Response from Jo Allen, chair of Pharmaceutical Shareowners Group, UK: The public-health crisis in emerging markets represents a major threat to globalisation. This is primarily a challenge to governments to do much more. But in this context, investors need assurance that the companies we own are proactively addressing the crisis in order to protect long-term shareholder value. Models of pharmaceutical companies’ long-term growth, and the extent to which they incorporate global public-health issues, are therefore increasingly relevant. The health of emerging markets is important as it is linked to corporate reputation, future predictions of growth and new market development. If public criticism of the sector’s response to global health concerns continues, this could affect its licence to operate and undermine its ability to protect its innovation through the international patent regime. So improving access to medicines in poorer parts of the world is very much a business risk/opportunity issue, albeit one involving several players. This does not make pharmaceutical companies solely responsible for social development; it simply requires that they act in their own long-term self-interest. There can be a synergy between the needs of the poor and the needs of the industry – and huge benefits. Companies that build the capability to provide drugs to poor communities could, in the long term, expand revenues, earn acceptable returns on investment and build a competitive advantage. As investors, it is obviously important to us that pharmaceutical companies maintain overall profitability. But the mainstream financial community is still struggling in its attempts to find appropriate tools and models to measure the importance of emerging markets to future business. Emerging markets have for too long been seen by investors as a risk, rather than an opportunity. The difficulties relating to measurement have meant that access in emerging markets has been easy for the investment community to ignore. In response to this, the Pharmaceutical Shareowners Group Framework of Best Practice was developed to allow investors to assess these non-conventional aspects of performance. It covers areas such as public–private partnerships, political influence, R&D into emerging market diseases, market development and pricing. It therefore provides a structure which will allow management to illustrate systemised continuous-improvement approaches to responding to the issue of global health. Jo Allen is chair of the Pharmaceutical Shareowners Group and an analyst in the Responsible Shareholding Unit of the Co-operative Insurance Society, a UK mutual insurance company. She has specialised in socially responsible investment and corporate governance for over 12 years. | 
