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December 6, 2018

Health as a Way of Doing Business

Author Affiliations
  • 1Harvard T.H. Chan School of Public Health, Boston, Massachusetts
  • 2Harvard Kennedy School, Cambridge, Massachusetts
  • 3Stanford University School of Medicine, Stanford, California
  • 4Graduate School of Business, Stanford, California
  • 5Harvard Business School, Boston, Massachusetts
JAMA. Published online December 6, 2018. doi:10.1001/jama.2018.18935

For too long, the worlds of business and health have been mired in a checkered, sometimes contentious, history. Millions of deaths worldwide can be attributed to risk factors including tobacco use, alcohol and drug misuse, and suboptimal dietary intake linked to commercial products. Media (including social media) coverage about the safety and cost of many consumer goods, both medical (drugs, devices) and nonmedical, reflect profound public concerns. Longstanding societal scrutiny about the role of business in environmental pollution has only increased in the era of global warming.

These and other issues have fueled public distrust about corporate practices. Conducted annually since 2001, the Edelman Trust Barometer Report notes that CEO credibility is hovering at all-time lows.1 Only 37% of 32 200 respondents in more than 20 countries in 2017 (38% in the United States) found CEOs credible,1 with 60% (2018) agreeing that CEOs are “driven more by greed than a desire to make a positive difference in the world.” Modern concerns, such as the deleterious effects of workplace stress on employee well-being, only perpetuate suspicion.

In this context, some companies are exploring innovative business strategies that seek more than to maximize short-term profit for shareholders. Given their financial and human capital, companies that change their ways of doing business could have a beneficial influence on societal outcomes. In particular, advancing a “culture of health” to embed and encourage well-being inside and outside company walls represents one potential strategy for creating long-term social value.2 Doing so could potentially enhance corporate trust, brand loyalty, and employee engagement, while meeting modern consumers’ rising expectations. A 2015 Nielsen survey of 60 countries found that among more than 30 000 consumers, perceived benefits for health and wellness influenced purchase decisions for 59%.3 Furthermore, 66% of consumers, and nearly three-quarters of individuals aged 19 to 34 years (as of 2015), so-called millennials, reported they would pay more for sustainable goods (2015) (up from 50% in 2013).3

To date, companies that have addressed health and other societal concerns usually have done so through a lens of philanthropy or corporate social responsibility, separate and distinct from maximizing profits. In contrast, an emerging business approach promotes efforts integral to profit maximization that also benefit society. This shared-value approach, proposed by Porter and Kramer,4 supports social objectives to gain long-term competitiveness and thereby create both business and social value.

Every business, knowingly or not, is in the health business. A shared-value approach can make that link explicit. For example, some companies in the cruise industry, which has long endured highly publicized health challenges (eg, norovirus outbreaks and life-threatening accidents), have recently established, and now prioritize, health, safety, and environmental goals. In addition, with motor vehicles linked to substantial carbon emissions as well as more than 40 000 deaths annually from motor vehicle crashes in the United States alone, several automobile companies are explicitly promoting long-term, health-related business goals. For example, Volvo’s president and CEO has publicly announced that by 2020, no one should be killed or seriously injured in a new Volvo car. General Motors’ CEO has announced a related company vision of “zero deaths, zero emissions, and zero congestion.”5

Businesses, together with health and community partners, can promote a culture of health through 4 distinct but interrelated pillars, as proposed by Quelch and Boudreau.2

Consumer Health

The decisions by CVS to change its name to CVS Health in 2014, discontinue tobacco sales in its 7800-plus US pharmacy stores, and conduct a smoking-cessation media campaign ties profits directly to its health mission. These actions were associated with a 12.9% increase in revenue and a 38% decreased likelihood of CVS-exclusive households to purchase cigarettes.6

Employee Health

Over several decades, Starbucks has engaged in a range of efforts to attract and retain employees. These include health coverage for part-time (and more recently for transgender) workers, as well as offering stock option programs, parental leave benefits, racial-bias training across its 8000 stores, 100% pay equity for women and people of all races performing similar work, and college tuition support in some instances (Arizona State). Such efforts likely contribute to Starbucks having among the lowest employee turnover rates within the quick-service restaurant industry.7

Community Health

Viewing its long-term success as dependent on the health of surrounding neighborhoods and with early research linking multisector population health activities to lower preventable death rates,8 Humana, for example, has added population-health improvement to its health insurance activities. Its Bold Goal initiative aims for 20% improvement in population health by 2020 by targeting priority conditions and social determinants of health in 9 member communities including San Antonio, Texas; Louisville, Kentucky; and Tampa Bay, Florida.2

Environmental Health

As part of a business strategy, more companies have sought US LEED (Leaders in Energy and Environmental Design) certification, the world’s most widely used green-building designation, which arose from collaborations between the business, health, and environmental fields, to promote healthier buildings. One study suggested that moving to a LEED-certified environment contributes to self-reported improvements in productivity as well as reductions in absenteeism and work hours affected by asthma, respiratory allergies, depression, and stress.9 Moreover, reflecting the growth of clean energy as a competitive business strategy, RE100 now includes 140 major multinational companies pledging to procure 100% of their energy from renewable sources by 2050.

