How a Board should balance major strategic issues with staff retention and wellbeing’: An ICAEW podcast

GoodCorporation founder and director Leo Martin joined Peter van Veen, Director, Corporate Governance and Stewardship at the ICAEW and fellow panellists to discuss the role of the board in resolving ethical dilemmas where there is no clear solution. Their discussion explored the ways in which the board often needs to balance the strategic issues with workplace challenges that can arise.

In the ICAEW’s podcast, available on the link below, the panellists share their views on a fictional scenario of a food manufacturer in the throes of a merger. The discussion focuses on issues around staff retention and wellbeing in a cost-of-living crisis in the fictitious food and drink manufacturer Zingers.

Among the issues discussed is the significant increase in staff turnover, with a growing drop-out rate among trainees combined with a loss of senior, more experienced colleagues to higher paid jobs at other local employers. The staff retention issue is compounded by staff staying behind in the staff break rooms after the end of their shifts and a sharp rise in missing stock from the warehouse.

In the podcast, panellists explore the need to reappraise the current workforce management strategy, to understand why it isn’t working and what can be done within the context of a tough business environment, coupled with a challenging cost-of-living crisis. Presiding over a situation where staff are recruited and trained only to leave is a waste of the organisation’s time and resources. Managing this better requires a strategic re-think, introducing better management systems, retention incentives and also improved remuneration. Suggestions included a top-to-bottom look at pay, possible redistribution and a closer examination of the business model.

The board also needs to understand why behaviours such as pilfering and staying late are happening and how the organisation might help, either through advice to help staff cope or through practical steps such as giving staff food baskets to stop the pilfering that could lead to other, more serious issues.

Leo commented on some of the ethical issues at play and how these can have a wider impact on workplace culture. “Where one set of ethics goes wrong, and theft of stock is obviously an ethics issue, it can lead to other types of wrongdoing and signify that such misbehaviour might be acceptable or tolerated. But the issues raised do have to be looked at in the round. What is being pilfered?  If it is basic food items, then wages, working hours and the impact of the cost-of-living need to be considered. But from a purely ethics perspective, it’s about establishing a culture where people are encouraged and empowered to do the right thing. It is therefore imperative that steps are taken to address pilfering; if this becomes part of the culture it can lead to a change in attitudes towards more serious wrongdoing.”

Raising pay can be a challenge for many companies, not least when to do so may mean raising the cost of goods which in a harsh economic environment can be hard, if almost impossible to do. The moral obligation that society has a duty to ensure a right to lead a dignified life and who is responsible for this was also discussed.

Leo concluded: “This is a huge and complex topic, but from our work we can see that many companies in similar situations are moving towards codifying a set of values and behaviours they want to see. This should encompass all aspects of responsible behaviour, starting with how to treat employees to ensure dignity, and fairness. But it should also consider broader issues such as data privacy, environmental protection, fraud, the customer proposition and treating customers fairly. Indeed, all stakeholders all the way up to shareholders need to be considered to make sure that they benefit fairly and reasonably from any growth strategy. So, what the company should be doing is obviously thinking about all the different stakeholder groups and trying to codify behaviour in some sort of code of conduct, and that should be key to its cultural success.”

Click here to listen to the podcast