- while the business community is increasingly taking responsibility for tackling HIV/AIDS, its actions remain largely limited to operations in South Africa.
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| The report concludes that as the disease spreads, the economics of prevention and treatment, as exemplified in South Africa, increasingly argue in favour of business self-help over reliance on public health authorities. In that context companies should: |
- include an evaluation of both the national prevalence of HIV/AIDS and the response of the host government in country risk assessments for new and existing investments
- implement, where relevant, prevention, education, awareness, wellness and treatment programmes, to manage the disease and mitigate its impacts press the host government to implement appropriate education and treatment policies, so as to boost the effectiveness of corporate efforts.
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| http://www.fandc.com/uploadFiles/co_gsri_hivaids_report_may_05.pdf |
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| Integration of gender sensitive HIV/AIDS workplace programmes |
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| ILO, HIV/AIDS and the world of work / International Labour Organization (ILO) , 2004 |
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| About half those living with HIV are women, but women are now becoming infected at a faster rate than men. Many women experience sexual and economic subordination in their personal relationships and at work, and so cannot negotiate safe sex or refuse unsafe sex. This briefing from the International Labour Organization (ILO) claims that governments, employers, and trade unions have vital leadership roles to play in changing attitudes and practice in the world of work and the community at large. |
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| The paper stresses that each part of a comprehensive workplace programme on HIV/AIDS covering prevention, care and the protection of rights needs to be gender sensitive. The Code aims to provide practical guidance for taking action at the workplace. It is complemented by an education and training manual that includes case studies, learning activities, and examples of nondiscriminatory laws and policies. One module specifically covers gender issues. Action taken to strengthen educational, economic and political opportunities for women, and reduce the obstacles to equality, will also serve to protect them from AIDS and its impact. [adapted from author] |
| http://www.ilo.org/public/english/protection/trav/aids/wd04en.pdf |
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