Over the past 2 decades, companies worldwide have sought to demonstrate greater accountability regarding their commitment to sustainability, defined as the ability to meet today’s needs without sacrificing the needs of tomorrow. Increasingly, businesses are reporting environmental (eg, carbon emissions), social (eg, community giving), and governance (eg, board diversity) indicators (“ESG” measures) that complement traditional financial indicators (such as profits). Public frameworks such as the Global Reporting Initiative Sustainability Reporting Standards (including 93% of the world’s 250 largest corporations) and the US-based Sustainability Accounting Standards Board (including 79 industries) for public ESG reporting, in turn, make possible the generation of ratings indices (eg, Dow Jones Sustainability Indices) and financial products that encourage socially responsible investing.2 An ESG disclosure, encouraged in the United States by NASDAQ, is required by stock exchanges for some companies in other countries (such as the United Kingdom, France, and South Africa).

Positive ESG indicators could improve company reputations and business outcomes and influence decision-making by potential investors. One study of 180 US companies (1993-2009) found that companies adopting sustainability policies outperformed matched nonadopting counterparts with respect to stock market and accounting performance.10 Since 2014, Harvard Business Review has factored ESG measures into its CEO rankings.2 B Corps, founded in 2007, has certified more than 2600 companies from 60 countries that meet rigorous standards of social and environmental performance, accountability, and transparency. Since 2014, Fortune Magazine’s “Change the World List” annually recognizes 50 companies (with at least $1 billion in revenues) that have a social influence through their core business strategy as reflected by business results, degree of innovation, and corporate integration.

Against this backdrop, organizations such as the National Business Group on Health, US Chamber of Commerce Foundation Corporate Citizenship Center, Health Enhancement Research Organization, BSR (formerly Business for Social Responsibility), the National Academy of Medicine, and CECP (a CEO-led coalition of more than 200 of the world’s largest companies, cofounded by the late actor Paul Newman) now work to identify and implement best practices. While current ESG metrics and employee scorecards (eg, tracking absenteeism or flu vaccinations) aid assessment and monitoring, more integrated, validated, and industry-specific metrics are needed. The recent 2018 United Nations (UN) Global Compact focused on adapting UN Sustainable Development Goals to meaningfully complement business outcomes. Other efforts are exploring modifying measures from Healthy People 2020 and the County Health Rankings.

In short, global dynamics such as market forces, rising societal expectations, and innovative long-term strategies are pushing companies to consider social effects, including health, as a way of doing business. Such efforts are in their early stages, however, and many remain skeptical that business, historically blamed for a range of health problems, can ever contribute to solutions. Only further global debate, innovation, and evaluation can determine how the private sector can best improve public well-being and offer new directions for the future of population health.

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Article Information

Published Online: December 6, 2018. doi:10.1001/jama.2018.18935

Corrections: This article was corrected online December 13, 2018, to correct language in the first and 11th paragraphs.

Corresponding Author: Howard K. Koh, MD, MPH, Harvard T.H. Chan School of Public Health, 677 Huntington Ave, Kresge 401, Boston, MA 02115 (hkoh@hsph.harvard.edu).

Funding/Support: This work is funded, in part, by a grant from the Robert Wood Johnson Foundation.

Role of the Funder/Sponsor: The Robert Wood Johnson Foundation had no role in the preparation, review, or approval of the manuscript; and decision to submit the manuscript for publication.

Disclaimer: The opinions expressed in this article represent the authors’ personal views and do not reflect the position of Harvard University or Stanford University. Any reference to a business, product, or service does not represent endorsement.

Additional Contributions: We thank John Quelch, DBA, University of Miami; John McDonough, DrPH, Kirk Vanda, MBA, Leila Roumani, DMD, and Chelsea Heberlein, BS, Harvard T.H. Chan School of Public Health; George Serafeim, DBA, Harvard Business School, for their valuable insights and comments, for which they received no compensation.

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