The pressure to hit financial numbers can cause many companies’ leaders to focus solely on the balance sheet and ignore what turns out to be a quantifiable and manageable lever that is proven to affect the bottom line: well-being. to be workers.[i] Many assume that welfare is a ‘soft’ issue and not a management problem to be solved; however, this is an error. The potential health benefits of workplace wellness programs have been demonstrated in large cohorts over the past four decades and also include engagement, retention, and productivity.[ii] Studies show that an overall wellness strategy and culture has a positive impact on business performance.
Culture of well-being: leadership management and employee inclusion
Engagement has been a top priority for companies for years, but according to Gallup, the most progressive employers are beginning to view satisfaction and engagement as smaller elements of what really matters to their workforce, i.e. -to say well-being.
Company culture is implicit, not expressly defined, and develops organically over time from the cumulative traits of the people the company hires. Corporate culture also refers to the beliefs and behaviors that determine how a company’s employees and management interact and handle outside business transactions.[iii] Recently, employers have marketed a “wellness culture” to attract and retain top talent, bring out the best in their employees, and manage healthcare costs.
Unfortunately, a wellness culture has mostly been a “slogan” or simply a generic, delegated health program to the HR department to tactically manage health costs. Real wellness is not a ‘program’, it’s not a ‘subject’, but rather a mindset, a philosophy or, more often than not, a cultural orientation in the workplace. According to a 2019 Gallup study, if employees had higher wellbeing in the first year, they would tend to have higher work engagement in the second year as well as increased positive change in wellbeing. during the second year.
Conversely, if employees are struggling or suffering, this attitude negatively affects the overall work environment and the team. Managers strongly influence organizational culture, and if managers discuss and promote wellness as the norm, their employees become more involved in wellness activities. If managers are not engaged, then this cascade to employees does not exist.
Wellness cannot just be words on the wall, a standalone online program, or part of the culture description on the website. On the contrary, leadership and management must “step up” and make wellbeing part of the norm; the way of doing things here; and include employees in development. Organizations need to focus on creating a humanistic culture where people feel like they have meaningful work and purpose, opportunities to engage with their manager, productive and healthy environments, and opportunities growth and confidence in leadership.
Wellness is a philosophy and a commitment to create a healthier, happier and more productive workforce, community and world. It is up to leaders within organizations to focus on empowering and creating the conditions for employees to thrive and be well personally, professionally, physically and financially. Unfortunately, we still have the debate that wellness really makes a difference. The answer is yes.
Increase in inventory performance attributed to workplace well-being
In their seminal paper, Fabuius, R., Thayer, RD, Konicki, D. (2013) linked workforce health and safety to health outcomes by tracking company performance on the market. The hypothesis that overall efforts to reduce the health and safety risks of a workforce can be associated with a company’s stock market performance has been confirmed. The stock market performance of the Corporate Health Achievement Award (CHAA) winners was tracked under four different scenarios using a simulation and past market performance. The portfolio of companies recognized as award-winning for their approach to the health and safety of their workforce outperformed the market. This evidence confirms that creating a health and safety culture provides a competitive advantage in the marketplace.
Another study assessed the stock performance of publicly traded companies that scored high on the HERO Employee Health Management Best Practices Scorecard in collaboration with Mercer© based on their implementation of evidence-based workplace health promotion practices.[iv] Their findings reinforced the financial benefit of workplace wellbeing, as the stock values of a portfolio of companies that received high scores in a self-assessment of corporate health and wellbeing increased by 235% compared to the appreciation of the S&P 500 index of 159% over a period of 6 years. simulation period. This study concluded that a solid investment in the health and well-being of the workforce appears to be one of the many practices followed by successful and well-run companies.
A study of Koop Health Award-winning companies explored the connection between companies investing in the health and well-being programs of their employees and measured stock market performance. The hypothesis tested was that companies that applied for and won the Koop Prize, thereby earning the distinction of having outstanding health (wellness) promotion programs at work, would realize financial gains that would extend beyond from those who simply offer traditional employee health programs. They used the stock market performance of the Koop Prize winners (not = 26) measured over time and compared to the average performance of the companies making up the Standard and Poor’s (S&P) 500 index. The Koop Award portfolio has outperformed the S&P 500 index. Over the 14 years monitored (2000-2014) , the value of Koop Prize winners’ shares appreciated by 325% compared to the average market appreciation of 105%.
This study supports ongoing research demonstrating higher market valuation – an affirmation of the commercial success of Wall Street investors of companies that invest in the health and well-being of their workers compared to other publicly traded companies. The dividend yield and P/E price/earnings ratio of Koop Awarded companies were compared to the S&P 500 index. The analysis revealed that Koop winners produced higher dividends than the S&P 500 (2.31 % vs. 1.95%) and that their P/E ratio was lower (17.31 vs. 18.27), meaning that their performance was not based on an overvaluation of the company.
An even more recent study was conducted to assess “Does higher employee well-being lead to higher productivity and ultimately tangible benefits to companies’ bottom line through meta-analysis of 339 independent research studies. This included the well-being of 1,882,131 employees and the performance of 82,248 business units, drawn from 230 independent organizations from 49 industries in the Gallup Customer Database. The results produced a significant and strong positive correlation between employee satisfaction with their company and employee productivity and customer loyalty, and a strong negative correlation with employee turnover. Ultimately, better workplace well-being is positively correlated with better profitability at the business unit level.
Solid investment in the health and well-being of the workforce seems to be one of the practices pursued by successful and well-run companies. The positive financial results of a company confirm the need to continue to cultivate a culture of well-being and a strategy integrated into the ethics of the organization.
What are you waiting for? Why is this still being debated?
[i] Tom Rath and Jim Hartner, Well-being. The five essential elements. Gallup Press, New York (2010).
[ii] Leonard L Berry and Ann M Mirabito and William B Baun, How hard are employee wellness programs performing? Harvard Business Review (2010), 88, 204.
[iii] Patrick Kulesa and Stephen Young, Work experience in high performing organizations. Toronto: Watson Towers (2019).
[iv] Grossmeier et al. Make the connection between best practices in workplace health and promotion and the financial performance of the organization. Journal of Occupational and Environmental Medicine (2016), 58(1), 16-23.