Select Committee on International Development Minutes of Evidence

Memorandum submitted by Standard Chartered Bank plc


  Standard Chartered is an international banking group that is focused on the established and emerging markets of Asia, Africa, the sub-continent, the Middle East and Latin America. The Bank was founded in 1853 and has grown to become an International Group that employs 26,000 staff and has operations in over 500 offices, in more than 40 countries.

  The following Memorandum provides some details of our experience and observations on the impact of HIV/AIDS in developing countries and also provides specific information on the Bank's HIV/AIDS Programme. This initiative is currently being implemented in 12 countries across Africa—Botswana; Cameroon; Gambia; Ghana; Kenya; Nigeria; Sierra Leone; South Africa; Tanzania; Uganda; Zambia and Zimbabwe. It is planned that the Programme will also be introduced in 2000-2001 to the other developing markets within which the Bank operates after the rollout in Africa has been successfully completed.


  The Bank has recognised the need to take a proactive response towards the HIV/AIDS epidemic and has initially focused on Africa. Our initial research revealed that there was a lot of stigma attached to this disease that any of our attempts to manage AIDS would have to begin with a comprehensive education programme. We also realised that the tackling of this problem is a long-term initiative and would have to be approached in stages.

  In response to this challenge we developed a strategy which:

    —  would focus on educating staff and reassuring them of our organisation's philosophy and views towards this disease;

    —  once an awareness has been increased, monitor the incidence of the disease within the organisation;

    —  based on the data gathered in the above exercise, we aim to continually modify in the way we manage this disease.

  As of now we have focused on only the first phase of our strategy of educating staff. We began by developing an HIV/AIDS Policy and an educational Awareness Campaign.

The key aims of our Programme are to:

    —  provide information and educate all employees in Africa, on HIV/AIDS, its magnitude, impact and preventative and control measures;

    —  implement non-discriminatory Policies, Procedures and Practices in managing individuals who have HIV/AIDS through local Human Resources Departments;

    —  manage employees who have HIV/AIDS in the same manner as those with other progressive and debilitating illnesses;

    —  ensure that all of our global operations have clearly defined HIV/AIDS policies and procedures taking into account local practices, procedures, cultures and any legislation;

    —  join forces with other organisations to counter HIV/AIDS and alleviate its impact by sharing the results of our work and supporting their efforts.

The Programme has been introduced to all of our businesses in Africa through the following methods:

    —  establishment of a centrally funded London based Regional Project Office to manage, develop and roll out the Programme in each country;

    —  training of over 200 HIV/AIDS "Champions" to deliver the standard staff education Programme. The Champions are also trained in basic presentation and counselling skills;

    —  the Champions will deliver staff, family and customer-oriented presentations using the standard Education Media Pack;

    —  distribution of an HIV/AIDS staff handbook and flyers which provide information on HIV/AIDS and how to prevent and control the spread of the virus;

    —  displays of posters and flyers in the Bank's Offices and branches; and

    —  on-going monitoring of the scope and impact of HIV/AIDS in each of our businesses.


  The Bank's HIV/AIDS Programme has been developed for the following reasons:

Social Responsibility

  The Bank's businesses are based in the developing markets of, for example, Africa and Asia. In these markets HIV/AIDS is the single most important and daunting health problem facing our stakeholders including our staff and their families, customers, suppliers and Government. The current and future impact of the HIV/AIDS disease on particularly those of productive and economically active age—defined as ages 15-49 years poses an enormous social and economic challenge. Of an estimated 36 million people infected across the world as of the end of 1999, approximately 23 million, or 64 per cent, are in Africa. Standard Chartered Bank considers that it has a corporate social responsibility to support local and global HIV/AIDS preventative and control efforts and protect the basic human rights of those in the workplace who are HIV positive.

  The Bank supports HIV/AIDS initiatives of both local and international non-governmental organisations (NGOs) including the Global Business Council on HIV/AIDS, Business Exchange on AIDS & Development (BEAD) and similar country-based organisations.

  We are sharing our HIV/AIDS education materials and the Media Pack including posters, leaflets and staff handbooks with these various organisations and other companies. The NGOs also participate as attendees in our in-house HIV/AIDS prevention and educational programmes including counselling and awareness education.

Employee Health and Well Being

  Employees are critical to the success of our business. The loss of an employee is not only a personal and family tragedy, but also results in direct and indirect loss to the Bank in terms of medical costs, retraining, recruitment and productivity.

