How councils can use their influence to encourage healthier workplaces.
As we emerge from the biggest public health crisis in a generation, there is another, less tangible health crisis looming: mental health deterioration. For councils struggling with an increase in mental health needs during the pandemic, it won’t be surprising to hear that mental health featured in the World Economic Forum’s Global Risks Report for the first time in 2021, and was given greater focus for 2022.
Mental ill-health is an expensive business
In 2021, the Centre for Mental Health estimated that up to 10 million people may need mental health support in the aftermath of the pandemic. It put the cost at close to £120 billion per year once the expenses of health and social care, lost productivity and reduced quality of life are accounted for.
It is not only councils facing economic challenges – companies are struggling, too. As a result of poor mental health in the workplace, employers are losing billions of pounds because employees are less productive, off sick, or leaving, according to the Stevenson/Farmer review, Thriving at Work. Research by Deloitte suggests this costs UK businesses an average of £1,652 for every employee.
The opportunity for councils
Councils are not only providers of care, they are also investors. With around £51.5 billion in investments and £337.1 billion in pension funds collectively, local authorities have an opportunity to use their influence as stakeholders to improve the way businesses approach the health of their people.
Why take this opportunity? Because, irrespective of its cause, the workplace is a setting that can assist in the identification of mental illness and the facilitation of proper treatment. Because creating a positive environment for mental health costs less than failing to do so: the average return to employers for every £1 spent is £5 (Deloitte). And because, as investors, councils also stand to benefit from the positive action taken by businesses to address such issues.
CCLA’s mental health engagement work
It has not always been straightforward for investors to understand what companies are doing to safeguard the mental health of their employees. CCLA, investment manager for local authorities and charitable organisations, is working to change that.
This month, it will launch the CCLA Corporate Mental Health Benchmark, developed with the support of mental health charity Mind, Lord Dennis Stevenson, and the Principles for Responsible Investment.
The benchmark will provide investors with a tool for assessing how effective corporate leadership is in managing business risks associated with mental health. It will define expectations for workplace mental health and give investors an accessible way to understand and evaluate whether corporate practices meet these. Importantly, it will offer investors a level of insight not previously available and allow them to gain a clearer picture of the extent to which the investee company provides the right conditions for mental health at work to thrive.
Investment teams at councils will be able to view data on on the UK’s largest listed companies. Councils can encourage their investment managers to use it as a monitoring and engagement tool, asking questions of investee companies to encourage them to implement best practice. Or for councils that invest directly, it can help facilitate such conversations with direct holdings.
Ultimately, a healthier workforce makes a healthier community – and healthy, thriving communities make a better world for everyone.
- In August 2020, the LGA and Centre for Mental Health published Our Place, which details the work of nine councils that are pioneering best practice for preventing poor mental health in communities.
- Read more about CCLA’s work on mental health and the launch of its mental health benchmark.