CEOs concerned about workplace wellness

by 06 Mar 2007

AS WORK becomes more sedentary, the global workforce is becoming fatter, sicker and less productive due to chronic conditions such as heart disease and diabetes, according to a recent report.

Prepared by the PricewaterhouseCoopers Health Research Institute in conjunction with the World Economic Forum, the report identified chronic disease as a growing and costly threat to corporations and their workers.

It called on global CEOs to make wellness central to their corporate business strategy, suggesting that multinational employers have the greatest stake in, and best opportunity to prevent, chronic disease.

According to PricewaterhouseCoopers, too little attention is being paid to preventing chronic diseases, as only 3 per cent of spending in industrialised nations goes toward prevention.

“Traditionally it has been governments, not employers, that have been responsible for managing the major global health risks,” said Jim Henry, global leader for healthcare, PricewaterhouseCoopers.

“The focus and funding have long been on infectious diseases such as AIDS and malaria, as well as maternal deaths and diseases of the poor and malnourished. But the prevention of chronic diseases has been chronically under-funded.

“As we get older, fatter and less active, the weight of the world is falling on the bottom lines of the world’s largest companies in the form of reduced productivity, increased tax burdens and declining competitiveness.”

Chronic disease, including cardiovascular diseases (stroke and heart disease), cancer, chronic respiratory diseases and diabetes, caused 60 per cent of deaths worldwide in 2005.

Deaths from chronic diseases will increase worldwide by 17 per cent between 2005 and 2015. At the same time, deaths from infectious diseases, maternal and perinatal conditions and nutritional deficiencies combined are projected to decline by 3 per cent.

The economic toll of chronic disease for developing and developed nations around the world is estimated at approximately 3 per cent of gross domestic product, globally.

The world now has more people who are overweight than hungry, according to the report. Preventable risk factors such as poor diet, lack of physical activity, stress and smoking are the biggest contributors to chronic disease.

The report found that approximately 2 per cent of capital spent on workforce is lost to disability, absenteeism and presenteeism (diminished productivity from ill employees who go to work but work below par) due to chronic disease. Combined, these indirect costs are more than the additional direct medical claim costs that some employers incur.

“There are quantifiable benefits from using wellness programs to attract and retain talented, healthy employees,” said Simon Leary, partner, PricewaterhouseCoopers.

“You can improve the health and wellbeing of your workers while also bolstering your bottom line. The economic case for prevention is overwhelming.”

As part of its research, PricewaterhouseCoopers conducted a survey on wellness programs among multinational employers representing more than 3 million employees worldwide and found a growing emphasis on health prevention in the workplace.

More than half of the multinational corporations surveyed expect to introduce or expand corporate wellness programs over the next five years. One-third are rolling out comprehensive wellness programs in multiple countries, while another 17 per cent are rolling out a single wellness program in multiple countries.

Corporate wellness programs have been shown to provide a 3-to-1 return on investment, the report found.

The two leading reasons cited for promoting wellness were “reducing indirect costs associated with absenteeism, presenteeism, disability and workers’compensation” and “improving work performance, such as productivity and quality”.

“Reducing direct healthcare costs”was cited as the third most important reason, followed in order of importance by “the desire to improve the image of the company internally (for retention purposes)”.


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