CCLA, the public sector and charities investment manager, is launching a benchmark for investors to measure the management of employee mental wellbeing in large companies.
The CCLA Mental Health Benchmark will assess factors such as whether a company promotes mental health awareness among employees and contractors or considers related safeguarding in job design, and whether managers are trained to provide positive mental health support in the workplace.
It will incorporate a scoring system allowing comparisons between companies.
The benchmark is being developed in partnership with Chronos Sustainability, a specialist advisory company with expertise in designing and delivering sustainability-related benchmarks.
CCLA will also be advised by a dedicated panel of corporate representatives, mental health experts and employee wellbeing practitioners.
The benchmark builds on an engagement programme that CCLA began in early 2019, which identified only limited attempts by companies to address poor mental health in the workplace in contrast to their approach to physical health and safety.
The findings showed that around 15% of people at work in the UK have symptoms of an existing mental health condition, with a cost to employers – through absenteeism and poor performance – of up to £45bn per year.
COVID-19 has exacerbated the situation. According to the Office for National Statistics, almost one in five adults in the UK was likely to be experiencing some form of depression in June 2020, double the one-in-10 figure from before the pandemic.
CCLA said it believes that supporting and promoting strong mental health effectively will increase companies’ ability to retain skilled employees and therefore their own reputation and sustainability, strengthening the businesses themselves.
Amy Browne, stewardship lead at CCLA, said: “The benchmark will provide investors with an objective way of assessing companies on their mental health record. This will allow them to play a constructive role through engagement, while making clear which companies are harnessing the opportunities, and avoiding the related risks.”
Shortly after the start of the UK’s first lockdown, CCLA had brought together a coalition of investors managing £2.2trn (€2.4trn) of assets – including the Church of England Pensions Board, Norwegian Church Endowment Fund, Brunel Pension Partnership and Aviva – and written on their behalf to the chief executive officers of every FTSE100 company.
The letter urged the CEOs to take steps to protect their employees’ mental health during the pandemic.
CCLA plans to launch the benchmark early next year, with the 20 biggest FTSE100 companies. The intention then is to roll it out globally, to include MSCI World companies, by the end of 2021.
“The pandemic should not be an excuse for apathy”
Amy Browne, stewardship lead at CCLA
CCLA believes it will be the first mental health benchmark covering companies worldwide.
Browne said: “There are mental health indices available elsewhere, but because they are voluntary, the worst performers are neither captured nor held to account.”
The CCLA benchmark will rank companies regardless of whether they choose to disclose any information.
Browne told IPE: “If there was a moral obligation to pursue this agenda before, the second lockdown has vastly increased the urgency of this work. There is a real need to share best practice, to improve reporting, and to push more forcefully for change.”
She added: “The pandemic should not be an excuse for apathy. In our experience, good companies are introducing – and making obligatory – mental health training for all managers, relaxing their performance and appraisal targets, and monitoring the use of their employee assistance programmes (EAP) to ensure that the message is being heard.”
But she warned: “There is, however, little commonality in approach, a lack of monitoring and a shortage of overt commitment by senior leaders.”
CCLA will start a six-week online public consultation in early December to focus on the key questions the framework should address, including definitions of mental health, scope of corporate responsibilities, and potential metrics and measures.
It expects to pilot the benchmark in March 2021 and release a public project report in April 2021.