Can a company say to its employees, "We have to weigh you because our shareholders want to know how overweight you are," or "Let me take your blood pressure; our institutional investors need to know."
A working group whose members include Humana, IBM, Johnson & Johnson, Merck, PepsiCo, Unilever, and South African insurer Discovery Ltd. Companies recently proposed that publicly traded corporations provide an overview on the health of their workforces in their various forms of public disclosure, including annual reports, 10-Ks, and sustainability reports.
According to one article, in an age when public companies are expected to be transparent, health data should be represented in that information. Vitality, part of the South Africa-based integrated financial services company Discovery, has stated that organizations with better workplace health programs are linked to better stock performance, and is working with executives from the above companies on the best practices for reporting workplace health metrics. Disclosures would include health metrics collected either through monitoring or self-reporting. The group believes that just as more companies are disclosing the impact of their organizations on the environment, companies should also disclose their impact on the health of their employees.
Many believe in the fundamental connection between organizational performance and individuals' health and productivity. I certainly do! Isn't the investment in employer-sponsored health & well-being initiatives, when properly designed and executed, a business investment that impacts more than medical cost trend, but, also, affects absenteeism rates, presenteeism, disability costs, and employee engagement?
According to the Institute for Health and Productivity Management (IHPM), improving the health of the workforce is a fundamental competitive human capital management strategy. The Integrated Benefits Institute's work emphasizes that healthy, productive employees promote healthy business and is a good investment. Their research provides data, tools, and resources supporting the business value of workforce health and demonstrating the linkages between workforce health to employee lost time, performance, and business metrics.
However, should the aggregate "health" of the workforce be reported to shareholders? Do organizations define "health" all in the same way? What are the components of "workplace health metrics," and is there consistency among businesses? Do such metrics go well beyond physical health to include total well-being and how accurately, precisely, and representative of the organization would such captured data be (if indeed it can be captured)?
Employers already know some information about their workers' health, since they receive aggregate data on costs and spending, which can be an indicator of a workforce's health. But, is more specific data needed to be tracked and monitored? Some workplaces already are collecting data by providing their employees with their own tracking devices, such as Fitbits, or offering wellness programs that can make a impact on health, such as smoking-cessation plans.
Fitbit works with employers such as Indiana University Health and Emory University in Atlanta to subsidize fitness trackers for their staff. United Healthcare recently announced the company will be offering up to $1,460 a year in credits for his or her health reimbursement account for meeting daily goals while wearing a custom tracker. Its unique algorithm tracks the frequency and intensity of activity, and an employee can earn up to $1,460 a year for meeting certain fitness goals. The fitness device is offered as part of an employee's insurance premium. These programs are typically voluntary, but an individual must be willing to share data to earn the most rewards and insurance discounts.
According to a Harvard Business Review article, the author provides a myriad of issues explaining why disclosing aggregate health data to shareholders is a bad idea, everything from logistical challenges, privacy, discrimination, costs, low employee participation rates in health screenings, to a lack of correlation between health & the bottom line, along with a host of other unintended consequences that may result. There is also a great deal of controversy around wellness programs, for example, and whether they add value for companies, and hence shareholders.
Does the health of employees impact company performance? I think most organizations and individuals would argue that "yes," health affects productivity, employee engagement, and ultimately has a bearing on the company's bottom line. Most would also recognize the inherent challenges and numerous variables that are involved in assessing and measuring this but many organizations are making progress in this area.
Should companies track and report their employees' health to investors, though? That's an interesting proposition for consideration.