Employee engagement is a key issue for business these days. The need to do more with less requires a motivated, productive workforce – something that may not be easy to sustain when there is so much negativity and pressure on people from within and outside the workplace.
The MacLeod report in the UK comments that ‘as well as performance and productivity, employee engagement impacts positively on levels of absenteeism, on retention, on levels of innovation, on customer service, on positive outcomes in public services and on staff advocacy of their organisations’. Even in turbulent economic times engagement works. Towers Watson found that companies with high and sustainable engagement levels had an average 1-year operating margin that was close to 3 times higher than those with lower engagement.
So given that employee engagement is good for business, how do you go about it?
Key drivers of employee engagement are leadership and strategic direction, good management, employee voice and organisational integrity. These are probably self-evident. What may be less well known is the finding in a number of research studies1 2 that a company’s corporate responsibility strategy, if it is well implemented and communicated, can play as big a part in employee engagement as job satisfaction.
A good example is RSA in the UK. In 2012, RSA won the Chartered Institute of Personnel and Development’s (CIPD) Employee engagement award and was also the overall winner. ‘Five years ago RSA was experiencing low morale, generating disappointing financial returns, managing board takeovers and struggling to recruit the right talent’. However, by focusing on employee engagement, they turned the situation around and showed the positive effect of team engagement on customer satisfaction and new business growth. The judges commented that RSA’s ‘leading through change’ training programme, provided to all of its 1,100 managers, and its employees’ involvement in 40,000 hours of volunteering, raising £750,000 for good causes “particularly stood out”.
Supporting employees to cope with change and facilitating them to volunteer with community organisations are just two ways to help improve employee engagement. While the actions of organisations towards individual employees are important drivers of engagement, the ways employers treat other stakeholders also influence employee engagement. A study3 of 4712 employees in financial services found that an employee’s engagement depended in part on perceptions of whether the organisation treats other employees fairly.
Other research demonstrated that employee perceptions of the socially responsible activities of their employers towards external stakeholders (e.g., customers, taxpayers, charities and the environment) are also important determinants of engagement. When employees perceive their employer is actively involved in the community and the environment, they respond with greater commitment to the organisation, which can in turn lead to increases in organisational performance.
Times are tough and a company needs every tool in its toolbag to be successful. Corporate responsibility and sustainability can play an important part in a company’s employee engagement strategy.
Article written by Business in the Community Senior CR Consultant Elaine Stephen firstname.lastname@example.org
Resources:1 Tucker, “How Corporate Social Responsibility influences Organizational Commitment”, Journal of Business Ethics (2009) 2 Kim,Lee,Lee, Kim, ‘Corporate Social Responsibility and Employee-Company Identification, Journal of Business Ethics (2010) 3 Brammer, S., A. Millington and B. Rayton (2007). “The contribution of corporate social responsibility to organizational commitment.” International Journal of Human Resource Management 18(10): 1701-1719