1、Preparing for the future by aligning workforce risk strategies with employee needsUnlocking opportunities to manage workforce riskTo manage and address people risks effectively,HR teams and risk managers need to work closely together,and risk management strategies must be aligned with employees need

2、s to ensure a resilient business.However,as set out following,theres plenty of evidence that employers are missing the mark when it comes to managing people risks effectively.If these failures are left unaddressed,they can have negative repercussions for organizations of all types.By combining the r

3、esults of our Health on Demand 2023 and our People Risk 2022 research reports,weve identified four key areas where businesses must focus their attention:talent attraction and retention,crisis management,mental health,and climate change.Unlocking opportunities to manage workforce riskPreparing for th

4、e future by aligning workforce risk management strategies with employees wants and needs.Figure 1:Aligning workforce risk management strategies with employees wants and needsWe learned that managing people-related risks depends heavily on close collaboration between HR and risk managers.Herv Balzano

5、,President,Health&Benefits at Mercer and Global Leader at MMB2Unlocking opportunities to manage workforce risk.Preparing for the future by aligning workforce risk strategies with employee needs.People riskTalent attraction and retentionClimate changeCrisis managementMental health3Unlocking opportuni

6、ties to manage workforce risk.Preparing for the future by aligning workforce risk strategies with employee needs.People,purpose and profit are the keys to organizational success.This means risk management cant be focused solely on physical assets.As organizations reset for relevance in this fast-cha

7、nging world of struggling health systems,violent conflict and misinformation,they must focus not only on the needs of investors and customers,but also on the needs of their employees.When determining what makes the most sense for their organizations in the long term,leaders should consider people an

8、d purpose alongside profit to ensure the resilience of their organizations,now and into the future.To be resilient and react to crises with agility,organizations need strong foundational business practices.They should also prioritize the preservation of trust among their employees and other stakehol

9、ders through strong communications backed by tangible action.PeopleStrong foundationHR and Risk must work together to tackle people risksPurposeValued trustProfitKeys to organizational successResilience and agility enablersEnterprise risk managementFigure 2:Risk management is evolving to look at peo

10、ple,purpose and profitPeople,purpose,and profit are the keys to organizational success reinforcing risk management beyond physical assets to people-centric values is crucial.Dan Aronson,US Casualty Practice Leader at MarshUnlocking opportunities to manage workforce risk.Preparing for the future by a

11、ligning workforce risk strategies with employee needs.Talent attraction and retentionWhen we speak to business leaders,risk managers and heads of HR about what keeps them up at night,the war for talent is a consistent theme.Workforce attrition,in particular,can lead to a loss of valuable knowledge a

12、nd expertise.And the financial impact of attrition shouldnt be overlooked either each time an organization loses an employee,it costs the business money.To mitigate these risks and attract new employees,its crucial to implement robust retention strategies,including attractive employee benefits progr

13、ams.Yet,according to our People Risk 2022 report,a clearly articulated and well-understood EVP can mean the difference between winning and losing in the war for skills.Meanwhile,despite the fact that benefits play an increasingly critical role in the attraction,engagement and retention of key talent

14、,just 59%of employees say the benefits they receive meet their needs.For instance,our Health on Demand research shows that 72%of employees whose employers provide them with 10 or more core benefits say theyre less likely to move to another company because of the benefits they receive.By comparison,j

15、ust 43%of people whose employers provide only one to four benefits say the level of benefits they receive makes them less likely to move to another employer.Figure 3:The employee value proposition encompasses purpose,career,well-being and rewards4Unlocking opportunities to manage workforce risk.Prep

16、aring for the future by aligning workforce risk strategies with employee needs.43%of organizations think their employee value propositions(EVPs)need improvement or dont know how effective their EVPs are.This is a significant wake-up callEquitableCompensationPurposeCareersWell-beingBenefitsEnrichingF

17、ulfillingFlexibilityUnlocking opportunities to manage workforce risk.Preparing for the future by aligning workforce risk strategies with employee needs.Figure 4:The level of health and well-being benefits received from my employer makes me less likely to move elsewhereWhile its clear that the more b

18、enefits employees receive,the less likely they are to leave their employers,the fundamentals matter most.Providing foundational benefits,such as life and medical coverage,ensures that peoples basic needs are met.Such benefits are the keystone to a successful EVP.Without them,you wont be able to mana

