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Opinion Shareholders could exert greater influence over global access to Covid-19 vaccines

Prof Aisling McMahon and Dr Edana Richardson argue that shareholders in pharma have the power to demand better from companies.

THE 11 MARCH 2020 marked the 2nd year anniversary since the World Health Organization declared Covid-19 a global pandemic.

Since then, Covid-19 has led to over 506 million infections worldwide, and 6.2 million deaths, with such figures likely an underestimate. It has brought devastating social and economic consequences.

While high-income countries, like Ireland, have recently eased most health-emergency measures, high Covid-19 case numbers continue and the pandemic’s impact remains significant and ongoing.

Global access to effective vaccines, diagnostics, and medicines against Covid-19 is key to bringing, and keeping, the pandemic under control. Yet, two years into this, significant inequalities remain around access to Covid-19 vaccines globally: over 71.9% of people in high-income countries have access to Covid-19 vaccines, compared to 15.2% of people in low-income countries. This lack of vaccine access globally increases the risks of new waves of the virus, and ultimately, threatens control of Covid-19 everywhere.

Access to vaccines

Each of us can play a role in achieving global vaccine equity. Yet one often overlooked, but powerful avenue for the public to influence this landscape is to question how our money, including our personal investments and pensions, is being invested, and to use our voice as shareholders to influence the behaviour of companies where our money is invested.

More specifically, the public can seek to collectively leverage its power as shareholders/investors to influence how companies holding intellectual property rights over Covid-19 vaccines and other health technologies are using these rights and sharing vaccine know-how globally.

In this context, intellectual property rights play an important role in how health technologies are accessed. An intellectual property right allows rightsholders to stop others from using patented technologies (e.g. elements of a Covid-19 vaccine). As such, rightsholders can control who can access and use patented technologies, and on what terms, generally for up to 20 years.

Many rightsholders of health technologies are companies, therefore, how companies use their intellectual property rights is an important factor in how healthcare is delivered.

Within those companies, shareholders could play a crucial role in influencing corporate decision-making over patented health technologies, including Covid-19 vaccines, medicines and diagnostics.

Shareholders’ influence

Drivers of corporate decision-making focus on the view that companies should be run for the benefit of the shareholders. Traditionally, this has been interpreted as the need to focus almost exclusively on maximising shareholders’ profits.

However, recent examples show shareholders are using their voice to influence company actions in the Covid-19 context to push companies to consider broader societal considerations, demanding that the focus in corporate decision-making goes beyond simply profit making.

For example, in April 2020, over 40 shareholders called on pharmaceutical companies to work to combat Covid-19. The group called for short-term financial considerations to take “second place” and for there to be a focus on ending the pandemic.

In November 2021, Oxfam America introduced shareholder resolutions calling on Pfizer and Moderna to commission independent reports on the feasibility of transferring intellectual property and know-how to facilitate the production of Covid-19 vaccines by manufacturers in low-and middle-income countries.

As Robbie Silverman, Oxfam America’s Senior Manager for Private Sector Engagement stated, “as long-term investors, we urge these companies to take immediate action to save lives and end the pandemic once and for all.”

Most recently, in April 2022, it was reported that the Institutional Shareholder Services (ISS – a leading shareholder advisory body) recommended that investors vote in favour of the resolutions introduced by Oxfam America. Alongside this, a separate resolution filed by Oxfam America called on Johnson & Johnson to provide greater transparency around pricing for the company’s Covid-19 vaccines given the public funding supporting such vaccines’ development.

Mobilising change

Such moves are becoming more common and are an important avenue that could be used to help achieve change: with growing shareholder demands that companies consider broader societal interests these voices will become increasingly difficult for companies to ignore.

This could impose greater pressure on companies to actively consider the effects of their corporate decision-making on society and would align with broader moral and pragmatic arguments around the need for global access to vaccines and other Covid-19 health technologies.

As the world continues to grapple with Covid-19, shareholder engagement can, and should, be harnessed to exert pressure on corporate actors to provide greater access to vital health technologies. Indeed others, including Dr Peter Singer, Special Advisor to the Director-General of the World Health Organization have also urged, company shareholders and boards of directors to use their voices to work to solve global vaccine inequity.

As Dr Singer aptly puts it: “As board members and investors you can stop the carnage from vaccine inequity and make the world safer in the future. Will you?”

The power and voice of shareholders could be an important driver to encourage and force companies to give greater account to the effects of corporate decision-making on society, particularly in the healthcare context.

Shareholders have the potential, and arguably a duty, to engage further in this context: to start by questioning how their money is invested, to understand what corporates do with such investments, and to use their voice to seek to encourage and shape corporate actions and decision-making in a way that enables greater access to health-technologies for (and beyond) Covid-19.

Prof Aisling McMahon is a Professor of Law at the School of Law and Criminology, Maynooth University. Dr Edana Richardson is an Assistant Professor at the School of Law and Criminology, Maynooth University.

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Aisling McMahon & Edana Richardson
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