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Governance of hiv/aids responses: Making Accountability and Participation Count’ University of Warwick 5-6 November 2007

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Joint UNDP-University of Warwick Conference


Governance of HIV/AIDS Responses: Making Accountability and Participation Count’

University of Warwick

5-6 November 2007

The Private Sector and Governance of HIV/AIDS Response

Professor Franklyn Lisk

Centre for the Study of Globalisation and Regionalisation

University of Warwick, UK


Tel: +44 (0) 24 7657 2533

Fax: +44 (()) 24 7657 2548

I. Introduction
The involvement of the private sector in promoting the workplace as a provider of healthcare has generally been in relation to the application of Occupational Safety and Health (OSH) standards designed to provide a safe and healthy working environment. The International Labour Organisation (ILO), which was established in 1919 to protect the rights of workers, continues to play a central role in setting standards and providing guidelines as the basis for framing international OSH regulations (ILO, 2004). At the national level OSH regulations provide the legal and policy framework for protecting workers against work-related sickness, disease and injury, and these have guided the private sector in its provision of healthcare at work. The task of achieving and maintaining a safe and healthy working environment can be quite challenging, and may require sizeable resources and a multiplicity of skills and disciplines to anticipate, identify and control numerous occupational hazards and risks.
HIV/AIDS has posed an exceptional challenge for employers in the private sector. Although the epidemic is essentially a public health concern, the ILO recognizes the problem as a “workplace issue” on account of its potentially devastating impact on workers and enterprises in all sectors, as well as the risk of HIV infection associated with a number of occupations such as in the health and emergency services. In the worst-affected countries where a substantial proportion of the adult population is infected with HIV, the epidemic impacts negatively on labour supply and productivity and, consequently, affects the output and delivery of goods and services in key sectors of the economy. The private sector in countries such as South Africa, Botswana, Swaziland, Uganda and Kenya earlier realized the threat of HIV/AIDS to enterprise survival, and interventions by the private sector in those countries have been an important component of the national AIDS response and have included innovative workplace initiatives (GBC, 2001; World Economic Forum, 2004).

The establishment of the Global Business Council (later changed to ‘Coalition’) on HIV/AIDS (GBC) in 1997 created the impetus for mobilizing the private sector in all regions of the world to respond to HIV/AIDS. GBC launched a global campaign which called on employers to take action within their establishments to eliminate HIV-related discrimination; fund HIV/AIDS prevention, treatment and care programmes; and to work with the other stakeholders including government to combat the epidemic. GBC has been instrumental in mobilizing private sector organizations at national and regional levels to set up HIV/AIDS prevention and treatment programmes at the workplace and extend them to surrounding communities (GBC, 2001; GBC, 2003). At the global level, GBC has collaborated with the UN system and other multilateral agencies to establish international guidelines and mobilize resources for fighting HIV/AIDS.

This paper is about the contribution of the private sector, from a governance perspective, to effective HIV/AIDS response. It begins with an overview of how HIV/AIDS affects the interests of the private sector through impact on labour supply and productivity and on enterprise efficiency and profitability. Next, the paper analyses the costs of HIV/AIDS to business and the benefits that can be derived from workplace interventions, and argues that it is both good business and good governance for the private sector to be involved in the provision of HIV/AIDS services in the workplace and beyond. Partnership between the private and the public sector is suggested as a practical and cost-effective way for enhancing AIDS governance for effective response; the ‘co-investment model’ is presented as an illustrative example of a workable public-private partnership arrangement. The paper concludes with a review of private sector strategies, policies and programmes for responding to HIV/AIDS and, specifically, how these contribute to improved governance for effective AIDS response.

