Corporate social responsibility is a form of corporate self regulation integrated into a business model whereby organizations consider the interests of society by taking responsibility for the impact of their activities on customers, employees, shareholders, communities and the environment in all aspects of their operations. CSR, also known as corporate citizenship, sustainable business (SRB), or corporate social performance is not a very recent concept. However, due to industrialization, the impact of various businesses on society, and the growing number of well informed and educated general people, companies have now shifted focus to meeting various societal challenges while still making large profits.
In 1995, Shell, one of the world's major energy companies was boycotted for the way it dealt with the disposal of the Brent Spar, its oil storage facility. Shell faced a lot of criticism from groups like Green Peace and this incident nearly brought the company bankrupt. It was after this episode that CSR really jumped on top of the global agenda for most organizations. Since then, CSR has continuously developed into a must have policy or a complete business framework for organizations around the globe. Companies started developing plans to manage the expectations of their stakeholders, manage the way they do their business more responsibly, and also take care of the environmental impacts of their business.
During the AIDS catastrophe in Africa in 2000, the pharmaceutical industry was accused of making money out of the drugs which provided some relief to AIDS patients and not accepting their responsibility towards society. Since then, major pharmaceutical companies like Merck, Pfizer, Eli Lily, Johnson&Johnson etc. have adopted corporate social responsibility as a business strategy in an effort to communicate and demonstrate their commitment to their employees and targeted consumers in a manner that insures product safety. Product liability is a key factor in determining a company’s success in the global market. Hence, pharma companies are now voluntarily developing 'responsible business standards' with individual regulations and standards more stringent than the international standards in order to establish confidence among the firm's core constituency. This helps to generate goodwill among the stakeholders and in turn increases profits for these companies. CSR reports or sustainability reports of some top pharma companies such as Pfizer, GlaxoSmithKline, Eli Lily, Merck, Johnson&Johnson address issues such as child labor, workplace conditions, employee relations, community involvement, customer information, environmental performance and its progress against last years commitments and more.
Writing CSR reports is an art, which many top companies have not mastered yet. It can be quite tricky to represent the information in a sustainability report appropriately. According to the report ‘Branding and cure: a consumer perspective on corporate social responsibility, Drug Promotion and the Pharmaceutical Industry’, Eli Lily provided better public information about its marketing code of conduct compared to Pfizer, the world’s biggest pharmaceutical company. Does this mean that Eli Lily is a better corporate citizen than Pfizer? or has it just cracked the code for writing a good sustainability report faster? As a stake holder, would looking at a company’s CSR report be enough to judge appropriately whether it is a socially responsible company or not? Are shareholders ready to invest in businesses that focus on CSR which might give a high ROI only after long period of time rather than a short horizon?
Below are the links to the CSR reports of some of the top pharmaceutical companies:
ELI LILLY: http://www.socialfunds.com/csr/reports/Lilly_2005-2006_Corporate_Citizenship_Report.pdf
NOVO NORDISK: http://www.novonordisk.com/sustainability/reports/reports.asp
Sunday, October 3, 2010
In 2008 1.3 million Americans underwent medical procedures outside the U.S. Medical tourism, where patients travel abroad for healthcare procedures, is a growing phenomenon. With procedures costing as little as half the price while offering higher nurse patient ratios than U.S. medical facilities, U.S. board certified doctors, and hotel-like recovery suites it is easy to see why this choice is gaining popularity. The possible destinations cover the globe. For example, India is a well-known destination for heart surgery and Phuket, Thailand is highly visited by patients seeking cosmetic surgery. The breadth of surgeries available abroad is extensive, ranging from dental work to sex changes. For ten years this market grew steadily, but it experienced a slowdown in 2009-2010 along with most other markets. Most advertising for medical tourism is done online through websites such as www.medicaltourismCo.com, reflecting an interesting global marketing approach. Are there opportunities for medical tourism to continue to grow? In light of current global financial crisis and other risks, such as an outbreak of antibiotic resistant bacteria, will medical tourism be able to rebound? Do the benefits outweigh the drawbacks for seeking investment in the medical tourism market?
Advantage over US
- Discounted procedures (2005 heart value replacement: US-$200,000 vs. India-$ 10,000)
- International hospitals have gained global reputations
- Lack of health insurance is the most common factor for medical travel
- Consumer confidence has picked up
- 220 million baby Boomers in the U.S., Canada, Europe , Australia, and New Zealand
- Steady growth
- High unemployment rates
- Decreased international travel
- Political and economic instability in some of the countries offering medical procedures
- NDM-1 (New Delhi metallo-beta-lactamase 1): antibiotic resistant bacteria that is being passed through medical procedures