The environmental, social and governance (ESG) credentials of benefits providers have become increasingly important to employers, according to Grid.
The industry body said that this is impacting decisions when employers are choosing an employee benefits partner.
Grid research showed that 86 percent of employers said that it is either a ‘priority’ or ‘fairly important’ to work with a provider or service that has a strong ESG policy. This is an increase of 34 percent over the past 12 months, showing that businesses recognise the value of including ESG policies in their HR operations.
Research results also revealed that 88 percent of employers think that partnering with companies that have a strong ESG policy is important to their workforce. This percentage is also a significant increase on last year when 62 percent agreed with this view.
Katharine Moxham, spokesperson for Grid, said: “ESG is going to be increasingly important to businesses of all sizes, but in many cases, the social responsibility element has played second fiddle to environmental and governance concerns. HR departments can rectify this, and increase their focus on social responsibility, by focussing on the wellbeing of their staff.”
Grid said that group risk benefits can play a key role in supporting greater social responsibility by helping companies comply with the social element of an ESG policy.
Group risk benefits, which includes life assurance, income protection and critical illness, are set up to support all staff because of their relative affordability for employers in contrast to private medical insurance, “which may be ring fenced for certain management-level staff”, Grid said.
Once staff are covered by these benefits they have continuity of cover without having to renew each year, which helps ensure the maximum number of staff have cover regardless of position or paygrade.
The embedded support services that are part of these benefits can offer regular support, which is crucial given the pressure on publicly funded healthcare. Grid said that an employer can be seen to be doing social good when it takes some of that burden away from the NHS to offer healthcare and wellbeing services to staff directly.
Moxham said: “Negative practices towards staff can be harmful to the reputation of an organisation but the opposite is also true. Looking after the wellbeing of staff is not just the right thing to do, or something that ticks a social responsibility box, but it has a fundamentally positive impact on the organisation.
“It’s also important to consider that if employers are judging their partners on ESG credentials, then the potential customers or clients of the employer will also be doing the same. The social aspect of ESG can be the more challenging of the three areas, but caring employers who support the health and wellbeing of all their staff will find they are helping their organisation meet their ESG intentions while also retaining healthy, happy and productive staff.”