  1. HIV/AIDS as a development challenge and implications for the private sector

According to official UNAIDS statistics, about 40 million people worldwide were infected with HIV at the end of 2006 (UNAIDS and WHO, 2006). Nine out of ten persons infected with the virus live in the developing world, and the vast majority of these are in sub-Saharan Africa (SSA).1 Since AIDS first appeared twenty-five years ago, an estimated 25 million people in all regions of the world have died from the disease and related illnesses. About four-fifths of these deaths have occurred in sub-Saharan Africa (SSA), and HIV/AIDS is now one of the leading causes of death in the region. The AIDS epidemic has been identified as a major obstacle to the attainment of the United Nations Millennium Development Goals (MDGs), which were established in 2000 and aimed broadly at eradicating extreme poverty and achieving sustainable development.2

An important feature of HIV/AIDS is its concentration in the working age population. ILO has estimated that over two-thirds of those infected with HIV are workers in both formal and informal employment (ILO/AIDS, 2004). The fact that the epidemic disproportionately affects those in the prime of their productive lives and, hence, with critical economic and social roles, is itself a major drawback on overall development efforts and has wider implications for progress towards sustainable development. AIDS is a fatal disease for with there is no known cure, and the immediate development impact is on mortality, life expectancy and population growth rates. Models of the demographic and economic impacts of AIDS in the hardest hit countries have by and large produced predictions of declining and negative population and economic growth rates (McPherson, 2002; Cohen, 2002; Lisk 2002). Evidence of the impact of HIV/AIDS on human capital constitutes a strong case why HIV/AIDS must be confronted as a development challenge, rather than merely a public health concern. The concentration of AIDS-related morbidity and mortality in the working age population leads to labour losses, including skilled and experienced workers, which is a major concern of the private sector as an employer of labour. Apart from direct labour losses, the impact at the enterprise level can be decisive to the survival of companies.
HIV/AIDS curtails the productive capacity of enterprises and limits the ability of employers to retain a stable and skilled workforce, including supervisors and managers, and to support viable health insurance and pension schemes for the benefit of workers. An enterprise is affected not only through the effect on labour productivity and the human cost to the workforce, but also in terms of losses in profits and markets. Such has been the impact of AIDS on the private sector that by the mid-1990s business was no longer asking the question “Why should we respond?”, but rather “How should we respond?”, “What should we do?” and “Who can we work with?” Business by then had recognized that the threat posed by HIV/AIDS to investment in human capital should be taken seriously and addressed strategically by policy and programme responses. Evidence of the direct and indirect costs of AIDS to business convinced the private sector that on balance it is a good business case to provide comprehensive HIV/AIDS services to employees (Rosen, et al. 2003; Natrass, et al. 2005)

III. Corporate responsibility and AIDS governance
Initially, efforts by the private sector employers to combat HIV/AIDS were limited to the provision of services to their own employees and within the workplace. However, for reasons linked to both business motive and corporate social responsibility, the private sector in highly-affected countries soon realized that it was in their interest to extend workplace HIV/AIDS services to the families of their employees and even to other members of the local community where they are based and recruit their workers. However, the involvement of the private sector in extending HIV/AIDS services beyond the workplace raises the issue of how far it can go in the name of corporate social responsibility to provide healthcare to the general population, which is after all the responsibility of government.
The private sector’s involvement in extending HIV/AIDS services to families of their employees and the community should be seen in the light of its commitment to the core imperative of doing business, rather than taking on the responsibility of government as a provider of healthcare for all. When the private sector invests in healthcare infrastructure and services it is first and foremost for the benefit of their own employees; however, this can result in the creation of ‘islands of excellence’ in the midst of run-down or under-resourced public sector healthcare facilities in the community. At the same time, failure by the state to provide adequate and affordable healthcare services in the community could mean that employees who benefit from the provision of healthcare facilities in their workplace are disproportionately better off as compared with the rest of the population in the community. This raises an equity issue in the broader context of HIV/AIDS governance at the national level. Similarly at the international level, the inability of poorer countries to provide adequate healthcare for their populations underlines demands for a more equitable and just pattern of global governance to enable poor developing countries to fulfil their obligation to citizens pertaining to the right to health (ILO/AIDS, 2006; Lisk, 2006a). As it is today, some of the countries worst hit by HIV/AIDS are also among the poorest and, hence, not able to provide affordable access to AIDS treatment and care.
An increasing number of multinational enterprises and big local companies operating in developing countries now consider it good corporate citizenship to extend workplace HIV/AIDS and other health services to local communities. They have also come to realize that ignoring the healthcare deprivation and poverty in the communities around them is not only bad for their corporate image, but is also not in their corporate self-interest as this could limit the effectiveness of their interventions to combat HIV/AIDS in the workplace. Effectiveness of AIDS response in the workplace could be diluted if interventions were not sustained between the workplace and the home and extended into the community. For example, prevention programmes in the workplace could be of little use if these were not extended to the local community where workers live and from where they are recruited.
Furthermore, there are reports that some workers receiving treatment in the workplace have expressed concern about the ‘unfairness’ of them benefiting from HIV/AIDS services which are not available to their partners and relatives or other members of the community (Lisk, 2006b; Beckmann et al., 2005)). These reports also state that workers have even resorted to ‘sharing’ AIDS drugs provided to them by employers with family members and relatives with obvious detrimental effects.

