30.oN 36469 repaP 6002 The business of building lives: HIV/AIDS and the private sector hcra Kebour Gehna, Businesses are hit hard by HIV/AIDS, but they are also in a unique position to help fight back. The Mehmet Can Atacik, private sector interacts with most HIV infected people in a country--directly in employment relations M and Michael Jarvis or more indirectly through employee families, customers, or as community members. By joining forces to fight the disease, the private sector, together with government and civil society, has an opportunity to Kebour Gehna is exercise corporate social responsibility, in a way that makes both business and moral sense. President of the Ethiopian Business Coalition Against AIDS. Mehmet Can Atacik and Michael The HIV/AIDS epidemic has spread with fero- disease is observed in increased absenteeism, Jarvis are consultants at cious speed. Virtually unknown 20 years ago, staff turnover, recruitment, training costs as well the World Bank Institute. HIV has infected more than 60 million people as in medical care, insurance coverage, retire- worldwide. Each day, approximately 14,000 new ment funds and funeral fees. Less obvious but infections occur, more than half of them among equally pertinent costs are declining employee young people aged 25 or younger.1 In 2004, near- ly 40 million people globally were estimated to be living with HIV. In 2004, the AIDS epidemic Beyond Africa: AIDS Rates as a Percentage of claimed more than 3 million lives, and close to 5 Total Population million more people were infected with the hu- man immunodeficiency virus (HIV).2 Latin America and the Caribbean The impact of AIDS on enterprises-- through their employers, managers and work- ers--especially in countries with high HIV Deaths Middle East prevalence is well documented. There is growing and North Africa New infections in 2004 evidence demonstrating that the private sector Total infected involvement in the fight against AIDS is crucial Asia for both multinational and small and medium enterprises. Companies are recognizing that in- volvement is not only good for reasons for cor- Eastern Europe porate citizenship, but also for corporate self in- and Central Asia terest, even survival.3 0 0.1 0.2 0.3 0.4 HIV/AIDS has a direct impact on compa- Source: Avert, last accessed on 20 October 2005 nies' profitability. The economic effects of the [http://www.avert.org]. In the business of building lives: HIV/AIDS and the private sector morale and productivity. AIDS causes produc- The economic impact of AIDS therefore tivity to fall, increases business costs and nega- reaches beyond the infected population, their tively impacts on the wider economic climate families,communities,and employers and affects that influence business profitability. national and regional economies. Firms depend HIV/AIDS is a human crisis but it is also on the economic dynamism of the economies in a threat to sustainable social and economic de- which they operate, and as increasing numbers velopment. The loss of life and the debilitating of skilled employees in their most productive effects of the illness reduce the capacity of in- years fall victim to the disease, the consequences dividuals to sustain employment which, in turn, are severe. If companies fail, it leaves employees undermines efforts to reduce poverty and pro- and communities in greater poverty. HIV/AIDS mote development.4 The disease not only affects becomes as much a business and economic is- the health of workers, but takes its toll on their sue as it is a health and humanitarian concern. savings, the resources of their families and their Workforces and consumers alike are being de- overall productivity as they start spending more stroyed by the virus, while future generations are time taking care of the sick. stunted by its effects.6 HIV/AIDS hits those aged 15 to 24 the hard- Businesses are clearly hit hard by the HIV/ est5--they have the greatest number of new in- AIDS epidemic, but they are also in a unique fections. These young adults are the current and position to help fight back. Companies have future workforce and HIV/AIDS has therefore reach to every community in a country, and to become a critical issue for every company in the most HIV infected people, either through direct world today. Businesses find it hard to cope with employer-employee relations, or through more the human toll among their workforce. So many indirect relations such as employee families, cus- have died from HIV/AIDS in parts of Africa that tomers, or as community members. even allowing employees time off to attend fu- As companies, investors and other stake- nerals of colleagues and family members has se- holders recognize the impact of HIV/AIDS on verely hit production. businesses and the communities in which they Impact of HIV/AIDS on Enterprises Increased Increased Loss of absenteeism staff turnover Loss of skills tacit knowledge Declining morale Insurance cover Retirement funds Increasing demands HIV/AIDS in Health and safety for training and the country recruitment Medical assistance Declining markets, Declining intellectual Reduced foreign Funeral costs labor pool, suppliers capital direct investment Declining Declining re-investment reliability Increased costs Declining Declining profits productivity Source: UNAIDS (adapted by ILO). Working in Partnership: Ethiopian Business Coalition Against AIDS In 1986 there were just two reported AIDS cases in Ethiopia. By mid-2003 there were 147 000. It is currently estimated that of the 73 million population, 1.5 million Ethiopians are living with HIV and AIDS. Kebour Ghenna, President of Initiative Africa, argues that, "As a vital part of society, businesses should respond to the HIV/AIDS epidemic." But more needs to be done. According to a recent survey by the Ethiopian Business Coalition Against HIV/AIDS (EBC), 90% of managers in Ethiopia have encountered infected employees in their workplace and 87% have lost employees to HIV/AIDS. However, the same survey also indicated that only 18% of the companies had ac- tive HIV/AIDS committees at the workplace, 12% had an active HIV/AIDS policy and only 9% had HIV/AIDS awareness programs for their employees, leaving both the businesses and the employees at heightened risk.