Aids to Hit Workforce in '03
African Press Association (Johannesburg)
March 17, 2003
Posted to the web March 17, 2003
South Africa's economy will be hard hit
in 2003 as hundreds of thousands of HIV-infected workers
develop full-blown Aids, and few companies have prepared for
Clem Sunter, a strategist for Anglo
American, South Africa's largest listed company, said most of
the country's five million HIV-positive people had contracted
the disease between 1995 and 1999 and were only now starting
to get sick.
"The worrying fact for business is
that the infection curve does not have an economic impact. The
sickness curve does," he said.
Some 20 percent of South Africa's adult
population is HIV-positive. A total of 400000 people died of
Aids in 2002 and by 2005 six million are expected to be
South Africa's government is regularly
criticised by business for not doing enough to fight the
pandemic, yet the a recent survey by a South African auditing
firm found the majority of the country's companies are largely
apathetic about the impending Aids crisis.
The International Business Owners Survey
of 250 medium-sized companies by accounting firm Grant
Thornton Kessel Feinstein (GTKF) showed that 69 percent of the
respondents did not have an Aids policy, while 85 percent had
not even commissioned a risk assessment.
Sunter said the results of the survey
seemed to confirm South African business's lackadaisical
approach to the disease.
"Unfortunately, Aids is not seen as
a strategic issue and it appears companies will not act until
the disease starts impacting on their bottom line," he
The disease is already starting to
affect the profits of some companies.
Sunter said last year Coca-Cola reported
a fall in sales in KwaZulu-Natal, the province where 33,5
percent of the population has the HI virus, the highest rate
in South Africa.
Some of the largest South African
companies, such as Anglo American, mining company Goldfields
and SAB Miller realised some years ago the cost Aids would
have and introduced policies which included providing workers
with drugs to fight the effects of the disease.
Sunter said many small and medium-sized
companies were intimidated by what they thought was the high
cost of medication.
"What many businesses do not
realise is that from an economic perspective it makes more
sense for a company to intervene and provide Aids treatment
Sunter said five years ago it cost
between R35000 and R50000 per annum to provide a person with
Today it costs between R8000 and R10000:
far less than it would cost a company to replace and retrain
"When an employee dies, the company
has to replace that person and re-skill him and this costs
Sunter said it was not too late to act.
"South Africa is only just going on
the Aids sickness curve. It takes an average of six to eight
years before a person becomes sick from the disease. There is
Leanne Bac, head of GTKF Strategic
Solutions, said it seemed that medium-sized businesses
"had their heads buried in the sand" when it came to
"Aids will decrease the size of the
local market as costs like health, medical aid and insurance
decrease income in most houses," Bac said.
Company would also have to pay more on
insurance, pension schemes, administration costs and medical
The GTKF survey showed only 10 percent
of the companies surveyed managed Aids in the boardroom. Bac
said most decisions on Aids were made by human resource
departments and fell flat.
"When a director manages Aids it is
far easier and quicker to get decisions implemented."
The SA Institute of Chartered
Accountants and the JSE Securities Exchange are preparing
guidelines that will see firms detailing the HIV/Aids-related
expenses they incur on a year-to-year basis.
"Foreign investors know there is a
problem. They would rather invest in companies doing something
about Aids than ones hiding it."/wj