From a governance perspective, extension of workplace HIV/AIDS services to the local community requires the effective participation of workers and local people in the decision-making process. It is important that representatives of workers and the community are involved right from the start in the planning and, more crucially, in the implementation and monitoring processes. This will enhance communication and understanding between the different stakeholders, as well as foster a solid partnership that is based on mutual trust and, hence, sustainable. It is also important to ensure that the objectives of private sector supported community HIV/AIDS initiatives are consistent with national and district–level HIV/AIDS strategies and policies, and account should be taken of other existing and planned HIV/AIDS initiatives in the community in order to avoid costly duplications and unnecessary overlaps.

IV. Costs and benefits of HIV/AIDS interventions in the private sector
Calculating the costs of the HIV/AIDS epidemic to business has not been easy or straightforward, given that there are so many different factors to be measured and assumptions about how to measure. There are direct and indirect costs; costs which are specific to an individual firm or industry-wide; etc. Some of the more serious costs of HIV/AIDS cannot be measured by traditional measurement techniques. The complexity of calculating the costs of HIV/AIDS affects the determination of what can be incorporated into the cost-benefit analysis measuring. For sake of simplicity, we can assume that when companies invest in the provision of HIV/AIDS prevention, treatment, and care in the workplace they incur costs and expect to derive benefits from their investment. This implies that the aim of prevention interventions in the workplace is to reduce the number of employees who will get infected, while treatment programmes are designed to extend the working life of employees already infected.
In the absence of treatment and care, workers who are HIV-positive are likely to fall ill and absent from work more frequently than usual. The chances are that in highly-affected countries anywhere from 20 to 60 per cent of a company’s workforce may be infected and affected HIV; hence, labour productivity will decline and overall production costs will increase substantially. Without treatment, almost all of the infected workers will die sooner and well before they reach retirement age. Furthermore, employers of deceased workers may have to pay out death-related benefits to surviving dependents and contribute to funeral expenses. On top of these, employers may also have to incur additional costs in relation to recruitment and training of replacement workers, which can be quite high in a labour market that is already constrained by shortages of skilled workers.
In addition to the direct costs of HIV/AIDS and related illnesses to an enterprise, there are indirect costs linked to productivity losses and higher than normal output costs. Lower productivity and production levels and higher labour costs could reduce profits as well as contribute to loss of competitiveness in domestic and international markets.3 Production disruptions due to absenteeism and pressure on the remaining workers to maintain production could undermine morale as well as contribute to deterioration in labour relations. Valuable time of supervisors and management could be spent on dealing with AIDS-related workplace problems, including arranging funerals and addressing discrimination and stigma, rather than on their normal duties, and at a loss for production and efficiency.
The integration of HIV/AIDS into occupational health and safety makes good business sense, given the identifiable impact of the epidemic on labour supply and, hence, on production costs and profits. The private sector gains from corporate involvement and investment in prevention and treatment, in the sense that work is sustained and the benefit from the availability of skills to the enterprise is maintained. This means that firms will face lower costs, resulting from less absenteeism and disruption of work, lower retraining costs, and higher productivity across the enterprise, and skills and experience specific to the firm will remain useful for longer. A good employer will understand this and will ensure that personnel policy and other support services are in place to keep HIV-infected and affected employees productive for as long as possible.
In this regard, the GBC had warned that companies that do not address the effects of the epidemic on their business would find it hard to compete in both the domestic and global markets, and drew the attention of the private sector to the positive benefits and avoidance of costs to be derived from effective HIV/AIDS policy and programme responses (GBC, 2001). At the same time, substantial reductions in the price of AIDS drugs and dynamic therapeutic response in recent years have lowered the costs of treatment and increased the margin of the returns to investment by the private sector in HIV/AIDS treatment and care.
In the early stages of the epidemic, the economic benefit to the private sector of HIV/AIDS interventions may not be so obvious, because the impact of HIV infection on the labour force will be initially masked and only become apparent as workers fall ill and subsequently die. This indicates that enterprises need to be proactive early in their response to the epidemic and establish effective programmes for HIV prevention. They should also adjust working practices through management change and ‘reasonable accommodation’ for those affected, in order to alleviate the impact on costs and production. None of these is easy to achieve, but is important if the gains from HIV/AIDS policies and programmes are to yield their full benefits both for enterprises and more generally for the economy and society.
Effective response to HIV/AIDS by the private sector generates benefits elsewhere in the economy. HIV-positive workers that receive treatment can continue to work and earn an income to support themselves and their dependents, as well as generate potential tax revenues on incomes and expenditures for government. This is in contrast to being sick, in the absence of treatment, and becoming a burden or additional costs to the state and their families. But a comprehensive approach to AIDS response in the workplace could be costly and, even with the substantial reduction in the costs of ARV drugs, this is still beyond the resource capabilities of many companies in the developing countries.

