The war for talent has become the top business issue, and in response, many business leaders are reviewing their overall business model and employee value proposition.
The war for talent has become the top business issue, and in response, many business leaders are reviewing their overall business model and employee value proposition. Handling this challenge requires strong leadership from the executive team and the board. As custodians of the business brand, reputation, and organisational culture, the board is key to this process, and boards can be powerful ‘agents of change.’
In this podcast, Dr Sabine Dembkowski, Founder and Managing Partner of Better Boards, talks with Denis Woulfe MBE who has extensive experience serving on boards of Public and Private organisations.
Denis Woulfe is the Co-Chair on the board of ‘Leaders As Change Agents’ (LACA) and a Trustee at The Royal National Lifeboat Institute (RNLI), where he also serves as the Chair of the Audit and Risk Committee. He has served on numerous public and private boards and is a former governor at the University of the West of England. Until 2017, Denis was a Partner and Vice Chairman of Deloitte LLP, holding many leadership roles with the firm. His roles included serving as a board member and on the Audit and Risk Committee for eight years. In 2018 Denis was awarded an MBE for services to Women and Equality.’
Some of the key takeaways of the conversation include:
“Share best practices rather than just call for change.”
Denis highlights his keen interest in diversity and inclusion at work and its role in delivering fairness, opportunity, and competitive advantage, explaining how he believes these things go together. Previously Denis was a member of the UK government-sponsored Women’s Business Council board. Co-Chairing the ‘Leaders As Change Agents’ (LACA) board provides him a new opportunity to put to work what he believes in and act as an Agent of Change.
Denis explains that LACA noticed (particularly post-pandemic) that change has and is being accelerated. He and his colleagues felt the time had come for research and development of a framework as to how to make changes effectively and share best practices. This has been translated into LACA’s ‘Employer & Employee Guide’, a framework with eight principles.
“We’re not asking businesses to do anything they’re probably not already doing.”
Denis relates that because it is imperative, many businesses are currently already reviewing their business models and their employee value proposition, driven both by changes revealed by the pandemic and changes in market forces. He points out that the LACA’ Employer & Employee Guide’ framework provides the opportunity to improve diversity, inclusion, and fairness in the workplace during the review by considering the principles from LACA’s best practices research.
“We’re not putting forward a ‘one size fits all’ for all businesses.”
Denis notes that each business is different in geography, scale, industry, ownership structure, etc., so a ‘one size fits all’ would be impossible and inappropriate. He describes LACA’s eight foundational principles, which executive teams and boards may wish to consider when developing their plans. Those principles are drawn from best practice research.
The first principle is empowerment and choice. Denis explains this is about giving employees an appropriate voice and enabling them to feel connected to the business, which is key to their commitment and support. The second principle is to have diversity, equality, and inclusion as a foundation of the workplace culture, so everybody feels welcome and included. The third principle is growth and development, because everybody wishes to progress in their job and be given opportunities to develop their skills and experience. Denis explains that this provokes employers to look at all their workers and ask themselves whether they have an appropriate growth and development policy that touches everybody in the business. Fourth is commitment and engagement, gaining the views of employees and engaging them in certain decisions that affect them.
Denis describes participation in decisions as the fifth principle, as an important key to feeling involved. The sixth is work-life balance, which he explains will be different in different organisations. Still, businesses need to ensure that people’s work-life balance is respected, giving them time and the ability to recharge and be more effective at work. Seventh is fairness, and Denis promotes this as being for both sides. Employers must understand they need to be fair to their employees in terms of the employer-employee value proposition they offer. Still, employees also need to be fair to their employer and perform the tasks they have been engaged and paid to perform. So, Denis feels this means understanding and fairness on both sides. The final point he outlines is recognition and reward, not just in terms of pay, but in ensuring employees are recognised and rewarded for their contribution.
“The board’s role is to support the executive team and to provoke them to take these principles into account.”
Denis reiterates that the board’s role is usually is to oversee the business custodians of the business on behalf of the shareholders and the broader stakeholders. The executive team’s role is to run the business day to day and present policies, strategies, and investments to the board. Therefore, he believes that the board’s role is to support the executive team and provoke them to take these principles into account when presenting proposals. Hence, the board (if armed with relevant information and experience) can support the executive team and, if appropriate, challenge the executive team more effectively as they bring proposals to them.
“I’m not suggesting that the raw data is presented to the board, and a board is required to wade through it!”
Denis believes it is the job of the executive team to demonstrate they have assembled and consulted appropriate data in coming up with the proposals they submit to the board. Then the board’s role is to question what data has been included and then to judge whether or not that data is of sufficient quality and quantity to underpin the decisions the board is being asked to make. If the board feels that that isn’t the case, their role is to ask the executive team to look at that issue again.
“There’s only one opportunity in a business cycle to get this right.”
Denis believes that good quality, empirical data to support policies, investments, and practices is key. Some of that data will come from within the business around engagement with employees, both formal and informal, but he points out that some data comes from external sources. There is, for example, plenty of information on best practices, pay and condition surveys, what your competitors are doing and other businesses you measure themselves against. All this data is to help the board understand that the proposals being put forward by the executives are appropriate to the business, but also sit well within the broader commercial and societal comparisons to which the board also have a duty.
“Look at these issues carefully, not only from the fairness and inclusivity point of view but also as a source of competitive advantage.”
Denis notes that the expectations of external stakeholders such as governments, regulators and shareholders have accelerated due to the pandemic. However, in many areas, it was well advanced before that. Governments and regulators, particularly in the listed environment and regulated industries, are taking more interest in workplace culture and expecting organisations they regulate to take these principles into account to try and deliver a fair and inclusive workplace culture. He observes that employees and their groups also have higher expectations that their employer will deliver a fair employee value proposition.
He describes that employers who fail to address this will find themselves at a competitive disadvantage for key people who are increasingly willing to move to employers they believe will give them a better offering. Denis only sees these issues increasing and accelerating. He encourages businesses to look at these issues carefully, from the fairness and inclusivity point of view and as a source of competitive advantage.
The three top takeaways from our conversation are:
- It has never been more important to try and address these challenges, and this is very firmly a leadership issue that requires a strong and consistent leadership response.
- Getting this right can be a crucial source of competitive advantage for individual businesses, and it goes to the heart of the strategy and culture of the business. The board has a pivotal role in driving and overseeing this change.
- There is an opportunity for business leaders to influence their broader networks by supporting these principles and encouraging others to do so by being active change agents themselves.
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