Put health on the balance sheet

Occupational health professionals are urging the Government to take up Dame Carol Black\'s recommendation that employee health and wellbeing should be reflected on companies\' balance sheets.

Her report calls for the Government, employers and other representative bodies to develop a robust model for measuring and reporting on the benefits of employer investment in health and wellbeing, and for employers to add this information into their accounts.

Dudley Lusted, head of corporate healthcare development at Axa PPP healthcare says both frequency of sickness absence and the extent of long term absence should feature in employers’ accounting for staff performance in audited results.

He also wants to see companies required to reveal the amount per year per employee they spend on employee health and wellbeing through provision of medical and dental cover, occupational health services, employee assistance and support programmes and subsidised gym and fitness membership.

Lusted is also calling for figures on employee turnover, line manager training procedures and employees’ perception of wellbeing and engagement to be included . This information could be based on confidential self-reported questionnaires.

Industry professionals are hoping Black’s report signals a renaissance for the idea of getting human capital management on company balance sheets. In 2006 then chancellor Gordon Brown pulled the plug on the ‘Accounting for People’ project that proposed similar accounting requirements and which had received wide backing across a range of stakeholders.

Lusted says: “These issues are of real importance to the investment community. Year-in year-out the companies in the Sunday Times 100 best employers list outperform their sector in terms of profitability. How many people did you kill, how many did you make sick are all key questions that investors should know about the companies they are looking to invest in.”

Steve Ellis, senior manager at Premier Choice Employee Benefits says: “Employers have got to start taking responsibility for their employees’ health and wellbeing. It is good for their own profitability and reduces the burden on the state. I would like to see accounting for people get the same level of profile as corporate social responsibility. Once it appears on the balance sheet employers find it a lot harder to bury their heads in the sand on what is after all a serious issue.”