An August 19, 2019 article by David Goldman of CNN Business points out that America’s CEOs said, “corporations are responsible for improving society by serving all stakeholders ethically, morally, and fairly.” Jamie Dimon, CEO of JPMorgan, states that, “Major employers are investing in their workers and communities because they know it is the only way to be successful over the long term.”
For now, it’s just talk. The article calls the statements, “significant, if mainly symbolic.” The challenge has always been finding a way to take care of people without breaking the bank. For many companies, labor is the largest line item on their balance sheet, especially when factoring in associated costs such as benefits, administration, safety, office space…it seems like a never-ending list.
For decades, companies have been focused on maximizing shareholder profit. Stock prices have been used to benchmark performance and compensate executives, earnings reports are obsessed over by wall street, and massive expense cuts—including workforce layoffs—are cheered as boons to company profits.
That thinking is starting to change. In their 2017 masterpiece Completing Capitalism, authors Bruno Roche and Jay Jakub argue that the pure profit motive is outdated. Their tested and proven hypothesis is that sustained success requires a commitment to human, social, and natural capital along with financial capital.
Employee Care is how you invest in your people to address the human capital objective. It means providing the necessary tools and guidance to allow your team to operate at their highest level—both at work and at home. It does not mean excessive labor costs. It means building a culture that decreases hidden costs and risks like turnover, lost productivity, and health risks.
A 2017 University of Pittsburgh study demonstrated a causal relationship between employees who are concerned about their financial situation and their performance, safety, and well-being. The “detrimental effects on working memory” from financial worry caused preventable accidents, reduced productivity, increased turnover, and correlated strongly with health decline issues.
Providing the right benefits in the right manner helps ease the burdens and concerns people feel every day about money, health, and their future security. This means giving employees a platform that helps them track their progress and rewards them in real-time for making positive behavioral choices, and then goes a step further and provides them with a personal coach who can answer questions specific to their personal circumstances and help them identify the gaps and opportunities available to them.
Let’s hope Jamie Dimon and America’s CEOs start implementing employee care programs that are meaningfully different from what we’ve been doing for decades. The data proves that properly investing in human capital leads directly to more profit—and that’s a balance worth finding.