A conversation about how businesses can help leaders and employees tackle wellbeing issues.
Covid-19 has brought the way we work and our ideas of wellbeing to the forefront. As some Australian cities plan to leave lockdown, businesses are thinking about what they can do to alleviate some of the current stressors and also prepare employees for any significant shocks in the future.
Wagestream spoke to Dr John McGill, who is Founder and Managing Director at Champions of Wellbeing, Inclusion, Diversity and Equality, about why financial wellbeing makes up an important part of our overall wellbeing and what businesses can do to help leaders and employees be better prepared to manage challenges.
Here's what he had to say.
First, I start from the perspective of self, and my own relationship to understanding personal finance. This has motivated my own journey around increasing my financial intelligence, and unpacking myths and misconceptions around money and finance from practical strategies that can make a difference to your own financial wellbeing. Another shift is to even conceptualise financial wellbeing as an aspect of wellbeing, when it is rarely discussed in that context. We often focus the wellbeing discussions solely around mental health, which are incredibly important discussions to have, however we seem to miss that many aspects of wellbeing, such as finances, are contributory factors to one’s mental health. This more expansive view of wellbeing is called holistic wellbeing, and part of my focus is helping others to understand that we have to monitor and protect our wellbeing across a variety of dimensions. I feel it’s important to share these insights with others, especially clients.
We know that some of the main stressors people have been experiencing, in addition to uncertainty and anxiety, as a result of the pandemic, are around employment, money and personal finance. Few people were prepared for the black swan event of a global pandemic that would impact their personal finances so profoundly and for so long. We know there are a high number of people that live pay cheque to pay cheque, regardless of how much they earn. This vulnerability around their finances creates a circumstance where people who have jobs are terrified of losing them, and people who have lost jobs are desperate to survive.
My role is to support leaders in creating environments of wellbeing, where these issues can be addressed, preferably before an event occurs that shatters someone’s foundations of safety.
Absolutely, this has long been considered a taboo topic. Most people struggle with personal finances, budgets and managing their money in a way that they don’t have to feel stress, yet very few discuss these topics openly. Even more challenging is for people leaders in a company to discuss finances with their team members. There are several reasons motivating the silence and fear around these discussions:
Firstly, very few leaders are properly equipped to have these discussions, as they may have their own challenges with finances, and may have received no training on how to conduct these conversations with others.
Secondly, discussions around finances are considered to be deeply personal. Underneath that layer for a lot of people is a sense of shame regarding their decision making. Very few people want to expose themselves to judgement. Also, if the organisation hasn’t made people feel safe, then many employees worry that any discussion around money will make them too vulnerable to the company, and open themselves up to being at the mercy of the company.
Thirdly, from an executive management perspective, there may be concerns regarding the appropriateness and legality of having discussions around finances, particularly if any of the discussions cross the line into financial advice, as opposed to, financial intelligence. Executive management may also be concerned about whether the discussions will open any floodgates to comparisons around pay, or lead to demands for greater pay.
The discussions around finances are occurring at an interesting time when there are also discussions regarding equality of pay and the exposure of pay disparity between different diverse groups. There are calls for transparency and each company has to weigh how to address those calls, as well as, examining their own processes.
My view is that transparent and open discussions around financial wellbeing benefit everyone as they provide opportunities for each person to become more financially stable and secure, relative to their personal circumstances.
Organisations can provide three key things: Safety, Empathy and Education.
1: Safety: It starts with organisations building trust with their employees. They have to put in efforts to create spaces where people feel comfortable sharing personal information without fear of reprisal. They have to demonstrate this trust by doing the things they say they’re going to do. And for financial wellbeing, it isn’t necessary for people to disclose the details of their financial situation, it is necessary for people to put their hand up to even participate in whatever interventions or programs are offered around financial wellbeing.
2. Empathy: Organisations have to “get it”. They have to understand they have employees who are struggling financially, even if it isn’t openly talked about. They have to stop treating finances as a dirty secret or taboo subject. People work to have money and meaning in life and then use those to fuel the other parts of their life. We can’t pretend that money doesn’t matter, it clearly does. Let’s use our empathy to inspire us to do something about one of the most powerful issues that impacts our employees. If we address this, we help employees feel more mentally safe to contribute to their work with less distractions and worries.
3. Education: Organisations have a variety of options to reach out and bring in people who can help their employees grow and learn around the concept of financial wellbeing, without violating any laws. There are courses on financial wellbeing. There are companies connected to the company’s benefit schemes, like superannuation providers or companies like Wagestream, that partner with businesses to deliver education as part of their package of benefits. There are organisations that help people address debt and how to budget.
What’s key is to bring in these various education interventions early, particularly early in the careers of people because that’s where education can deliver the greatest benefits with the least amount of work, through that magical power of compound interest. In recognition of that, organisations should have an awareness of the different life stages of their employees and bring in information and education that responds accordingly. Someone younger may need different messaging and different solutions than someone older.
At the end of the day, organisations need to care enough about their people to want to help and make a difference in their lives with the areas that truly matter. More and more that area is around financial wellbeing and security. Businesses that prioritise what their people prioritise start to see higher levels of engagement and staff satisfaction.