Many organizations worldwide have recently advocated and actively enhanced overall employee well-being to the heart of their HR strategies. In previous years, benefits to improve employee’s emotional and physical health were essential, with a focus on employee wellness, particularly during the pandemic. However, the current global economic situation – inflation, a potential new COVID wave, and increased resignations together with skill migration – requires employers to find ways to upgrade or introduce financial wellness benefits to their people.It is critical to creating a healthy workplace in which people can thrive, reach their full potential, and make a major contribution to the organizational performance.
The moral and business justification for supporting employees’ financial well-being at my workplace has never been stronger given Sri Lanka's soaring cost of living, which is putting an increasing number of employees at danger of experiencing in-work poverty. In these challenging times, Keells, a leading supermarket chain with a strong presence across Sri Lanka, has recognized that by delivering on all facets of employee well-being, including greater financial wellness assistance, it will likely have a positive impact on employee engagement, productivity levels and retention rates.
There is a common misperception in the corporate world that financial wellness is a 'nice-to-have' perk. In fact, having it is a necessity and a strategic imperative. Previously, it was believed that managing one’s finances was solely the responsibility of the individual. However, forward-thinking organizations view financial well-being of employees as a critical element of their Diversity, Equity and Inclusion initiatives, just as equal pay and fair hiring policies are.
How to foster a culture of financial wellness
Here are a few of my suggestions to demonstrate a commitment to financial wellness of employees.
1. Assessing employees’ need for financial support
A basic understanding of your employee base is a good place to start. Internal surveys and focus groups can provide useful information about your employees' financial well-being, such as whether and how personal financial matters contribute to stress and anxiety levels, as well as what they think of their compensation and perks. Such information gathtering creates the foundation for developing a strategic financial wellness framework. Data gathered from actual employee experiences can aid in identifying issues where employees fall short. Alternatively, it may help companies to identify inadequacies in their compensation and benefits programs and make changes to keep up with the industry.
2. Invest in financial wellness offerings
While working toward a comprehensive financial wellness program, organizations need to understand their employees’ financial needs and challenges; needs vary from employee to employee. Financial wellness offerings should ideally be tailored by first understanding each employee category within the organization and then determining what financial wellness means to them. Similarly, what appeals to one generation may not appeal to another. Zoomers and Millennials, for example, may be focused on long-term savings options, where as Boomers may prefer benefits related to healthcare and retirement. Giving people the opportunity to choose among benefit options ensures staff morale as it displays that thought was put into tailoring benefits rather than providing a general range of perks and assuming it fits all.
Financial wellness programs are now extending beyond retirement and insurance benefits. Supporting the family is also important because financial wellness revolves primarily around the family, not just the employee. Several financial wellness initiatives have been implemented at Keells over the years, including medical, educational, and entrepreneurial support for employees' families. When improving financial well-being benefits, economic conditions in a country should also be considered. Given the country's current financial crisis, a few multinational corporations in Sri Lanka have devised innovative ways to enhance financial wellness and retain employees, while reducing brain drain and financial stress. For example, certain organizations have decided to peg all salaries to the USD, resulting in a remuneration package that increases in value proportionally as the USD appreciates against the Sri Lankan Rupee.
Many employees of an organization are generally not financially literate. As such, workplace stress and anxiety brought on by financial illiteracy have a negative impact on employee engagement, productivity, and absenteeism. Hence, organizations need to pursue a more holistic approach to employee wellness by giving staff access to financial advice, counseling, and education on issues such as, debt management, financial planning, budgeting, and savings. This will help staff to make informed decisions about their finances.
As leaders, we need to have discussions with line managers and employees regarding the financial challenges both they and the company are facing. This will demonstrate our concern and empathy, as well as assist in eradicating the stigma attached to financial difficulties. Additionally, steps need to be taken to frequently communicate about financial wellness through a variety of channels, both to promote existing tools and resources for support and to foster open conversations about money worries.
3. Incorporating financial well-being in policies related to overall employee well-being
A financial well-being policy should ideally be an integral part of a comprehensive employee wellness strategy. Employers who show a commitment to improving their benefits package, assisting employees with their financial well-being, and ensuring appropriate assistance is provided to any employee experiencing financial difficulties can make a much-valued difference in their workforce. Even employers with limited resources can contribute by implementing a simple policy that informs their employees about where and how to get financial support.
A financial wellness strategy can power a company's success while also boosting employee engagement, productivity, and retention. Organizations can choose an approach that best suits both their goals and the needs of their staff by understanding employees’ individual financial worries.