South-Western - Management  
Business Responsibility for HIV/AIDS
Topic Ethics and Social Responsibility
Key Words HIV/AIDS, social responsibility, corporate citizenship
InfoTrac Reference A114740375
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News Story 

On World Aids Day the World Economic Forum (WEF) reported that business was not yet playing a significant positive role in the fight against HIV/AIDS. It surveyed 8,000 corporate executives, and found that 47% believed that HIV will have some impact on their business. Fewer than 6% of responding companies had formally approved, written HIV policies, although over a third believe their current policies and programs are sufficient and effective.

The United Nations Research Institute for Social Development (UNRISD) recently published findings that documented a wide variation in specific HIV/AIDS prevention and mitigation components of corporate policies and programs, and the extent of coverage provided to employees and their dependents. In addition, most companies do not consider how their normal operations and strategies affect poverty, and thus HIV/AIDS. This is despite the U.S. Declaration of Commitment on HIV/AIDS, which emphasized the importance of poverty and sustainable development on the spread and impact of HIV/AIDS.

The report argued that not only is the corporate sector just beginning to wake up to the risks posed to business operations by HIV/AIDS but that it has still to awaken to its wider responsibilities, which arise from its influence over those conditions that encourage HIV/AIDS prevalence and undermine possibilities for mitigating its effects. That influence derives from some corporations' reliance on migrant labor, subcontracting, exerting downward pressure on production prices and wages, tax management and evasion, as well as negative influence over the international financial and trade institutions.

HIV/AIDS may pose significant risks to current and future corporate performance. The financial community should increasingly be interested in whether the companies they invest in are attuned to that risk and manage it accordingly. Some companies are beginning to address the risks to their business by announcing that they will use their facilities, employees and other infrastructure to expand workplace HIV/AIDS prevention and treatment programs into communities where they operate.

There are concerns about corporate citizenship and international development. For instance, the charity ActionAid has accused pharmaceutical companies of using charitable donations of drugs as part of a strategy to undermine calls for curtailing patents and promoting domestic production capacities in developing countries.

Questions
1.

Being socially responsible can be expensive for a company. Issues like corporations' reliance on migrant labor, subcontracting, and exerting downward pressure on production prices and wages may improve the bottom line while encouraging poverty, and hence the conditions that encourage the spread of AIDS. When a company must choose between being socially responsible or its own economic performance, which should it choose? What factors must be taken into consideration?

Source "Business Responsibility for HIV/AIDS," The Journal of Corporate Citizenship, Spring, 2004, p. 6.
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