  1. Enhancing AIDS governance through Public-Private Partnerships

Because of the high cost of providing comprehensive HIV/AIDS services, partnership between the private and public sector is being used increasingly in AIDS response to scale up and expand prevention, treatment and care programmes. Public-private partnership (PPP) is seen as a practical arrangement for responding to demands on the private sector to extend HIV/AIDS services beyond the workplace to the community, as well as addressing the inability of government to provide adequate healthcare facilities and services for effective AIDS response. Business alone cannot absorb all the costs of providing HIV/AIDS services in the community, nor can business address HIV/AIDS as a cost issue. Government, as the authority responsible for putting in place the regulatory and policy framework for private sector participation in the economy, is well placed to work in partnership with the private sector in AIDS response. For example, government can provide administrative, legislative and fiscal incentives to facilitate a strong private sector response to the epidemic. Business in turn can work with government to address the social and health costs of HIV/AIDS, through its own extended workplace programmes.

Partnership between the public and private sector in AIDS response was recognized and endorsed at the June 2001 United Nations General Assembly Special Session on HIV/AIDS (UNGASS), when international business leaders, under the umbrella of the GBC, joined world leaders at the United Nations to respond to the global AIDS crisis (United Nations, 2001). It was noted at the time that the capacity of business to respond to the crisis could be enhanced by operating in partnership with the public sector to implement comprehensive HIV/AIDS programmes.
A particularly interesting application of PPP to AIDS response is the ‘co-investment’ model which has been used by the Global Fund to Fight AIDS, Tuberculosis and Malaria (hereafter referred to as the Global Fund) and the UN system and endorsed by the GBC and major bilateral donors as a mechanism to co-finance and support mutually-beneficial joint HIV/AIDS service provision. The establishment of the Global Fund in 2002 created a unique opportunity for the joint participation of public and private sector stakeholders in central issues of financing and implementation of large-scale HIV/AIDS projects at global and national levels. Soon after its establishment, the Global Fund signed a memorandum of understanding with the GBC to work together in promoting partnerships between the public and private sectors in AIDS response at all levels.