* The World Bank Institute's (WBI) Business, Competitiveness and Development Program, working closely with its part- ners, is assisting the EBC in Ethiopia, providing relevant knowledge and best practices for EBC member companies and building the skills of EBC so that the Coalition can train its members. EBC offers its members a range of services to help resist the spread of the disease. These include assessments of the impact of HIV/AIDS on member businesses, working to develop tailored corporate HIV/AIDS policies, and hands on help to implement workplace and community outreach programs. Such programs may involve establishing a management led committee with representation from all levels of employees, HIV/AIDS education, condom distribution, voluntary counseling and testing as well as provision of medical treatment. The initiative of the EBC has demonstrated measurable results. A growing number of local Ethiopian companies are now coping far more effectively with the impact of HIV/AIDS and providing support for the staff and families in their fight against the disease. This approach is a good model of locally driven capacity development and demonstrates the effec- tive supporting role that multilateral organizations, such as WBI, can play. * Ethiopian Business Coalition Against AIDS, Business Survey, 2005. operate, they are demanding to learn how they The Trend Beyond Africa can are address the challenges posed by the epi- Some 95% of the people with HIV are living in demic. Businesses are increasingly looking for the developing world, a proportion that is ex- tools that help them assess the impact of the pected to grow according to UNAIDS estimates. disease, gather data, shape and communicate While Africa is hit the hardest, other regions are informed policy decisions. International organi- recognizing the potential impact of the disease zations, such as the World Bank Group, and na- on their economies. For example, the World tional NGOs are working with business to help Bank estimates that Russia may well sacrifice 4% meet this need. of its GDP growth by the end of this decade due How does one increase the coverage of to the disease's rapid spread. HIV/AIDS is in- workplace programs and facilitate private sector creasingly striking Russia's labor force, including involvement at the scale necessary to get ahead strategically important sectors, such as mining, of the epidemic? One option that is yielding re- oil/gas, manufacturing, and heavy industry.8 sults, is to work with business coalitions that can It will be critical to learn lessons fromAfrica's coordinate business response with the national response,which was often inadequate in the criti- strategy. cal early stages. Those countries with low preva- National business coalitions provide a plat- lence rates need to respond as quickly as possible form that allows businesses to work together, le- through prevention programs before the disease verage their resources, and facilitate information reaches the tipping point of turning into a full sharing; permitting economies of scale in the de- blown epidemic. The private sector must be an velopment of workplace HIV/AIDS products and active partner in this effort. Encouragingly, com- services. Further a unified business front allows panies in Brazil,China and Thailand have already businesses to participate more effectively in poli- demonstrated successful examples of programs cy debate and advocacy to stop the epidemic.7 delivered in partnership with local authorities. Percentage of Workforce Lost to AIDS by 2005 Conclusion and 2020 in Selected African Countries Worldwide, companies, their employees and their communities remain greatly at risk from the spread of HIV/AIDS. On the other hand, Botswana more and more businesses are realizing that they can and must play a role in beating back the dis- ease in coordination with government and civil Cameroon 2005 society. Private sector action to fight HIV/AIDS 2020 is just one way in which business is proving its Central value as a true partner in development. There is The Business and Development African Republic growing recognition that shared problems, such Discussion Papers encourage debate as HIV/AIDS, require shared solutions involving regarding the different forms of all society. International organizations, such as private sector action for development Côte d'Ivoire WBI and its partners, actively engage with busi- and the sharing of best practices. The series is one initiative of the ness through capacity building and effective Business, Competitiveness and public-private partnerships to foster private sec- Development Program of the World Ethiopia tor contributions to development. Bank Institute. Authors are committed to fostering sustainable and equitable development and effective multi- sectoral partnerships. Guinea- Bissau Notes 1. World Bank, Human Development Network, 2005 For information on the Business, 2. UNAIDS/WHO, AIDS epidemic update, December 2005 Competitiveness and Development 3. Natrass N., Neilson T, Mistry N., Opportunities for Program, please contact Djordjija B. Mozambique Business in the Fight Against HIV/AIDS, January 2004 Petkoski, Program Leader, dpetkoski@ 4. HIV/AIDS and Work: Global Estimates, Impact and worldbank.org or visit http://www. Response, ILO, 2004 csrwbi.org/. For more information on 5. UNAIDS/WHO, AIDS epidemic update, December 2005 this subject, please visit http://www. Nigeria 6. IFC Against AIDS, last accessed on October 20, 2005 worldbank.org/wbi/businessand [http://www.ifc.org/ifcagainstaids] development 7. World Bank Group, Guidelines for Building Business Coalitions against HIV/AIDS, Ashbourne E., Principal South Africa For additional copies of this paper, Editor, W2004. please contact Redley Pinkney at 8. World Bank, HIV/AIDS in ECA, 2005. rpinkney@worldbank.org or at 202- 458-0565. Tanzania Disclaimer: The views published are those of the authors and should not Togo be attributed to the World Bank or any affiliated organizations. Nor do any of the conclusions represent official policy of the World Bank Zimbabwe or of its Executive Directors and the countries they represent. 0 10 20 30 40 This paper was printed on stock Percentage containing at least 40% post- consumer waste Source: ILO (2000) POPILO population and labour force projection; UN Department of Economic and Social Affairs, Population Division (1998) World Population Prospects: The 1998 Revision.