AS the job market improves, employees are looking around for other options. They want more than just a fair and competitive salary; they are looking for a fulfilling and supportive work environment too. At the same time, attention on managing staff costs, through slashing head counts, freezing pay and cutting bonuses is being replaced by the need to retain and incentivise colleagues.
Research conducted by Financial Director in association with financial protection specialist Unum finds that of the 250 senior finance professionals surveyed, more than half cite staff retention and recruitment as the most pressing business concern they expect to face over the next 12 months. However, less consideration is given to managing employees’ health in the workplace despite employees now expecting their employer to do more to look after them.
This has changed over the past few years, indicating that an FD today needs to be much more aware of employee issues. Employee wellbeing sits higher on the corporate agenda than five years ago, while the overwhelming majority of FDs (86%) surveyed consider the management of employee wellbeing to be part of their role, a view at a roundtable hosted by Financial Director and Unum.
“Corporate culture has changed and within my organisation the realisation about engagement kicked in,” says Mike Norman, CFO at BNP Paribas Securities Services. “Large, small, medium organisations are realising how important engagement is. As cultures promote wellness, staff will become more self-aware of what they want and will ask for more non-financial incentives.”
Setting an effective wellbeing strategy involves more than just the HR team; it takes in factors such as great leadership, open culture and flexible workplace practices. This requires working across different functions, explains Steve Harry, CFO at Unum.
“It has to be tailored. It has to be something that works in your environment in your organisation. You’ve got to think about the practical implementation challenges,” he says. “There’s the need to line up squarely behind a wellbeing strategy that you can interpret in your own organisation and that the management own – and you can be seen to be owning it.”
But there remains a real mix of opinion about where responsibility towards employee wellbeing should lie. Almost 60% of FDs cite “the whole management team” as being the group on whose shoulders responsibility for employee wellbeing should mostly lie. Only 8% believe responsibility should lie with HR, compared to 12% who believe it is the employee’s duty and 13% who believe it is the job of line managers.
“It’s not just the directors or senior managers; it’s really people with responsibility,” says Noel Mansell, FD at The Advantage Travel Partnership. “It does cascade down but everyone has a duty to ensure staff across the whole business are empowered, motivated.”
Nevertheless, finance professionals continue to spend limited amounts of time and attention on the issue. FDs most commonly spend up to a week a year on matters concerning staff wellbeing, with only a small minority devoting more than a month a year to the issue. As wellbeing does become much more of a corporate issue, FDs will need to reassess this and give more time to issues of wellbeing.
“If you’re the CFO, you have your expert subject, but you’re part of the executive team and the finances could look very well in the short term but there could be a car crash coming if your sales force isn’t motivated,” Norman says. “You’ve got to keep every part of the machine motivated.”
What employees want
But how to create a caring company and how should it behave towards its staff? The common view is one which builds its success on the foundation of happy and engaged employees. This shows the trend towards companies becoming more employee-centric. Organisations are recognising that they need to look after their employees more effectively, protecting their most important asset.
Download our Whitepapers
So what makes employees happy and engaged? And what, in terms of staff retention, most contributes to staff loyalty? Mansell says his company uses annual staff opinion surveys. “They’re good and bad because with some people how they’ll answer depends on their level of honesty, and probably their own state of mind. Those things are a gauge but you’ve got very careful interpreting the results,” he says.
The most important, factors to employee loyalty are “feeling empowered to do their job,” having “a good relationship with line managers” and “feeling part of a team”. Conversely, “a good bonus” is felt to be least important. Providing financial support to colleagues in the event of illness is also ranked of medium importance, along with a desire that the employer should help look after the mental and physical health of its employees. In addition to providing a pensions scheme, the importance of medical and life insurance along with income protection insurance and critical illness cover is regularly cited.
“I think of wellness as a broader concept and you’d probably look at a package of things in terms of assessing the wellness of the company; enabling, legitimising things like flexible working, empowering people in their jobs are all part of feeling good about yourself. But our role is to provide the right benefit package alongside that,” says Harry at Unum.
Overall, FDs agree most strongly with the idea that the employee benefits their organisation offer communicate to employees that they are valued and of high worth, but are undecided on the matter of employee benefits creating value for the business.
“It’s not about how much budget you have; it’s about what the right package is for your circumstances in your business. If you’ve got a really good brand name, people love coming to work for you – people want to go and work for Google, and it’s probably really stressful, but people think at Google you can go and have fun when you work there,” explains Mansell.
At the same time, FDs are split about whether it is simply the duty of employers to “inform and advise employees” on benefits but, ultimately, it is “their responsibility” to look after themselves.
Joan Xavier, divisional business manager at King’s College, says it’s all about the advice because “that’s the bit that’s dropped out of the market”.
“As an individual, if you want to go and search out your financial safety net, it’s almost like a den of vipers now. You’ve actually got more punch, and more chance of reaching out to the right professional to say to your employees, ‘This is part of the offer,’” she says.
Clearly, FDs are becoming more and more engaged with setting and executing wellbeing strategy. Whereas employee benefits were once viewed through the prism of a cost centre and were calculated as a percentage of salary, the overwhelming majority of senior finance professionals now consider the management of employee wellbeing as part of their job. As the workforce becomes demographically older, finance directors and their finance functions will need to devote increasing amounts of time to this area.
Nevertheless, it is clear that matters of health – whether addressed through cycle schemes or insurance products – remain a key pillar in developing a comprehensive wellbeing strategy that embodies the genetics of a caring company: a business which builds its success on the foundation of happy and engaged employees. ?