The co-investment model

The origin of the concept of ‘co-investment’ was a joint working paper by the ILO and the Global Fund, which was prepared for a meeting in Evian, France, that was on organised by private sector employers in the eve of the G8 Summit in July 2003 (ILO and GFATM, 2003). The document sought to clarify some of the basic principles and practical elements for making use of public-private partnerships to support the implementation of Global Fund grant projects at country level. The ILO/Global Fund paper was intended to influence thinking about the role and contribution of the private sector to the global effort to combat HIV/AIDS, and the concept of ‘co-investment’ was presented as strategy for positioning the private sector to become a major partner of the then newly-established Global Fund (Lavollay, 2003).

Following the Evian meeting, the ILO collaborated with the Global Fund and the German bilateral technical cooperation agency, GTZ, on how to transform the co-investment model into an operational mechanism for mobilizing resources to facilitate the extension of HIV/AIDS services in local communities. With reference to the role of the private sector, the application of the co-investment model is consistent with the principle of corporate social responsibility and contributes to meeting the goal of universal access to HIV/AIDS prevention, treatment and care.
Further elaboration of the concept and its application to technical cooperation activities by the ILO, GTZ and Global Fund yielded encouraging results, which attracted the interest of the GBC and major international and bilateral development agencies such as the World Bank, the World Economic Forum, DFID, SIDA, the Dutch Development Cooperation Programme and USAID (GTZ and GBC, 2005; Beckmann, 2006). Co-investment was endorsed and recommended by the GBC to its global membership (GBC, 2004), leading to the adoption of the model to AIDS response by well-known companies such as Unilever Tea in Kenya and Tanzania, Lafarge Cement in Nigeria, Daimler Chrysler in South Africa, Anglo American Group in South Africa, Ghana and Zimbabwe, Standard Chartered Bank in the Gambia and General Motors in Kenya.

This model is now used increasingly by the Global Fund to encourage partnerships between the private sector and public sector authorities, and to promote the involvement of the private sector in providing direct support for Global Fund-financed HIV/AIDS projects at the country level.4 The institutional arrangement created by the Global Fund at the country level for submitting grant proposals was seen as an ideal mechanism for the participation of private sector stakeholders in central issues of planning, co-financing and implementation of projects.

The Global Fund requires countries to set up a multi-stakeholder ‘Country Coordinating Mechanism’ (CCM) as a single national coordination body responsible for preparing and submitting grant proposals to the Fund, as well as overseeing and monitoring progress during the implementation of the proposal. The CCM is considered an essential structure of the Global Fund’s architecture that was designed to reflect the Fund’s commitment to ‘local ownership’ and ‘broad-based participation’ - involving both state and non-state actors as well as other beneficiaries. The private sector is thus represented in the CCM at country level, providing an opportunity for its entry into partnership with other stakeholders to develop proposals, co-finance and implement large-scale HIV/AIDS projects in and outside the workplace.
The co-investment model was recognised by the Global Fund as one of the options for involving the private sector in the preparation and implementation of country proposals submitted to the Fund. The model was seen as particularly relevant to the operation of the ‘Country Coordinating Mechanism’1 (CCM) that is used to ensure the participation of a wide range of stakeholders in the preparation of proposals to be submitted to Global Fund. It was argued that by being a part of the CCM, the private sector could influence grant proposals to include private sector participation and contribution on the basis of partnership with the public sector and other stakeholders. For example, it should be possible for the private sector to contribute additional resources for the implementation of HIV/AIDS projects which are financed primarily by the Global Fund and managed locally by public sector authorities..
The willingness of business to contribute directly to public sector AIDS response and to use of the CCM as the basis for its participating, was welcomed by the Global Fund as an ideal arrangement for involving the private sector in the Fund’s processes. Hence, it was with tremendous excitement that the Global Fund announced in October 2003 that the Anglo American group in South Africa [a GBC member] had embarked on a ground-breaking co-investment scheme with the Fund and other partners, including the Nelson Mandela Foundation and the Henry J. Kaiser Foundation, to support a major youth-oriented HIV/AIDS initiative, ’Love Life. Anglo American’s contribution to this initiative was the first example of how a private company can use the opportunities created by Global Fund financing to benefit the community at large through co-investment schemes. By 2004, a number of GBC-affiliated companies and national business coalitions had partnered with other stakeholders to prepare proposals on co-investment schemes for submission to the Global Fund. This was the case in Botswana, Ghana and India where proposals sent to the Global Fund under Round 3 applications incorporated components from private employers, and also for Namibia and Zimbabwe whose Round 5 grant applications included co-investment schemes.
The Global Fund also ensured that opportunities for corporate co-investment schemes were not limited only to interventions at the proposal development phase, but included the participation of the private sector in subsequent phases of the Fund’s operational cycle (i.e. the grant negotiation, grant implementation and grant governance phases). There were examples from Malawi, Tanzania, Uganda and the Gambia of involvement by the private sector in co-investment schemes at the grant implementation and governance phases.