  Standard Chartered Bank is committed to the protection and maintenance of its employees' health and well being within affordable limits. To implement our education Programme, the Bank has developed and distributed an HIV/AIDS Staff Handbook, posters, flyers and other media based information to all employees and is currently presenting—to all 5,600 staff in Africa—the "Staying Alive" HIV/AIDS Presentation.

  The Bank is also collecting and disseminating information on the magnitude of the disease and developments in scientific research, especially those relating to preventive and making this information accessible to all employees. For employees travelling and for those on international postings, information is provided on the destination country including the general level of HIV/AIDS infection, any specific precautions to take, and advice on the purchase of medical travel packs.

Human and Legal Rights of HIV/AIDS Infected Staff

  Protection of the human rights and dignity of HIV-infected persons, including people with AIDS, is essential to the prevention and control of HIV/AIDS. Employees with HIV infection need to be treated in the same way as other staff and most people—subject to their health—want to continue working.

  Standard Chartered has therefore developed and implemented a non-discriminatory policy on the Human Immunodeficiency Virus (HIV) and Acquired Immune Deficiency Syndrome (AIDS). Key elements of our policy are:

    —  implementation of non-discriminatory policies, procedures and practices in managing individuals who have HIV/AIDS; and

    —  to approach individuals who have HIV/AIDS in the same manner as those with any other progressive or debilitating illness.


Projected Impact of HIV/AIDS on Standard Chartered Bank in Africa including Mortality, Sickness and Morale

  The HIV/AIDS disease is beginning to have an impact on the Bank employees and is consequently a concern to the Board of Directors. By way of background, only 44 per cent of Sub-Saharan Africans are now expected to reach their sixtieth birthday and life expectancy for a new born child is now only 49 years. In Botswana, for example, life expectancy is predicted to reduce from 60 to 44 in the next 5-7 years.

Death and Death Benefits

  As indicated above the loss of an employee is a personal and family tragedy, and also results in direct and indirect loss to the Bank. A dead or sick employee has also an impact on the Bank's productivity as well as on the productivity of colleagues.

  In general, the more technologically advanced an organisation is, the worse it may be affected by a large number of AIDS-related deaths. All of the Bank's businesses, for example, are fully computerised using First World technology. Our staff are highly trained in the use of this technology but, with there already being a shortage of skilled manpower, an organisation such as ours needs to minimise the risk of losing such staff and look after those that become unwell.

  We have had difficulties in establishing accurate statistics on the causes of death amongst our staff due to the cultural barriers and the taboo associated with the disease. However, it is estimated that currently 30 per cent of our staff in certain African businesses are infected with the virus, while 80 per cent of deaths due to sickness are due to AIDS-related illnesses.

  At a local level, feedback reports from staff during the introduction of our Africa Region HIV/AIDS Programme indicate that 70 per cent of our staff have close relatives and/or friends, who are infected with the HIV virus, have died or are dying.

  Due to the nature of our business and the dependency on skilled labour the Bank has already invested heavily in the recruitment, training and development, and health of all its employees. The Bank has therefore recognised that it must monitor closely the impact of HIV/AIDS on headcount. In addition, vigorous recruitment and retraining drives are underway particularly in the businesses in some of the countries where infection rates are estimated to be between 25 per cent and 40 per cent—including Zambia, Zimbabwe and Botswana. This is in order to ensure we are able to maintain the level of service and staffing levels required by the business/customers.

  In the year ending 31/12/99, it is estimated that approximately 92 members of staff died solely of HIV/AIDS related disease with an extra Death Benefit cost to the Bank of £750,000, almost 1 per cent of the annual Africa business cost base. Projections indicate that Death Benefit cost will rise by 30 per cent over the next three-year period.

HIV/AIDS: Impact on morale at the Staff Household level

  At the Staff household level, the impact of HIV/AIDS-related sickness and death is sudden and catastrophic. If an employee who is the main or only breadwinner develops AIDS, his (or her) family is impoverished twice over: the income vanishes as more and more is spent on drugs and relatives have to devote time and money to nursing him/her. The wife or husband has to take time off work or is forced to stop active employment in order to help. Worse, HIV tends not to strike just one member of a family. Husbands give it to wives, mothers to babies. One of our senior staff lost her husband, all her brothers, and two sisters to AIDS. She later died of AIDS. Her story is not rare.


