Important note: Information in this article was accurate in 2003. The state of the art may have changed since the publication date.
International Federation of Red Cross and Red Cresent Societies - 24 September 2003
Pekka Reinikainen in Nairobi
It's a grim picture that Chief Financial Officers of companies active in Africa are studying with growing concern. On this continent, HIV/AIDS has become a bottom line issue, and Asia and Eastern Europe are following in its footsteps.
HIV eats into the earnings of corporations by reducing productivity. Absenteeism and staff turnover increase, investment in skills is wasted, collective knowledge is lost and morale declines. And there are far too many funerals.
According to UNAIDS reports, comparative studies of East African businesses have shown that absenteeism can now account for between 25 and 54 per cent of company costs, while in Kenya, illness and death have replaced old age as the leading cause for employees to leave the service of their employer.
"In the past, many businesses opted for denying the existence of HIV/AIDS in their workplaces, fearing that acknowledging it would cost them money," says Charles K. Wachira, Human resources and corporate affairs manager for Nestle Foods Kenya. "Today, any considerate manager should be creating HIV/AIDS workplace programmes as a productive line of defence against descending profits."
Nestle is one of the pathfinders of corporate Kenya when it comes to creating effective workplace programmes to tackle HIV/AIDS. The Kenya Red Cross Society has trained some of Nestle's 120 employees as peer educators.
"We have an insurance medical scheme, but HIV/AIDS-related sickness is excluded by the scheme. However, our company helps all our employees with their medical bills," Wachira says.
He says that as well as having an impact on the work environment, HIV/AIDS has a negative effect on the economy of countries with high prevalence rates. "Families living with HIV and AIDS tend to use a disproportionate part of their disposable funds to pay for medicine and health services."
"Funeral expenses are, largely due to pre-HIV traditions, becoming the largest single expense a family makes in some parts of Africa." Wachira explains. "This is a significant threat for the future of African businesses. There would not be too many customers left to buy normal consumer goods if the cost of formal and informal health care sucks people's purses dry."
In South Africa, by 2010 an astonishing 500,000 people of a total economically active population of 16.5 million could have full-blown terminal stage AIDS, if the cost of treating the workforce can not be met.
Between 1996 and 2001, life expectancy for Kenyans dropped by 12 years to an average of 46, largely as a result of the HIV/AIDS pandemic. In 1996, the World Development Report estimated that, if AIDS were removed from the equation, life expectancy in Kenya would grow to 69.2 years by 2010. When it was taken into account, the figure plummeted to 43.7 years.
In South Africa, male life expectancy is predicted to fall to 38 by the year 2010, down from 49 in 2001. For women, these figures are 52 years in 2001 and 37 in 2010.
"Figures from many parts of Africa are devastating. If nothing is done, there will be very few left to do the work and practically no one to buy the products of any existing productive activity," says Dr Asha Mohamed, Director of Health and Social Services of the Kenya Red Cross Society.
Supported financially by Nestle Kenya and the French Business Club of Kenya, the local Red Cross Society has recently created a workplace service package for business enterprises. "This workplace programme provides interested employers with clear guidelines how to create corporate HIV/AIDS policies. It also trains a team of peer educators to work the entire human resource of a company all the way from the factory floor to the boardroom," Asha Mohamed explains.
The East Africa regional delegation of the International Federation has had its own HIV/AIDS workplace programme in place since early this year, complete with anti-retroviral treatment and active peer educators. Some Red Cross and Red Crescent National Societies in the region have recently started similar schemes theirs, and more are in the planning phase.
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