Company culture of health brings value and success, study shows

Study suggests companies with a ‘culture of health’ may outperform others in the marketplace

Those with strong health, wellness, and safety programs bested S&P 500 average rate of return in investment simulations

Companies that build a culture of health by focusing on the well-being and safety of their workforce may yield greater value for their investors, according to a study published in the September issue of the Journal of Occupational and Environmental Medicine (JOEM), official publication of the American College of Occupational and Environmental Medicine (ACOEM).

Healthy and safe employees are good
for business, researchers say.

The stock market performance of companies that had received ACOEM’s Corporate Health Achievement Award (CHAA), which annually recognizes the healthiest and safest companies in North America, was conducted at HealthNEXT LLC and analyzed by lead authors Raymond Fabius, MD, and R. Dixon Thayer, and colleagues. Companies that receive the award must be engaged in demonstrable and robust efforts to reduce health and safety risks among their employees.

Tracking an initial theoretical investment of $10,000 in publicly traded CHAA-recipients from the mid 1990s to 2012, researchers found that these award-winning CHAA companies outperformed the S&P 500.

Four investment scenarios were created, using a combination of simulations and past market-performance to create investor portfolios for comparison. While the margin of return varied, CHAA recipients outperformed the market in each of the four scenarios.

In the highest-performing scenario, CHAA companies had an annualized return of 5.23% vs. −0.06% for the S&P 500. In the lowest-performing scenario, CHAA companies had an annualized return of 6.03% vs. 2.92% for the S&P 500.

“Our results strongly support the view that focusing on health and safety of a workforce is good business,” said the study authors. “Engaging in a comprehensive effort to promote wellness, reduce the health risks of a workforce, and mitigate the complications of chronic illness within these populations can produce remarkable impacts on health care costs, productivity and performance.”

The authors acknowledge that the study focuses on the performance of a small collection of companies on the stock market for a limited number of years, and that more research is needed before a strong causal relationship can be established between health and safety programs and market results.

But they conclude that the study adds new evidence-based data to a growing body of literature indicating that “healthy workforces provide a competitive financial advantage in the marketplace.”

Source: American College of Occupational and Environmental Medicine, Lab Manager

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New study says you can save $100 per employee on healthcare just be doing this

Encourage your employees to make a few healthier lifestyle choices and you'll see almost immediate cost savings says a new study. 

"The bottom line for employers is that if you start to change employee behaviors, you will start seeing health care cost savings very quickly. In fact, an employer can save an average of $100 in health care costs per employee per health risk eliminated in the year of the change, and $105 per risk reduced in the year following the reduction," said said Steven Nyce, senior economist at Towers Watson and lead author of the study.

"But if you don't keep healthy people healthy and employees start accumulating new health risks, you not only negate this savings but stand to add health care costs of $145 per employee per health risk added within just one year."

Specifically, the study authors suggest that employers can benefit from understanding the following key findings:

• The financial implications for prevention may be even greater than for risk reduction. For every health risk added, costs increased by 45 percent above the cost savings that resulted from eliminating a risk. This means that if organizations prevent individuals from adding new health risks over time, their cost savings will be greater than if they focus on eliminating a health risk after it emerges. 

• A long-term solution is better than a quick fix. In this study, a greater immediate savings was realized from reducing health risks for people with chronic conditions than for the average employee.  Cost savings were four times greater for those with chronic conditions compared to those without chronic conditions. The study authors stressed that although there always will be a highest-cost group, an ongoing focus on prevention can benefit the entire population by avoiding chronic disease altogether in some cases or slowing the progression and diminishing the severity of chronic disease. All of these potential outcomes from prevention will improve the company's total health care spend.

The study, "Association Between Changes in Health Risk Status and Changes in Future Health Care Costs: A Multi-employer Study," was published in the November 2012 issue of Journal of Occupational and Environmental Medicine (JOEM) and is available on the JOEM website.


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Poor workplace air quality has been associated with an increase in absenteeism and productivity. Contact an Electrocorp air quality expert for customized industrial air cleaning solutions for your workplace.