19、ge your people risk.Source:Mercer Marsh Benefits.Health on Demand 2023.72%62%43%32%0 benefits1-4 benefits5-9 benefits10+benefitsGet to know your employees.Apply a segmentation approach,understanding how your current benefits program supports different types of employees.For example,consider employee

20、s life stages and health concerns,and think about the responsibilities shouldered by different groups,such as women.Align your benefits offering with your companys purpose,and think about how to successfully communicate your EVP.Employers who offer benefits that meet the needs of individuals have a

21、significant advantage.Steps you can take:12Takeaway for employers5Unlocking opportunities to manage workforce risk.Preparing for the future by aligning workforce risk strategies with employee needs.Lack of natural resourcesChronic health conditionsGeoeconomic confrontationSocial cohesion erosionClim

22、ate changeDigital inequityBiodiversity lossInfectious disease Cost of living Polycrisis concerns for employee health and benefit managersMisinformationCrisis managementThe most pressing people risks in 2022 included cybersecurity and data privacy(#1),catastrophic personal life events(#3)and pandemic

23、s(#5).These employee risks,alongside the multiple,concurrent crises(“polycrises”)that many employers now face,can overwhelm organizations.Together,they show the importance of crisis management for all businesses.Figure 5:Concurrent crises impacting businesses and their workforces6Unlocking opportuni

24、ties to manage workforce risk.Preparing for the future by aligning workforce risk strategies with employee needs.Unlocking opportunities to manage workforce risk.Preparing for the future by aligning workforce risk strategies with employee needs.This marries up with how employees are feeling.When we

25、asked workers about their states of mind,they said they were concerned about a myriad of risks,including economic conditions,health crises and pandemics,and even violent crime.The good news is that 67%of employees think their employers would support them in an emergency or time of need.Encouragingly

26、,we found that“people safety”was the most cited driver of business planning discussions for CEOs and CFOs in 2023.1When employees are let down by their employers in times of crisis,they vote with their feet,and a firms wider reputation may be tarnished.Organizations must be able to retain the trust

27、of their employees by putting measures in place to support people through catastrophic personal life events.1 Mercer.Beat the Crisis:How Executives Are Responding to Economic Shocks and Talent Shortages,2023.To ensure business continuity,HR must collaborate with risk management colleagues when plann

28、ing for the“what ifs,”including the impact of any challenges on employees and their personal lives.Scenario planning can help you anticipate and manage polycrises and will help ensure that concurrent risks have fewer unexpected consequences for both the business and the workforce.Be creative in how

29、you provide support to employees when they face the“moments that matter,”and consider ways to protect employees when theyre not at work.For example,think about the best ways to let employees know about the help and resources available to them in a crisis situation(such as digital health advice,emerg

30、ency savings accounts and financial support).127Takeaway for employersUnlocking opportunities to manage workforce risk.Preparing for the future by aligning workforce risk strategies with employee needs.Figure 6:Crisis-management planningCrisis mitigation planAssess Security,vulnerability,threat asse

31、ssments Threat policies and procedures Employee on-and off-boarding policies and procedures Mental health and EAP program adequacyPrepare Emergency response plan Drills and exercises Crisis management communications Awareness,trainings,briefings:employees,managersRespond In the moment emergency resp

32、onse,crisis management and crisis communications Mental health resources and trauma supportRecover Post incident analysis Update plans and procedures Continued mental health support Continuity of operationsAssess Security,vulnerability and threat assessments Threat policies and procedures Employee o

33、n-and off-boarding policies and procedures Mental health and EAP program adequacyRecover Post-incident analysis Updated plans and procedures Continued mental health support Continuity of operationsPrepare Emergency response plan Drills and exercises Crisis management communications Awareness,trainin

34、gs and briefings for employees and managersRespond In-the-moment emergency response,crisis management and crisis communications Mental health resources and trauma support9Unlocking opportunities to manage workforce risk.Preparing for the future by aligning workforce risk strategies with employee nee

35、ds.Mental health and workforce exhaustion9Unlocking opportunities to manage workforce risk.2Preparing for the future by aligning workforce risk strategies with employee needs.Our Health on Demand research found that 47%of employees are stressed in their everyday lives.Following the pandemic,higher n

36、umbers of people are now exhibiting signs of depression and anxiety.2 Concerns about the current economic downturns,war and violent crime create additional stress and can cause mental health and well-being to deteriorate further.High levels of stress and anxiety can also have a negative impact on ho

