The Challenge and Benefits of Fostering the Mental and Financial Well-Being of Employees Worldwide | Magazine
Financial worries are a major source of stress for employees
Another recent report from Champion Health found that 30% of employees cited financial well-being as a cause of stress outside of work. The 2022 Occupational Health Report suggests that many employees are still struggling, despite organizations’ best efforts.“Money worries impact both an employee’s physical and mental health, which inevitably impacts their job performance,” says Laura Dallas, Champion’s Chief Wellness Officer. “In these uncertain times, providing financial wellness support is vital, both from a moral and business perspective.”There is an inherent link between productivity and employee well-being. Morale and productivity decline when an employee faces a lot of stress because it has a huge effect on time and intellectual capacity, says Harriet Shepherd, financial wellness manager at St. James’s Place Financial Advisors.“It’s impossible to set aside time outside of the workday to mentally deal with financial issues,” she says. “Financial worries don’t go away just because you’re at work.”While it’s important to pay attention and understand this, it’s also important to realize the business impact it has as well. It is therefore in everyone’s interest that these bodies be reduced and that people feel supported.
Good financial well-being, a key element of ESG
A key trend that has accelerated over the past 12 months is a closer look at the impact organizations are having in terms of ESG credentials.Instilling good financial well-being is not just a “good” thing to do, it is one aspect of a company’s environmental, social and governance (ESG) considerations. The “S” component of ESG covers the relationships companies have with employees, customers, suppliers and the wider community. “The Covid-19 pandemic has also put employee wellbeing high on the list of issues investors are looking at in companies from an ESG perspective,” says Harriet Shepherd. “This means that employee well-being is no longer just an internal issue. Companies need to be able to show what they are doing to support employee well-being because they are more accountable than ever. »The relationship an employee has with their finances can have a substantial impact on their well-being. According to a Close Brothers report published in March 2019, nearly nine in ten large UK companies say they have been affected by the poor financial well-being of their employees, due to outcomes such as lower productivity, loss of talents and more short-term and long-term absences. .Financial well-being depends not only on the amount of money you have, but also on the financial security, confidence and independence you have.“Improving financial well-being is vital for any company that is committed to supporting the mental health of its employees,” says Harriet Shepherd. But what support can a company provide to an employee? Part of it is emotional support, but there’s also a practical element to it, especially when it comes to building financial confidence and well-being.In some cases, this will start with financial education and providing people with the tools to manage their finances effectively. “Financial education is also about effectively communicating existing reward packages and ensuring employee buy-in,” she says.“Employees often need help when making decisions about these opportunities. Just look at how many people are still in their pension plan’s default fund. While this is fine with some, it more often indicates that they haven’t considered their retirement or even their benefits package to figure out what would be best for them.
Finding the right work/life balance
As employees return to the office, the balance between work, life, finances and family is highlighted. Global talent managers, who are responsible for disparate teams in many geographies, struggle to juggle trying to meet different needs and demands.Yet right now, people leaders have an unprecedented chance to make workplaces more productive, supportive and agile, says Janice Burns, director of human resources at learning platform Degreed, a tech company. edtech/HRtech with over 600 global workers and employees based in the United States and Canada. , UK, LATAM, APAC, Europe and Australia.“In a time of great change, workplaces are not just made up of permanent employees, but many different work styles in a hybrid setup,” she says. “Even more so for companies whose employees are based around the world, internal efforts should reflect the different opportunities, challenges and perspectives of all regions.”She argues that employees should have the freedom to adapt their working hours to their family, care and learning commitments, and to adapt their work environment to their needs and make the company a place to work. pleasant. This should be the case regardless of location, while protecting work/life balance and taking into account different time zones and cultures.“Increasingly, employers are moving beyond managing the employee experience to supporting their entire life experience and understanding employees as holistic individuals, with families, hobbies and other personal lives, will result in higher performance, loyalty and retention,” she adds.To reflect the importance of physical and mental health and overall wellness in the workplace, the Degreed’s People team has introduced a monthly wellness benefit of $75 per month (or equivalent in the country). Employees have a wide range of options and can spend the money however they want on wellness services.
What are the deeper issues related to financial well-being?
While this sounds great in theory, not every company has the inclination or expertise to put it into practice.“Rather than addressing the root causes of major existing problems, which is unpleasant and requires efforts to change organizational processes and systems, many employers are influenced by eccentric wellness providers to put implementing wellness initiatives that polish their brand but are often low-effort and low-impact,” says Chris Priebe, CEO of Zelt, a people management company.“Employees often don’t understand workplace pensions either,” he says. “The result is usually that employees end up on pension plans that have poor returns or a return profile that doesn’t suit their age or lifestyle.“The solution is to implement better software that integrates the pension into the employee system, so employees can see what they’re contributing, how they can access it, and make choices.”
How Implementing Personal Finance Education and Training Can Reduce Workplace Stress
A recent CIPHR survey of stress at work found that one in five people in the UK feel stressed on more days a month than they don’t.Much of this stress can be underpinned by issues related to financial illiteracy. Although employers are not necessarily responsible for managing their staff’s personal finances, training employees on best practices can be mutually beneficial.“Stress and poor mental health resulting from stress represent an increase in absenteeism, so there is a clear benefit for business leaders to incorporate financial education into workplace wellness strategies,” says Nick Gold, Managing Director of the International Speakers Bureau, Speakers’ Corner. .“Not only will this reduce employee stress by making them more focused and reliable, but the budgeting and management skills learned through financial literacy can be applied and practiced in many roles.”
Read more about the big comeback in Think Global People’s Spring 2022 issue.
To explore the growing importance of workplace wellbeing more broadly, why not join us on June 9 for the results of the Think Global People and Relocate Awards and the Future of Work Festival?
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