Adopting Occupational Health and Safety Management Standards: The Impact on Financial Performance in Pharmaceutical Firms in China

Figures & data

Table 1 The Number of Occupational Disease Cases and the Death Tolls from Accidents Related to Workplace Safety Reported in China, 2006–2018

Year	The Reported Numbers of Occupational Disease Cases	The Reported Death Tolls from Accidents Related to Workplace Safety
2018	23,497	34,672
2017	26,756	38,766
2016	29,420	41,902
2015	29,180	66,182
2014	29,972	68,061
2013	26,393	69,434
2012	27,420	71,983
2011	29,879	75,572
2010	27,240	79,552
2009	18,128	83,196
2008	13,744	91,172
2007	14,296	101,480
2006	11,519	111,822

Note: The source of the data is the National Health Commission of China.²

Table 2 Serious OHS Accidents in Pharmaceutical Firms in China, 2010–2019

Year	Serious OHS Accident	Consequence
2019	An explosion at the freeze-drying plant in Qilu-tianhe Pharma in Shandong Province	Ten workers died and 12 workers were seriously injured
2019	An explosion at the glutamine production line in Shenhua Pharma in Jiangsu Province	Eight workers were injured and one worker died after being rescued
2018	A flash explosion within the catalyst removal process of hydrogenation in Yangzi Pharma in Jiangsu Province	One worker died and a loss of 1.4 million Chinese yuan was incurred
2017	A fire at the tincture plant in Hansen Pharma in Hunan Province	Two workers died and three workers were seriously injured
2017	A fire at the Neurontin-manufacturing plant in Tonghe Pharma in Jiangxi Province	One worker died and one worker received minor injuries
2015	A fire at the extraction plant in Livzon Pharma in Ningxia Autonomous Region	Four workers suffered burns; one of them suffered severe burns
2014	An explosion of the drying oven at the solid preparation plant in Huigu Pharma in Hainan Province	Four workers died and 10 workers were injured
2014	An explosion at the boiler in Huayi Pharma in Zhejiang Province	Three workers were injured, and the burned area was over 400 square meters
2013	An explosion of the hot air circulation oven in Tiancian Pharma in Shanxi Province	Five workers received minor injuries
2012	An explosion in the reaction cauldron in lvyuan Pharma in Hubei Province	Two workers died and 26 workers were injured
2011	An explosion of the pressurised container in Hanpu Pharma in Guangdong Province	One worker died and four workers were seriously injured
2010	An explosion at the tablet plant in Quanxin Pharma in Yunan Province	Five workers died and eight workers were injured, including two workers who suffered moderate burns

Note: The source of the data is the National Health Commission of China.²

Table 3 The Stratification of Sample Firms by Ownership Structure and Number of Employees

	Number (%) of Sample Firms
Ownership structure
Private	87 (69.60)
State-owned	35 (28.00)
Other (Privatising stated-owned)	3 (2.40)
Number of employees
Less than 1,000	18 (14.40)
Between 1,001 and 5,000	73 (58.40)
Between 5,001 and 10,000	21 (16.80)
More than 10,000	13 (10.40)

Table 4 Constructs of the Variables

Variables	Measurement
OHSMS	A dummy variable 1 for firms adopting an OHSMS standard; 0 for firms without adoption
ROA	Return on assets = net income/total average assets
ROE	Return on equity = net income/total average equity
EPS	Earnings per share = (net income - preferred dividends)/weighted average shares outstanding
LNTA	Natural logarithm of total assets

Table 5 The Number of Sample Firms Adopting an OHSMS Standard (Certified with the OHSAS 18001 and the ISO 45001), 2010–2018

Indices	2010	2011	2012	2013	2014	2015	2016	2017	2018
Number of sample firms with the OHSAS 18001 certification	23	25	37	53	68	82	88	89	89 (5 firms transited to the ISO 45001 since 12 June 2018)
Number of sample firms with the ISO 45001 certification									6 (5 firms transited from the OHSAS 18001 and one firm newly certified with the ISO 45001)

Table 6 Descriptive Statistics

Variables	No. of Observations	Median	Mean	Min.	Max.	SD	Skewness
OHSMS	1125	0.000	0.413	0.000	1.000	0.709	0.1.937
ROA	1125	0.074	0.068	−0.459	0.354	0.084	0.047
ROE	1125	0.109	0.077	−0.393	1.357	0.147	3.969
EPS	1125	0.595	0.516	−0.610	3.021	0.583	1.307
LNTA	1125	21.304	21.101	19.016	23.558	0.930	0.184

Table 7 Correlation Analysis

	ROA	ROE	EPS	LNTA	OHSAS
ROA	1
ROE	0.903***	1
EPS	0.676***	0.695***	1
LNTA	0.037 *	0.292***	0.570***	1
OHSMS	0.452***	0.288***	0.324***	0.275***	1

Notes: ***p < 0.01; *p < 0.10.

Table 8 Regression Models: Effect of OHSMS on Contemporaneous Financial Performance

	Dependent Variables
	ROA	ROE	EPS
Independent variable
OHSMS	0.0237***	0.0615**	0.0359**
Control variable
Size	0.0359	−0.0019	0.5764**
Constant	0.1316***	0.0075	0.0578**
Adjusted R^2	0.3958	0.0102	0.6026
F-statistics	6.4340***	3.853	8.5542***
Durbin–Watson	1.7091	2.8329	1.8371
Hausman specification test	25.6841 ***	1.952	23.972 ***
Observations	1125	1125	1125

Notes: ***p < 0.01; **p < 0.05; The 95% CI: ROA as dependent variable (0.0196,0.0279), ROE as dependent variable (0.0493,0.0738), EPS as dependent variable (0.0151,0.0567).

Abbreviations: ROA, return on assets; ROI, return on equity; EPS, earnings per share; LNTA, natural logarithm of total assets; CI, confidence interval.

Table 9 Regression Models: Effect of OHSMS on Subsequent Financial Performance

	Dependent Variables
	ROA	ROE	EPS	ROA	ROE	EPS
Time Lag	t-1			t-2
Independent variable
OHSMSt−1	0.0194	0.0275**	−0.0605
OHSMSt−2				−0.0318	−0.0193	−0.0296**
Control variable
Size	0.0315	0,0194*	0.2691***	0.0194	0.0258	0.4740***
Constant	0.1052	0.0957	−0.1335***	0.0498	0.0057	−0.2887***
Adjusted R^2	0.3817	0.0012	0.5679	0.3919	0.0003	0.5957
F-statistics	4.1328***	1.6739	8.0195***	4.6072***	1.0683	8.734***
Durbin–Watson	1.6475	1.9726	1.5903	1.8140	1.3847	1.9522
Hausman test	38.4104***	2.8505	35.2367***	38.3893***	2.7424	39.9602***
Observations	1125	1125	1125	1125	1125	1125

Notes: ***p < 0.01; **p < 0.05; *p < 0.10; The 95% CI: t-1 model, ROA as independent variable (0.0017,0.0372), ROE as independent variable (0.0095,0.0456), EPS as independent variable (−0.1508,0.0297); t-2 model, ROA as independent variable (−0.1076,0.0440), ROE as independent variable (−0.0234,-0.0152), EPS as independent variable (−0.0718,0.0125).

Abbreviations: ROA, return on assets; ROI, return on equity; EPS, earnings per share; LNTA, natural logarithm of total assets; CI, confidence interval.

National Health Commission of China. The report of health China of 2019. 2019 Available from: http://www.nhc.gov.cn/guihuaxxs/jkzgxdzt/xkzgxd.shtml. Accessed 715, 2019.

 Google Scholar