At KKR, we focus on improving a company’s operations and enhancing its value over a number of years.  A longer time horizon allows us to look beyond quarterly earnings and instead focus on long-term value creation. Using this approach, we work to identify multiple ways to enhance a business. Workplace wellness is an evolving area of focus for us with multiple benefits for companies – and the communities where they operate.

When I discuss KKR’s focus on wellness in the workplace, the conversation inevitably leads to the return on investment. I am asked: “Does this help you save money?  Do the savings justify the costs?  Are there other benefits you can receive?”  My answer to all three questions is, “Yes!”

Yes, wellness efforts can help save a company costs. Harvard Business Review identified this bottom line benefit in a December 2010 study titled, “What’s the Hard Return on Employee Wellness Programs?”  In the lead anecdote, HBR cited Johnson & Johnson’s estimate that wellness programs saved the company $250 million over 10 years, with a return of $2.71 for every dollar spent. The authors concluded that “the savings on health care costs alone make for an impressive ROI,” an exciting proposition for those companies focused on wellness initiatives.

But that’s just the beginning.  In addition to reducing health care spending and improving the bottom line, we believe that wellness programs can enhance a company’s top line. Effective wellness programs can enhance employee engagement, strengthen corporate culture, and improve recruitment.  Earlier this year, the National Business Group on Health and Optum, the health services platform of UnitedHealth Group, published a white paper titled “Beyond ROI: Building employee health & wellness value of investment,” which queried 275 large employers (mostly 3,000+ employees) as to why they offered a health and wellness program. Cost savings figured prominently in the replies, but the methodology also highlighted improving employee job satisfaction and attracting or retaining talented employees.

In a world where the war for talent is real, we want our firm and our portfolio companies to be employers of choice. Part of achieving this goal is ensuring that employees are healthy, happy and engaged.  Both physical health and a sense of well-being are critical inputs to this goal.

KKR started our wellness effort in 2011 with the premise that employees who undergo biometric screening and “know their numbers” (weight, BMI, cholesterol, etc.) will make better health decisions and be more productive at work. But knowing your numbers is just the beginning for us.  Companies like ours are working to build a sustainable culture of wellbeing and happiness, which is shaped by physical, psychological and financial determinants, as well as social, environmental, and interpersonal factors. We have a long-standing partnership with the American Heart Association and the University of Pennsylvania that has culminated in a research study intended to determine what factors are most important to creating value – for employers and employees – when it comes to wellness initiatives. Together we are working to create a community of best practices for our companies to learn from, along with a platform for idea exchange and tangible, relevant tools to create more effective wellness efforts.

The men and women who choose us and our companies over our competitors are committing a significant portion of each day to our success as an enterprise. Their loyalty, ability to deliver strong results, and their quality of life hinges far more on their overall health and happiness than it does on their resting heart rate. At KKR, we think that the value of investment for wellness is an idea whose time is long overdue. It is up to us and our peers to step up and work to improve the health of our companies, but equally important the health of our deeply interconnected communities.

Ken Mehlman is KKR’s Global Head of Public Affairs, helping the firm assess and improve the companies in which it invests by better understanding and managing geopolitical risk and engaging with their key stakeholders. He also oversees the firm’s global external affairs activities, including corporate marketing, regulatory affairs and public policy & communications. Mr. Mehlman leads KKR’s ESG programs for the firm and its portfolio companies.