It is an interesting question posed last week by former Victorian premier Jeff Kennett. Leaders earn performance bonuses (usually) on profit and increases in shareholder wealth but Kennett argues that they should be partially linked to the mental wellbeing of their employees. In the same forum Business Council of Australia Chief Executive, Jennifer Westacott, called on Australian CEOs to rise to the challenge of improving mental health.
I agree with them both, that as leaders we must be more aware of the costs of a lack of mental wellbeing amongst staff and the broader benefits to business and the community if we get it right.
Firstly, to Kennett. In a speech to the Business Council of Australia’s Mentally Healthy Workplaces Discussion, he cited that close to $11 billion was lost in productivity each year because staff were not happy at work.
“Increasingly I am finding as chairman of BeyondBlue I am getting calls from very senior either board members or CEOs that one of their direct reports has hit a brick wall – in other words, the pressures on senior managers today seem to be increasing,”
Kennett also argued that making the mental health of employees one of the annual key performance indicators (KPI) of private-sector executives and government department heads would boost overall profit and staff productivity.
“I want to make sure that rather than members of the BCA and industry leaders just calling for tax cuts, they also put a priority on the mental health of their staff,”
“So I would have the board establish a KPI for the CEO, in terms of the conditions of the workforce, and I would have the CEO prepare the KPI for their direct reports.
“The issue of mental health isn’t just a workplace issue – but if we get it right in our workplaces there’ll be a ripple effect,” said Kennett.
Jennifer Westacott (rightly in my opinion) called on Australian CEOs to rise to the challenge of improving mental health.
“Mental health and safety is not the domain of the community or health sectors alone – business has a lot to contribute,”
“It’s important that psychological safety is taken as seriously as physical workplace safety and that businesses take practical steps to improve workplace wellbeing, organisational culture and workplace bullying.
“Our organisations recognise the need to work closely with each other to make sure we’re getting right in the initiatives workplaces are introducing. This is about productivity and growth, as well as health and wellbeing.”
Whilst I appreciate what Kennett (especially) and Westacott are proposing may be practically difficult to implement I firmly believe that where you link CEO bonuses to something, be it gender equality or mental wellbeing then you will see a change in behavior and results.