37、w employees assess and avoid potential hazards in the workplace.If a persons ability to recognize workplace hazards is lowered,or if theyre so distracted that they cant follow safe work procedures,accidents can occur.Worryingly,mental health was flagged as a blind spot for employers in our People Ri

38、sk research,falling in the rankings to#20 out of 25 risks.In addition to providing strong mental health supports and benefits,organizations must ensure that theyre fostering a psychologically safe workplace.Examples of potential burnout factors include work pressures,poor leadership and a toxic work

39、 culture.2 World Health Organization.“COVID-19 Pandemic Triggers 25%Increase in Prevalence of Anxiety and Depression Worldwide,”March 2,2022,available at https:/www.who.int/news/item/02-03-2022-covid-19-pandemic-triggers-25-increase-in-prevalence-of-anxiety-and-depression-worldwide.Figure 7:Employee

40、s cite work pressures,poor leadership and toxic culture as their top potential causes of burnout16%23%24%28%31%35%37%39%54%Work pressuresPoor leadershipToxic cultureJob securityLack of flexibility in schedule/locationDangerous work environmentLack of connection with colleaguesTechnological changeLac

41、k of purposePotential burnout factorsSource:Mercer Marsh Benefits.Health on Demand 2023.Its important that leaders,risk managers and HR teams highlight and address practices within their organizations that can lead to poor mental health.Unlocking opportunities to manage workforce risk.Preparing for

42、the future by aligning workforce risk strategies with employee needs.Gaps in mental health programs are well understood(see MMBs Health Trends 2023 research).A holistic approach to mental health supports should encompass:Training for colleagues and managers Self-care Early intervention Adequate trea

43、tment Care for specialized needs Crisis supportFill any gaps in the mental health benefits coverage you provide for your entire employee population.Dont forget preventive healthcare supports and virtual care.Recognize that how work is designed and managed is just as important for an emotionally heal

44、thy workforce.Consider interviewing different levels of leadership,and tap into employee networks to understand the organizational stressors your people face.Use the results of your research to devise a plan to address any problems.Train frontline supervisors to recognize the signs and symptoms of s

45、tress,and make sure they understand the company procedures to follow when stress is identified.Highlight the general procedures that should be used to ensure all work practices are safe.12310Takeaway for employers11Unlocking opportunities to manage workforce risk.Preparing for the future by aligning

46、 workforce risk strategies with employee needs.Fostering apsychologicallysafe workplaceEthics Define team values and behaviors Be firm with negative behaviors Boundaries Set reasonable expectations Be patientAction Trust people to work independently Admit mistakes Innovation Allow people to tap into

47、 their strengths Learn collectively from mistakes Belonging Be inclusive in idea-sharing and decision-making Show vulnerability Allow others to be themselvesFigure 8:Fostering a psychologically safe workplaceUnlocking opportunities to manage workforce risk.Preparing for the future by aligning workfo

48、rce risk strategies with employee needs.Climate change and sustainability12Unlocking opportunities to manage workforce risk.Preparing for the future by aligning workforce risk strategies with employee needs.This years Global Risks Report identified the second-highest short-term global risk as“natura

49、l disasters and extreme weather.”This was borne out in our People Risk research,which found that environment was a top-10 people risk globally.The environment is also critically important to the workforce.Environmental factors are only a part of environmental,social and governance(ESG),and it is imp

50、ortant to also focus on the social aspects.Consequently,organizations are feeling pressure from customers,investors,employees and regulators to ensure that profit doesnt come at the expense of society or the planet,along with pressure to give back to communities.However,despite these strong drivers

51、for managing environmental risks,just 41%of HR and risk managers say they have clear policies to reduce their organizations carbon footprints and to address the impact they have on climate change.Organizations should recognize that addressing ESG issues holistically means focusing on the“S”in ESG.On

52、e way to do this is to look at healthcare and financial wellness benefits through an ESG lens.This type of benefit is still largely targeted at the top of the organizational pyramid,yet certain groups,such as women and low-paid or part-time employees,are less likely to be confident that they can aff

53、ord the healthcare they need.Extending coverage to these groups to address their unique needs can bridge this inequality.are extremely or very concerned about climate events having an impact on them or their families42%of employees want their employers to support environmental sustainability through

