According to World Health Organisation (WHO), Air pollution is “contamination of the indoor or outdoor environment by any chemical, physical or biological agent that modifies the natural characteristics of the atmosphere.
It is a big environmental issue. But now it is not only limited to breathing bad air or resultant poor physical health but, it is also affecting the mental health, and productivity of workers at offices, and simultaneously bringing the stock market down.
Even for a day or two, but, air pollution affects emotional well-being and thus makes a person more depressed. Additionally, it weakens the cognitive capabilities of a person. It has a detrimental impact on how you feel and how well you think and it results in reducing the risk appetite. Lower returns are associated with poor risk tolerance and thus it affects the stock market directly or we can say indirectly.
Polluted air makes stock prices go down and vice-versa. Cleaner air stock prices will reflect the reality of the market way better.
According to Harvard Business Review (HBR), on days with more pollution than on days with less pollution, people do perform less across a range of tasks. Now the question arises what about the productivity of those workers who work indoors in front of the computer all day (Desk Job)? To find out this question Harvard Business Review (HBR) completed research at China’s largest travel agency i.e., “Ctrip”. The workers at “Ctrip” are not engaged in any factory nor in any farm, they are engaged in handling customer’s calls. Through research, they found that “Workers are considered as 5-6% more productive when the pollution levels by Environmental Protection Agency (EPA) is (AQI OF 0-50) in comparison to when they are rated as unhealthy (AQI of 150-200)”.
Thus our productivity is not wholly dependent on us. It is dependent on various factors including environmental and non-environmental both.
Now there’s a high need to look into the problem of air pollution. We need to start adopting practices both at home and at the workplace to make the air cleaner and better to protect health, productivity and returns.
Reference: https://hbr.org/2017/03/air-pollution-brings-down-the-stock-market?registration=success
https://hbr.org/2016/09/air-pollution-is-making-office-workers-less-productive