  In Zambia, Zimbabwe and Ghana where the local legislation obliges employers of our size to offer generous medical, death and funeral benefits and paid sick leave, companies will find many of their staff, as they sicken, becoming more expensive and less productive. For example, three of our staff infected with HIV in Zambia were on extended sick leave for almost 100 per cent of last year.

  According to our Medical Scheme suppliers based in Zambia and Kenya:

    —  Nearly 30 per cent of Standard Chartered Bank Staff who visited the Medical Clinics in Zambia in 1999 are HIV-positive; and

    —  One out of every five Staff visiting the Medical Clinics in Kenya is HIV infected.

Absenteeism and Leave

  Our country HR Functions report that the level of Absenteeism in some of the African countries is rising by 10-15 per cent as staff take time off to deal with the sickness or death of immediate family members, relatives and friends.

  Other effects include early retirements on medical grounds, mismatch between available human resources and business requirements. In view of this, the policy on compassionate leave is under review with a view to limiting the number of days employees may take off to attend funerals and to tend the sick.

Welfare and Personal Staff Loans Budget

  In addition, the Bank is under pressure to increase the Subsidised Staff loan and welfare budgets. This pressure emanates from an increased number of staff that are faced with financial difficulties arising from the "extended family syndrome". Under local African Culture the most well off member of the family has an obligation to take care of all his immediate family and relatives and particularly in times of sickness and death. Our data indicates that 20 per cent of Emergency Staff Loan applications are made to "support medical, hospital and school expenses" mainly arising out of HIV/AIDS related sickness or death within the family.

  In better-off developing countries, people have more savings to fall back on when they need to pay medical bills. In most of the African countries where Standard Chartered Bank operates, savings are a luxury for a majority of the population. State medical and health insurance is also non-existent.

HIV/AIDS as a Business Operational Risk

  The pressure from the Extended Family Syndrome, absenteeism, sick leave and death all pose major operational risks to the operations of a bank. Increased levels of control are needed to discourage the potential for fraud and theft by employees.


Medical Health Budget

  In a number of countries such as Ghana, Botswana, Zambia and Zimbabwe, the health benefits are potentially very generous-a consequence of the local labour legislation. However, our experience indicates the need to establish a limit on the amount of benefit as there is no doubt that the cost burden on business will increase.

  Our experience indicates that Medical Costs are increasing at high rates. If we take into account the factors such as inflation and headcount increases, the medical budget has risen by 57 per cent, 81 per cent and 71 per cent in Zambia, Botswana and Ghana respectively over the 1998-99 period.

  Where the Bank operates both health and life insurance, for example in Kenya, the Bank is incurring higher premiums. In Zimbabwe, life insurance premiums quadrupled in two years because of AIDS. Higher premiums force more people to seek treatment in public hospitals: in South Africa, HIV and AIDS could account for between 35 per cent and 84 per cent of public health expenditure by 2005, depending on the HIV/AIDS incidence in the country, according to UNAID projections.

  In addition, both the World Bank and the South African Government have indicated that the cost to treat all of those known to have AIDS today in South Africa using the latest cocktail of drugs would be greater than the annual health budget (2 million Rand).

Cost of Treating AIDS Patients

  According to Health Management Solutions (HMS), a medical firm that support SCB and several other international firms, the cost of treating a patient suffering from AIDS related disease in East Africa has increased by 38 per cent during the 1998-00 period.

  This is based on the fact that on average an AIDS sufferer, during the advanced stages of this disease, would normally visit a doctor 3-4 times per week and would be hospitalised at least four times per year for a two week to one-month period.


  In most sub-Saharan African countries there continues to be a relative "wall of silence" on the epidemic and this may be due to many not yet feeling the effect in terms of cost to society. The level of awareness is increasing but this will have to be reinforced by international political and Non-Governmental bodies and businesses providing support to those countries with the highest levels of infection.

  For businesses there are four key areas for intervention which have been recognised and put into action by the Bank:

    —  condom promotion;

    —  customer/Family education and research;

    —  education to staff in the workplace—larger businesses can indirectly send strong messages to the community in which they operate by instituting policies to discourage stigmatisation; and

    —  lobbying Governments for change—to use our knowledge to educate and motivate policy makers to take action on AIDS.

  Only a few businesses, like SCB, are currently prepared to show leadership in this area. However, businesses are exceptionally well placed to join the fight against HIV/AIDS—both on their own and in partnership with the Public Sector and NGOs. They have the resources, are not necessarily tied to an establishment agenda and are well placed to break through the silence.

Standard Chartered Bank plc

23 June 2000

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