How to Boost DE&I With the Right Benefits
Life insurance and retirement contributions not resonating with employees? Here’s how to support retention, engagement and diversity with a strong benefits package.
Diversity, equity and inclusion (DE&I) is now a core part of business strategy for many organisations. DE&I has evolved in leaps and bounds over the past few decades. In particular, the last two years have seen companies take a more data-driven approach to their DE&I policies, which has included looking at benefits and compensation as well as manager training and hiring strategies.
But while some companies have become leaders in DE&I, others are still catching up. To better understand the extent to which DE&I practices are informing employee benefits design, culture and work environments globally, Aon produced its 2022 Global Diversity Equity and Inclusion Survey Report. The company surveyed more than 1,200 rewards, benefits and DE&I leaders across 55 countries and discovered that, overall, DE&I is of interest to most businesses.
74 percent of respondents say they have developed a tailored DE&I policy, and 84 percent identify colleagues responsible for leading DE&I initiatives. Support from senior leadership was also strong (94 percent); however, when it came to employee benefits, the levels of support varied across companies and regions, with some having a notably broader scope of coverage than others.
Offering diverse and inclusive benefits can boost retention and engagement
When it comes to fostering diversity, equity and inclusion, employee benefits are one of the most useful and effective tools a company can use. According to Alan Oates, Aon’s head of advisory and specialty, employee benefits have “never been more important in the workplace”, and that’s precisely because of the role they can play in supporting diversity.
“Twenty years ago, I think benefits were perhaps seen as more of a hygiene factor, and companies were differentiating themselves on compensation,” Oates says. “However, benefits have taken on a completely different role now. It’s become an important topic for global multinational organisations, as it’s key to how they attract and retain their talent.”
Oates points out that if a benefit can help attract or retain someone who might ordinarily have moved on, then you’ve directly contributed to the diversity pool in your organisation. It will also help strengthen your EVP, which you can market directly to potential and existing staff.
However, the current problem with most benefits is that they’re paid out on ‘dread events’. An employer paying out four times your salary upon your death is hardly a headline-grabbing story, and a retirement contribution won’t resonate very strongly with younger employees. This can reduce the marketing impact of these benefits and won’t deliver the positive, human message you need to attract the best talent.
“Diverse benefits can make a big difference to employees’ lives. Take fertility treatment, for example. These programmes won’t appeal to everyone, but for employees who need support to build a family and don’t have the resources, it can be life changing”, Oates explains. “It’s easy to imagine why employees receiving that kind of benefit might feel a sense of connection and belonging to the organisation and want to stay longer term. By tailoring benefits to meet diverse needs, companies can build a more resilient workforce; they are helping employees while also making it hard for competitors to poach key talent.”
“DE&I-driven benefits can also provide support with emotional wellbeing, which is the top employee wellbeing issue in Asia Pacific Aon’s Global Wellbeing Survey Report. Introducing employees to preventative support is a high growth area. Many of our leading clients have pushed to provide benefits for transgender employees, and while they see very few claims in that area, the support those employees receive changes their lives.”
But while companies worldwide have been taking great strides in this space, the 2022 Global Diversity, Equity and Inclusion Survey report shows that there are still some gaps to fill. Oates says cost is often the biggest barrier to introducing a broader range of benefits, and some specific areas of wellbeing are still underserved.
“Financial wellbeing, for example, is an area that links with every other area of wellbeing,” Oates says. “For example, we know that employees who struggle with their finances are more likely to experience poor mental health, and people with mental health issues are also more likely to struggle with their finances1”, he adds.
“If you’re not doing well financially, then you’re likely under quite a lot of emotional stress, and it may affect your physical health and social relationships. These things are all linked, and so we spend a lot of time with organisations trying to make financial wellbeing a cornerstone of how they support employees.”
Where do organisations start?
If your company is in the beginning stages of its DE&I benefits journey, support is available.
Inevitably, every company will have different needs, depending on their sector, their size and the type of support they already have in place. Oates says the starting point is always to take stock of where you are today, get a sense of the diversity that already exists in your organisation, and then speak to senior leadership about where your business strategy is heading. You can then look at how diverse your workforce needs to be to maximise the skills you need.
“You can then ask yourself why the people you need are not joining your firm, or why they are leaving – and it’s unlikely to be because of a dollar in their base salary,” Oates says.
“You should absolutely do work around your pay, but some groups of people may still feel they’re not getting the kind of support that they need to really be successful. You need to speak to them and understand what their needs are, and that’s where our survey can really be helpful. You can look at organisations who have already had those conversations and gone through that analysis and think about what you want to build in the future.”
Oates notes that one common mistake companies make is simply increasing benefits in line with the median, without considering whether that makes sense for them. This is where outside support and strong data insights can become very valuable, as working with a partner will help you figure out where your gaps are and how to cover them in the most cost-effective way.
1 The C-suite and workplace wellness | Deloitte Insights
