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- Title
The Stock Performance of American Companies Investing in a Culture of Health.
- Authors
Goetzel, Ron Z.; Fabius, Raymond; Roemer, Enid Chung; Kent, Karen B.; Berko, Jeffrey; Head, Michael A.; Henke, Rachel Mosher
- Abstract
<bold>Purpose: </bold>We investigated the relationship between companies' efforts to build internal (COH-INT) and external cultures of health (COH-EXT) and their stock performance.<bold>Design: </bold>We administered 2 surveys, which measure companies' programs, policies, and supports for improving the health of their employees and communities. We then compared the companies' stock performance to the Standard and Poor's (S&P) 500 Index from January 2013 through August 2017.<bold>Setting: </bold>United States.<bold>Participants: </bold>Representatives from 17 publicly traded companies who completed the COH-INT survey, of whom 14 also completed the COH-EXT.<bold>Measures: </bold>Culture of health scores were dichotomized into high versus low for both surveys. Stock price data for all companies were gathered from public sources.<bold>Analysis: </bold>We constructed 5 stock portfolios: all 17 companies, high COH-INT, low COH-INT, high COH-EXT, and low COH-EXT companies. We examined total returns for each portfolio compared to the S&P 500.<bold>Results: </bold>High COH-INT companies' stock price appreciated by 115% compared to the S&P benchmark (+69%), while low COH-INT companies appreciated only 43%. In contrast, high COH-EXT companies underperformed (+44%) when compared to the S&P 500 (+69%) and low COH-EXT companies (+89%).<bold>Conclusion: </bold>This study supports the view that employers' efforts to build an internal culture of health is a sound business strategy. More research is needed, however, to establish whether a link exists between supporting healthy community initiatives and company stock performance.
- Subjects
UNITED States; S &; P Global Ratings Inc.; STANDARD &; Poor's 500 Index; CULTURE; STOCK prices; INDUSTRIAL statistics; INDUSTRIES &; economics; COMPARATIVE studies; CORPORATE culture; HEALTH promotion; INDUSTRIAL hygiene; RESEARCH methodology; MEDICAL cooperation; PUBLIC health; RESEARCH; EVALUATION research
- Publication
American Journal of Health Promotion, 2019, Vol 33, Issue 3, p439
- ISSN
0890-1171
- Publication type
journal article
- DOI
10.1177/0890117118824818