How Using ESG Investing Policies Can Boost Your Team’s Health

by / ⠀Career Advice / July 9, 2021

“Conscious capitalism” is having a moment right now. Consequently, team health and wellness is being prioritized now more than ever.

According to Morningstar’s Sustainable Funds U.S. Landscape Report for 2020, investment funds that follow environmental, social, and governance (ESG) principles saw inflows totaling $51.1 billion during the pandemic year. That’s the fifth consecutive annual record and more than double the total from 2019.

Companies that follow ESG principles clearly stand to benefit from investors’ bullishness. Additionally, in many industries, firms that advertise their commitment to ESG have an easier time attracting and retaining clients and employees who share that commitment.

In keeping with ESG’s “triple bottom line” North Star, the profit motive isn’t the only reason for entrepreneurs and business leaders to incorporate ESG guidelines into their firms’ policies and practices. Doing so is also good for the planet and for the people who inhabit it.

ESG Principles Are Good for Your Team’s Health (And Good for Business)

Running all of your business practices through an ESG lens is beneficial for one very important group of people: your employees. If they’re like most American workers, your employees aren’t entirely sure that you’re doing enough to ensure they’re performing at peak potential. Many are increasingly cognizant of work-related stressors that can cause them to burn out along the way.

So how can employers utilize ESG principles to improve their team’s mental health and wellbeing? And why should they? Let’s take a closer look.

Employee Wellness Programs Get Noticeable Results

According to behavioral and mental health provider Pathways at Work, the cumulative effect of offering mental health opportunities for employees can hardly be overstated. Employee wellness programs that offer a confidential mental health component help create a noticeably better work culture. A healthier and safer work atmosphere, in turn, increases employee productivity.

Your company doesn’t need to wait to adopt formal ESG guidelines to roll out an employee wellness program. Many non-ESG organizations have instituted employee wellness programs for no other reason than the results speak for themselves. That said, a formal wellness program is the cornerstone of any ESG implementation’s focus on people.

Setting up a program isn’t as difficult as it sounds. There are customizable programs like Pathways at Work that your company can utilize, consisting of live and on-demand workshops and interactive discussion groups which can help employees manage common behavioral health issues, like anxiety and stress.

ESG’s Holistic Approach Is Perfect for Workplace Wellness Initiatives

Organizations that adhere to ESG guidelines tend to blur the lines between the professional and the personal. But this is a good thing! Implemented correctly, a successful wellness initiative gives employees what they need to remain healthy and happy at home and in the workplace.

Nowhere are the benefits of this blurring clearer than in the workplace wellness and team-building initiatives that are essential to realizing ESG’s “people” directive.

For example, wellness services such as confidential in-home counseling and mental health assessments — which many employees are reluctant or too busy to pursue without support — give employees and their leaders the confidence to meet any challenge. 

Engaged Teams Are More Visible in the Markets They Serve

At the intersection of the “people” and “planet” lenses lives “community,” one of the core five stakeholders in the ESG framework. Companies that find ways to serve their communities set up a classic win-win scenario for themselves and their teams.

There are many team-building initiatives such as Habitat for Humanity home-building or roadside litter cleanup days. These initiatives increase the presence of employees and businesses in the wider community. This, in turn, makes them more visible to the markets they hope to reach. They also bring employees closer to one another. Additionally, they promise a change of pace with clear benefits for mental health and wellbeing.

Well-Adjusted Employees Reflect Well on Their Employers

Employers look good when their employees do well. Clients and investors take notice. You can do the math here. If the profit motive sounds too self-interested to have a place in the ESG framework, remember that the closely related triple bottom line encompasses people, planet, and profit. Healthy employees are better able to build healthy companies.

It’s not an either-or situation, or an either-either-or situation, in this case. ESG practices emphasize an all-of-the-above scenario. These practices are ones that create a powerful value proposition that’s sure to benefit your team’s health, and the company, in the long run. The trick is to not expect results overnight.

Do You Really Know What Your Employees Are Going Through?

It’s often said that we’re the sum of our experiences. There is another way of looking at it, though. We could also say that it’s difficult for us to empathize with those whose own experiences differ significantly from ours.

Take a look around your workplace. Unless all of your employees are members of your immediate family, it’s all but certain that individual members of your teams bring different life experiences and perspectives to work every day. It will take some effort to bring to the surface whatever may be percolating underneath an individual employee’s drop in productivity.

This is normal. Making this kind of investment in one person makes your team’s health stronger. And it should serve as a reminder that even if you personally don’t see the need to institute ESG principles with an eye toward improving employee wellbeing, your employees might very much like that to happen. Both you and your organization will grow stronger as a result.

Implementing ESG: A Big Change Worth Making

Retooling any organization to incorporate ESG principles is, admittedly, a big undertaking. It demands a careful and oftentimes critical look at every aspect of the business, every formal process, every unwritten assumption. It can be a challenging and sometimes even painful task.

It’s only natural that the idea of making a change to incorporate ESG principles meets with resistance from many entrepreneurs and business leaders. Why fix what isn’t broken, after all?

Because, as good as business might be right now, it can get better. Implementing things like a wellness program or volunteering in the community can be a big project, not to mention time-consuming. But, it’s one that’s likely to produce big results over time. Show your employees you want to invest in ESG through your actions. It’s a change worth making, one that could pay dividends for years or decades to come. Your team will thank you — and reward you — sooner than that, though.

About The Author

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Editor in Chief of Under30CEO. I have a passion for helping educate the next generation of leaders.

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