54、 internal and external statements and actions66%would find it useful to receive a benefit that helps them live a more environmentally friendly lifestyle43%Unlocking opportunities to manage workforce risk.Preparing for the future by aligning workforce risk strategies with employee needs.Companies hav

55、e a clear opportunity to make themselves more attractive to potential and current employees and differentiate themselves by demonstrating a real commitment to social issues and sustainability.Ensure that the external voice you direct to investors and the market mirrors how youre supporting your empl

56、oyees.Explore ways to go beyond standard market practice and offer more relevant benefits to the most vulnerable groups within your workplace.Use authentic communications to take a stand on the issues that align with your company purpose and values and where you can have an impact.Consider how your

57、organization can implement benefits aligned with those values.For example,look at how the benefits you offer can support the environment.1324Figure 9:Health equity starts with affordability,but some employees are less confident they can afford the healthcare they needPercent of employees who are not

58、 confident they can afford healthcare.Median income and aboveMaleFull timeBelow medianFemalePart timeif household income is.15%18%20%31%26%29%if work status is.if gender is.Source:Mercer Marsh Benefits.Health on Demand 2023.13Takeaway for employers14Unlocking opportunities to manage workforce risk.P

59、reparing for the future by aligning workforce risk strategies with employee needs.Modernize the benefits you provide Promote and offer employee programs to support net zero goals and climate adaptation Redesign car,cycling and transportation policies Offer sustainable investment options under saving

60、s plans Prepare employees to mitigate against heat,flood and other climate eventsGet involved internally and externally to advance change Create cross-functional risk evaluations and frameworks Partner to create healthy and resilient communities Consider efforts to help mitigate against biodiversity

61、 lossAdapt how people can access and use programs Use digital health to provide a vital connection during future crises and reduce unnecessary commuting Use digital vs paper administration and communication Participate in audits of supply chains for appropriate standardsFigure 10:Benefits programs c

62、an support the environment tooEvaluate community,organizational and supply chain vulnerability and resilienceUnlocking opportunities to manage workforce risk.Preparing for the future by aligning workforce risk strategies with employee needs.15ConclusionThe COVID-19 pandemic,the war in Ukraine,climat

63、e change and other world issues are changing how organizations ensure the safety of their workforces and strive for business resilience.Its clear that greater collaboration between HR and risk managers and the diversity of thinking that comes with it leads to better risk management.HR and risk manag

64、ement teams must work together using an enterprise risk management approach(see Figure 11)built around identifying,assessing,managing and monitoring risk.Applying this framework to people risks enhances agility and resilience.This methodology has stood the test of time and can be applied to all the

65、key risks highlighted by our research.In fact,a risk management approach to designing,delivering and financing employee benefits can help mitigate every people risk outlined above.To learn more,download our Health on Demand and People Risk reports now.Moving forward Adopting a risk management framew

66、orkEnterprise risk management approachRisk identificationQualitative analysis Quantitative analysisTreat,terminate,transfer or tolerateKey risk indicatorsKey control indicatorsMonitor and reviewAnalyze and assessIdentifyRespond and controlFigure 11:Applying an enterprise risk management approach to

67、people risks enhances agility and resiliencePeople RiskResetting priorities to manage risks for workforce and business resilience 2023 Marsh McLennan.All right reserved.For further information,please contact your local Mercer Marsh Benefits office.Marsh McLennan businesses provide a range of solutio

68、ns to help you build a resilient workforce and business,including:Benefits strategy,broking,design,financing and delivery Health and well-being,including mental health and longevity Global benefits Business continuity Enterprise risk management Business resiliency and crisis management Cybersecurity

69、 risk management Environmental,social and governance(ESG)Diversity,equity and inclusion Workforce communications Flexible working and work design Employee experience,listening and total rewards Living wage RetirementAbout Mercer Marsh Benefits Mercer Marsh Benefits provides clients with one source f

70、or managing the costs,people risks,and complexities of employee benefits.The network is a combination of Mercer and Marsh experts working across 130 countries to develop local solutions drawn from global expertise.Mercer and Marsh are businesses of Marsh McLennan(NYSE:MMC),the worlds leading profess

71、ional services firm in the areas of risk,strategy and people,with more than 85,000 colleagues and annual revenue of over$20 billion.Through its market-leading businesses including Guy Carpenter and Oliver Wyman,Marsh McLennan helps clients navigate an increasingly dynamic and complex environment.For more information,visit ,or follow us on LinkedIn and Twitter.