Corporate Governance and Social Responsibility: South African National Coalition on HIV/AIDS: briefing

Meeting report

CORPORATE GOVERNANCE AD HOC COMMITTEE
20 January 2006
SOUTH AFRICAN NATIONAL COALITION ON HIV/AIDS: BRIEFING

Chairperson: Ms B Hogan (ANC)

Documents handed out:
SABCOHA presentation
Corporate Governance presentation
(please email [email protected] for documents)

SUMMARY
The South African Business Coalition on HIV / Aids briefed Members on the objectives of the organisation, key priorities and present achievements in the fight against Aids within the private sector. Perceptive surveys were conducted on a regular basis in partnership with the Bureau for Economic Research across all sectors within the private sector. Communication and dissemination of relevant information was a core priority of the group. Companies had to be empowered to take action against Aids. Policy advocacy and lobbying were also areas of focus. Certain economic sectors had achieved higher levels of transparency than others and the Coalition would attempt to raise the overall level of reporting and treatment programmes throughout the economy. Partnerships with tertiary research institutions would be encouraged to generate meaningful statistics and devise appropriate policy responses. The healthy South African economy could mask the direct effect of the disease. Companies had to make anti-retrovirals available to employees. Reporting practices within the private sector had to be improved. Company policy had to be implemented down to the operating level to render them effective. Social research should focus on new areas of manifestation of the disease.

MINUTES
South African Business Coalition on HIV / Aids (SABCOHA) presentation
Mr B Mears (Director: SABCOHA) stated that SABCOHA partnered with the Bureau for Economic Research (BER) based at Stellenbosch to produce perceptive surveys on the extent of Aids within the private sector. The organisation intended to promote the use of best practice throughout all economic sectors. SABCOHA also focused on the dissemination of relevant information garnered from surveys and forums. Partnerships were vital to ensure meaningful responses to the threat of Aids. The overall objective of the organisation was to empower businesses to take effective action against Aids. Currently, 36 corporates of varying size were members of SABCOHA and a new Board of Governors had been established. A two-way relationship was encouraged between corporate members and the organisation. Various steering committees had been set up to drive activity focused on research, communication, policy and lobbying.

Research remained a core area of the group and national surveys were conducted on a regular basis. More research within the private sector was necessary to generate meaningful responses to the epidemic. Certain economic sectors such as financial services had conducted internal surveys identifying the level of prevalence but more was required in other sectors. SABCOHA would partner with tertiary research institutions to create broader research agendas. An optimal combination to tackle the disease would consist of the government at the local level, tertiary research groups and key private companies. Companies had responded to the challenge in variable ways. However, the private sector should play a stronger leadership role in devising adequate responses and implementing them. Research surveys had to be conducted throughout companies and not remain at the Board and executive level.

Discussion
Mr Laubuschagne (DA) noted the importance of inverting the process to include the grassroots level in formulating meaningful surveys but asked whether the process should not be driven from the top in companies.

Mr Mears responded that policy was determined at the executive level but had to be implemented downwards to prove effective. Policy remaining at the top level was ineffectual. Certain mines had extensive knowledge of Aids prevalence whereas many other businesses had scant knowledge of the extent of the disease. Strong executive leadership was fundamental in driving the process down to the operating level. Aids had a major impact on labour-intensive industries. Migration also played a key role in exacerbating the spread of the illness. Private sector companies had to provide comprehensive cover to all employees in future. Aids would have significant impact on the financial services sector customer base and more research was needed on the likely economic consequences. Industries with a high transient nature such as construction posed most risk to employees. The current bullish South African economy could mask the overall impact of Aids. The projected impact on future profits and the perception of companies towards the Aids threat were explained. Company policy had to be implemented in consultation with all stakeholders. The finance, mining and transport sectors had the most proactive responses to policy development.

Ms Hogan asked which companies were on the current database.

Mr Mears stated that the BER annual survey involved 1300 respondents sourced within various sectors. Effective company policy had to result in a meaningful impact on workers' lives. SABCOHA would focus on the problem of stigma and discrimination as a main priority. Various programmes implemented by companies were explained. Access to voluntary counseling and treatment had to be increased. Companies should make anti-retrovirals available to employees. A more integrated relationship between government and business was needed to address the stigma of Aids. More research on prevalence was required amongst small and medium enterprises. SABCOHA would encourage greater co-operation with the Department of Trade and Industry. Tax incentives for companies should be considered to promote the provision of anti-retrovirals.

Current SABCOHA activities, such as the creation of a toolkit, were explained. An overarching strategy to combat Aids would be developed within the motor industry. Co-operation between smaller companies could make the cost-factor for treatment more affordable. The provision of relevant information to companies by SABCOHA would strengthen responses. SABCOHA's partnerships with other organisations were explained including national and provincial government. The organisation would work with key international groupings such as the International Labour Organisation and the World Economic Forum. The role of Sector Education Training Authorities (SETA’s) in combating Aids had to be improved and more financial resources should be allocated to assist companies in training activities. Recently, SETA budgets had been altered away from Aids-related activities to more general learnerships.

More policy had to be produced from a workable relationship between government, the private sector and health institutions to address corporate governance concerns. Capacity within the Department of Health had to be increased. Policy had to be formulated from sound research and appropriate governing principles. Company reporting on Aids had to become more transparent and substantive.

Ms Hogan asked which organisations were monitoring the reporting on Aids by companies.

Mr Mears responded that SABCOHA did not monitor the veracity of reports from companies. The Africa Institute of Corporate Citizenship could assist in this regard. A guide for investors was being created to promote shareholder activism. Many international located shareholders displayed less interest in Aids issues when considering investment in South Africa.

Ms Hogan noted that a shift in consciousness had to be facilitated to encourage monitoring of companies responses to the threat of Aids. The successes of certain South African companies in providing adequate responses to the challenges had to be better communicated to convey a positive message to potential investors.

Mr Mears concurred and declared that a key objective of SABCOHA was to improve perceptions around Aids within South Africa and clearly show what steps were being taken to mitigate the negative consequences. South Africa could play a leading role within the developing world in devising meaningful responses to Aids. Companies should improve reporting procedures in general and collect more substantive data on the extent of the epidemic. Reporting within Annual Reports should be focused upon to address shortcomings. Companies should clearly show the prevalence rate and refrain from hiding facts.

Ms Hogan noted that reporting was of a higher standard within larger companies but remained problematic within medium and smaller companies.

Mr Hendricks (UIF) asked whether Aids was likely to be declared a notifiable disease and whether this would improve the understanding of the extent of the disease.

Mr Mears stated that SABCOHA would support the notifiability of the disease and the concomitant establishment of a central database. Stereotypes and stigmas had to be addressed urgently. The South African business culture of secrecy and discrimination had to be dramatically reduced to assist in the fight against Aids. The legal protection accorded to companies by the practice of confidentiality contributed to the lack of transparency. Research should be broader and focus on new social manifestations of the disease. Notifiability should occur in a qualified manner.

The meeting was adjourned.