New study shows companies with healthy workforces outperform the JSE All Share Index

Expenses towards employee wellness can now be considered an investment as four recent studies came to similar conclusions about the impact of employee health on the financial performance of the company.

return-on-investment-employee-wellnessFour recent studies came to similar conclusions about the impact of employee health on financial performance. The latest study being published in New York this month, looked at South African companies specifically, and found companies with healthy workforces have a competitive edge in the stock market. This was tested using nine different investment scenarios, and the companies with the healthiest employees outperformed the Johannesburg Stock Exchange All Share Index, in all nine scenarios.

The new research follows three studies published in the Journal of Occupational and Environmental Medicine (JOEM) earlier, that examined the stock prices of U.S. companies with high-performing employee health and well-being programmes. All three studies found companies with high-performing employee health and well-being programmes outperformed the Standard & Poor’s index by 7% to 16% each year.

Brett Tromp, CFO at Discovery Health has commented on these findings, saying that the results further strengthen the critical economic impact and direct financial correlation between employee health and financial success of a business. Tromp explains why taking preventative measures towards employee health is critical: “Altering preventable health risk factors, such as inactivity, smoking and unhealthy diets that are associated with many non-communicable diseases, including cancer heart and lung diseases and diabetes, will become critical to prevent the projected high cost of productivity loss these conditions are expected to have on businesses over the next two decades.” Discovery’s own data is consistent with the findings of these studies, as Tromp stated that indicators from Discovery’s Corporate Wellness offering and the Healthy Company Index correlate with these studies and also indicate that employee participation in workplace wellness programmes lowers absenteeism and the direct and indirect health costs for employers.

“Taken together, these four studies add to the growing mountain of evidence that workforce health is an important factor in the financial health of a corporation,” said Daniel Malan, a lecturer at Stellenbosch University Business School, a consultant to Discovery Limited, and an author of the South African study. “Now that the connection has been made, employers can see that the decision to invest in the health of their employees is a decision associated with a healthy bottom line. Not only do employees benefit, but shareholders benefit as well.”

Derek Yach, Chief Health Officer of Vitality, adds to that: “For corporations to achieve sustained success, they must focus on the day-to-day issues that are critical to progress, such as the health of their most valuable asset – their employees.”

Walk & Work is the first company in South Africa to offer healthy workstations to bring physical activity into the office. This offers companies a solution as part of their employee wellness programme, to alter preventable health risk factors, such as inactivity. Future workplaces adjust to its people, valuing quality of life and performance. Wellness proposals are designed around specific company requirements, taking the available budget into account.



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