Well-known international companies, such as Anglo-American, Anglo Gold, BMW, Daimler Chrysler, General Motors, Lafarge, Heineken, Unilever, Chevron Texaco, Shell, Pfizer and Standard Chartered Bank have all made use of corporate co-investment schemes to partner with public sector businesses and NGOs in contributing to overall HIV/AIDS efforts at national and local level. Within the framework of the CCM, the private sector has been involved in the preparation and execution of project proposals covering a variety of HIV/AIDS services ranging from the establishment of Voluntary Counseling and Testing (VCT) services, upgrading and expansion of community health facilities and home-based care to training and capacity-building of health sector, procurement of drugs and leveraging of additional financial resources. The willingness of business to contribute to public programmes in this manner, combined with the support provided by government for co-investment schemes, attests that this type of collaboration is cost-effective from both a development and a business perspective.

The Global Fund particularly values the opportunity provided by co-investment for the private sector to put its health infrastructure, including hospitals and clinics and drug procurement service, as well as its management experience into wider use as a public good for the benefit of everyone. The former Executive Director of the Global Fund summed up the advantage of this type of partnership as follows: “ Co-investment allows the private sector to contribute real assets and expertise to what must be a unique joint public/private collaboration in local communities [and] the Global Fund looks forward to providing financial support for this approach.” The importance of contribution of real assets by private sector companies to co-investment projects is clear from the fact that infrastructure costs have accounted for almost 40 per cent of the financial resources needed on average to scale up national AIDS programmes in highly-affected countries such as Botswana, Kenya and Zambia.

VI. Private Sector AIDS response and governance
Responding to HIV/AIDS for reasons of good corporate citizenship is good governance, as it can be argued that the private sector is going beyond its corporate self-interest and taking on the responsibility to address the threat posed by the epidemic to the wider development process. Implicit in this responsibility is commitment to satisfy the health and other basic needs of the people and to meet such broad development objectives as poverty reduction. As a governance concern, the link between AIDS and poverty in many developing countries has to be recognized and taken into account in the context of the formulation and implementation of HIV/AIDS response strategies, policies and programmes. AIDS is a manifestation of existing poverty conditions which, in part, are the outcome of low disposable incomes and unsustainable livelihoods and, in part, the result of the impact of the epidemic on socio-economic conditions. Consequently, the maintenance and expansion of poverty through the spread of AIDS harms the economy and holds back development the business. Conversely, reduction in poverty through improved governance of the development process helps to control the spread of HIV/AIDS.
Given the bi-directional links between AIDS and poverty, it is now commonplace to argue for the integration of policy and programme responses to AIDS with poverty reduction programmes. Policy and programme responses to HIV/AIDS by the private sector can reduce the economic and social costs of the epidemic to business and at the same time contribute to national efforts to reduce poverty.
Just how private sector interventions can contribute to improved governance in terms of poverty reduction and improvement in human well-being, requires an understanding of the relationship between income and health. As an employer of labour, the private sector has a vested interest in important human resource indicators such as labour productivity and education and skill level. A healthy and educated workforce is an important factor in sustaining enterprises and keeping them profitable. The most important contribution of the private sector’s HIV/AIDS interventions to poverty reduction is perhaps through the impact of such interventions on human capital. The deprivation of human capital is itself a form of poverty, which is linked to the governance of the AIDS epidemic in terms of the loss of capacity to develop and utilize human capabilities to respond to the epidemic. Interventions in the private sector which reduce the risk to HIV infection and prolong working life are critical to reducing poverty at all levels.
Improvements in the health status of a community resulting, for example, from direct contribution by the private sector to community healthcare could yield higher incomes and promote economic growth, which in turn can help to reduce poverty. The ‘additionality’ of the contribution of the private sector should reduce the economic and social costs to the government for responding to HIV/AIDS, and leave the public sector with greater fiscal space to address poverty. Furthermore, it is likely that improvement in the health status of the general population will be more beneficial to the poor disproportionately, as they depend more on their physical labour as a productive asset for earning an income than other socio-economic groups. Empowerment of the poorer segments of a population in this manner is an important contribution to good governance in terms of responding basic human needs linked to the rights to health, employment and other socio-economic opportunities.

