Anglo American PLC in South Africa Essay

1. The pros would be: a) The early adoption strategy of ART can help the company to prevent and combat the spread of the disease not only on its workforce but also the populations of surrounding communities. This early initiative can also help to prevent further loss in operating expenses and declining workers’ productivity in the company. b) Anglo American became a de facto leader in the private-sector fight against HIV/AIDS in Africa. It also became a trendsetter for other MNEs to follow suit such as Coke, Ford, and Colgate-Palmolive. c) Received positive reactions and approval from WHO, the Global Business Council on HIV/AIDS, and a host of other NGOs. d) Became a socially responsible company in the global market. This comprehensive program reflects that Anglo American has a good intention on protecting the rights of infected workers. e) The program might have a bright future, as 95% have responded well to the treatment and are working productively. f) The gradual change in the South African government’s view towards HIV/AIDS can further on help Anglo American to combat this national wide epidemic issue of the disease. The cons would be: a) The company had to bear outrageous amount of operating costs to combat this issue, with an estimated $4,000 per employee when the company typically offers $830 for wages and benefits per employee. b) There is a 15% level of non-adherence from the workers who are enrolled in the program and due to harsh working conditions make it hard for workers to take medications on time or to deal with side effects. c) Pressures and oppositions from various constituencies such as the South African government, political leaders, and CEO Brian Gillbertson of BHP Billiton who all thought that the program was not efficient. South Africa’s prime minister uttered the initative as a â€Å"vigilante† move designed to place unreasonable burdens on the government. Recommendations: Anglo American should cut down on major costs to support the program in order prevent further waste of money since it can cost 7.2% of the company’s wage bill. Provide only to those who need to be treated and who can adhere to the program. Anglo American should also seek support from WHO and other international humanitarian organizations, and the South African government with the objective of a great cause for the South Africans. Also try to cooperate with pharmaceutical companies who can sell antiretroviral drugs at a subsidized rate. All of these actions should help maintain the image of the company in the global market. 2. Since migrant workers in South Africa account for about four-fifth of the total workforce, it would not be a strategic decision to adopt the policy of not hiring migrant workers. This policy can also have negative impacts on the company’s image, since it is a pretty discriminatory policy and can cause unequal treatments to workers. Therefore, Anglo American should still hire migrant workers because there are a lot of workers needed to work in the mine site. Switching policies regarding whom to hire will only further increase operating costs. 3. Pharmaceutical companies play a big role in responding to the HIV/AIDS epidemic in South Africa. Since GlaxoSmithKline can sell antiretroviral drugs to Anglo American at 1/10th of the market price in industrialized world, other pharmaceutical companies should be able to do so in order to safe the lives of millions of people. The South African government should cooperate with these pharmaceutical companies since the government itself has started implementing National Strategic Plan for combating HIV/AIDS. This will allow pharmaceutical companies to enter in B2B deals with the government and companies who care for their employees’ health. For the poor enforcement of patent rights, Pharmaceutical companies should enter into an agreement with the South African government that these rights will be protected otherwise cooperation between parties will not take place. There should be strict policies and courses of actions to tackle infringement of patent rights. Pharmaceutical companies should also invest more in R&D to create drugs for HIV/AIDS that can save the lives of people. 4. South African government should not 100% implement aggressive policies that were conducted in Brazil and Thailand mainly due to differences in political, economic, legal, cultural conditions, these policies might not work in South Africa (such as taking advantage of TRIPS agreement etc). Instead, the South African government should learn from these countries how to tackle the epidemic issues, relate the situations and implement some of the steps that might be feasible to implement in South Africa. Anglo American’s cooperation with GlaxoSmithKline purchasing life saving drugs at a reasonable price should encourage other pharmaceutical companies (especially MNEs) to join the program to fight against this epidemic disease.