Abstract
The prevalence of non-communicable diseases is rising exponentially within the emerging market of South Africa. Diabetes is one of the leading causes of death and disability followed closely by cardiovascular disease. As a result this is creating a tremendous economic burden on the economy and civil society. This research seeks to explore the relationship between the health of employees and the influence this has on the financial performance of companies. Discovery’s HCI (Healthy Company Index) was used to select the healthiest constituent companies listed on the Johannesburg Stock Exchange (JSE), and pit these against comparable enterprises who do not employ best practices regarding work health promotion. In total, 18 companies were selected and financial data was used to assess performance and explore the relationship using two different research methodologies (panel regression analysis and portfolio theory). The results showed that the healthy companies outperformed the comparable companies in both models; this suggests that not only does the market reward these practices, it can translate to better performance on the balance sheet. Limitations included a small sample size as well as assumptions about the health of employees.
M.Com. (Finance)