Employee benefits are set to play a key role in solving societal issues ranging from increasing access to healthcare to preparing for environmental disasters
The benefits employers provide their people with can play a key role in tackling environmental, social and governance (ESG) issues. That was the key message to emerge from a forum Mercer Marsh Benefits (MMB) hosted to bring UK health and protection providers together to debate their role in supporting ESG agendas.
Opening the ESG Forum, Dr Lorna Friedman, a senior MMB partner and ESG expert, discussed how employee benefits help address societal issues and contribute to an organizations ESG goals by expanding access to mental health supports and addressing the disparities in health services.
“If you look at the employee benefits now being offered to frontline workers, they are creating financial and social inclusion,” said Lorna. “There are now holistic propositions around mental health support, yet somehow HR and benefits are viewed as separate when they are at the heart of ESG. Every time a benefits provider helps an employer extend mental healthcare to someone who couldn’t access this otherwise, they’re an ESG champion.”
Chris Bailey, UK Region Leader, MMB, agreed that employers now want to be much more inclusive about the benefits they offer “Since the pandemic, traditionally underrepresented employees, such as nurses, shop assistants and drivers, have been recognised. Employers no longer want to be hierarchical and want to do more for everyone but might not want to increase spend. That’s requiring employee benefits providers to think more creatively about ways to spread existing cover more fairly.”
“We can learn from the pension space,” added Nick McMenemy, a partner at MMB, “Employers and employees are increasingly inquiring about ESG funds in their retirement investments and oftentimes are opting to work with providers that integrate ESG factors in the investment options, so there’s precedent for getting this right.”
How can employee benefits providers help tackle ESG issues?
A major challenge for benefits providers is anticipated to be creating a shared framework, targets and common definitions, to move towards some form of standardisation for ESG. Another is keeping the conversation going.
“It can’t be a one-way street with employers left to drive ESG agendas forward alone,” said one delegate. “Benefits providers should also be the ones to ask about ESG and have it as a standing item on the agenda post-placement,” agreed another.
Chris agreed, saying, “UK benefits providers are majorly trusted brands. We have an opportunity to lead thinking for the healthcare industry and inspire employers to want to put the ‘S’ into ESG. There is a need for sustainable and equitable healthcare solutions that focus on prevention and not just acute care.”
Supporting employees after a crisis
The audience also debated the importance of supporting employees in a crisis, agreeing that family members would become an employee’s priority in an emergency. Data shared during the event revealed that seven out of ten UK employees believe their employer would support them in an emergency or time of need.
However, HR needs to be brought into crisis planning conversations urged Lorna, “We talk to clients about the vulnerability of their supply chains, and how prepared their physical sites are for increasing climate challenges. Clearly, employee vulnerability and support need to be part of that conversation; HR needs to be at the table to discuss the importance of mitigating people risk.”
Insurers will also have to think about preparedness when it comes to disasters. “The UK is already experiencing the consequences of flooding,” warned Lorna. “More work needs to go into assessing the hazards and risks this represents to employees. That’s only going to get more complicated, so the more we can anticipate ESG risks and be prepared to deliver digitally enabled healthcare and mental health support, that can reach people more quickly, the better. Parametric policies, which have the potential to facilitate cash to employers and employees affected by a disaster, will also have a role to play.”
Three key takeaways:
- Providers and intermediaries have a key role to play in helping clients tackle ESG issues, including increasing access to healthcare and preparing for climate events.
- ESG needs to be a two-way street, with ESG made an ongoing part of the placement conversation.
- HR needs to be brought into crisis planning conversations and providers need to anticipate people risks related to climate change and innovate new products, that can respond more quickly after a crisis.
- Market Development Leader, UK, Mercer Marsh Benefits
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