VII. Conclusion
The private sector, ranging from multinational companies to medium and small enterprises at national level, has become increasingly involved in the fight against HIV/AIDS, not only for reasons of corporate self-interest but also out of sense of corporate responsibility. Concern by enterprises about the impact of the epidemic on productivity and profitability as well as about their corporate image, underpin a strategy in which the private sector takes responsibility for the governance and delivery of HIV/AIDS services. The private sector in many instances has qualities and facilities, problem-solving expertise, as well as the entrepreneurial spirit, which can be decisive in AIDS response. Partnerships with the public sector and other stakeholders at national and global levels have been useful in extending the reach of private sector HIV/AIDS interventions beyond the workplace, indicating the potential for business to contribute to effective HIV/AIDS response and mitigate the wider development impacts of the epidemic across communities.
The Political Declaration on HIV/AIDS adopted by the UN General Assembly in June 2006 recognizes the important role of the private sector at the country level towards meeting national targets on HIV prevention and the treatment of AIDS. Direct business action will ensure benefits that maintain efficiency and productivity of enterprise operations, as well as protect their greatest resource – human capital. Experience and lessons learned so far suggest that the private sector in many highly-affected countries, on account of its resources and experience, will continue to influence national capacity to respond effectively to HIV/AIDS as a development challenge especially in an era of rapid globalization. In an increasingly interconnected world, the transmission of HIV and the effectiveness with which it is responded at all levels will have significant impact on economic and political governance and, hence, the ability of governments and national economies to protect and satisfy the basic needs of the people.
The vibrancy of the private sector’s entrepreneurship and innovation can help to surmount existing barriers in the fight against HIV/AIDS and improve the reach of current efforts. The participation of the private sector as a major stakeholder in AIDS response should therefore be encouraged and enhanced, both as means of contributing to good governance and for meeting the e challenges of effective response.

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1 The Country Coordinating Mechanism (CCM) was set up as an essential structure of the Global Fund’s architecture and underlined its commitment to local ownership and broad-based participation of all major stakeholders, including non-state actors, in the decision-making process. The typical CCM includes as such representatives from both the public and private sectors, as well as multilateral and bilateral development agencies, NGOs and civil society organisations, as well as associations of PLWHA, and is charged with the responsibility to develop and submit grant proposals to the Global Fund, based on priority needs at the national level. After grant approval, the CCM is also responsible for overseeing and monitoring progress during implementation of the proposal.

1See ILO,

 UNAIDS and WHO 2005

2 One of the MDGs is aimed at controlling and reversing the spread of HIV by 2015, and there is consensus among the international community that the other MDGs cannot be achieved without an effective response to HIV/AIDS. See Sachs 2005.

3 GBC 2001; Hacker 2001; McPherson 2002

4 Cohen 2006; ILO/AIDS 2006

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