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How are Blue Monday and ESG related?

By: Annalise Toberman


In the UK, the third Monday of January has been designated as Blue Monday.

With Christmas and New Year festivities forgotten, work pressures renewed, the Beast from the East threatening to return and vitamin D levels running low, there are both physiological and psychological reasons why today is supposedly the most depressing day of the year.

The dialogue around mental health issues has improved dramatically in recent decades, but action to tackle them through public health measures or company policies is still lacking. And as with all public health predicaments, there is an associated financial cost. The City Mental Health Alliance has estimated that mental illness is costing City employers alone £100m a year as long hours and job insecurity cause undue stress. This is based on sufferers being absent from work more often and less productive when they are present.

ESG analysis in investing often includes health and wellbeing factors, but these tend to focus on physical rather than mental health. It is easier to assess the health and safety measures implemented along a supply chain than it is to ascertain whether a) members of staff are chronically stressed or unhappy and b) to what degree the company is contributing to or alleviating their suffering.

Julia Dreblow, founder of sriServices and Fund EcoMarket, suggests that while fund managers have not been conducting explicitly happiness-focused research, “Mental health is increasingly rising up the corporate agenda, and therefore the investment agenda.”

She adds: “Motivations will vary, but at its most basic level employees who are happy in their jobs are likely to be more productive and take less time off through ill health. Companies with ‘happier’ employees will also benefit from better staff retention and – all other factors being equal – find it easier to attract new staff.”

A quick search on the FundEcoMarket research tool brings up strategies from several fund managers that consider health and wellbeing policies. Julia explains, “In practice, this means they will favour companies with sound employment practices and companies that provide products intended to make us healthier and happier.”

We asked an ethical researcher at a wealth management firm how close they really get to looking at mental health. While difficult to measure directly, she comments that many proxy indicators exist, such as turnover rate, absence rate, employee satisfaction, evidence of stress management/wellbeing programmes and policies on flexible working. So some relevant data will be available (and probably in more comprehensive form from larger companies), but “it’s definitely more art than science”!

There are some big FTSE players that do – at least outwardly – appear to be promoting mental wellbeing. A number of ESG gurus we’ve spoken with recently highlight Fundsmith favourite Unilever for committing to its vast Sustainable Living Plan. In addition to various measures aimed at employee welfare at Unilever HQ and along the supply chain, the company has set itself many external-facing goals. Its health and wellbeing ones are centred on fundamentals like improving access to safe drinking water and hygiene products, but notably include Dove Self-Esteem programmes for young people. Unilever has also pioneered body image-positive ad campaigns for women and ‘anti-stereotyping’ campaigns aimed at men.

British economist Richard Layard would approve. Regarded as one of the first happiness economists, his current focus is mental illness prevention and the positive impact this would have on society and the economy. For those with the stomach for academic pontificating and number crunching, his paper on measuring wellbeing gives some useful steers on how life satisfaction and emotional state can be gauged.

To end this Blue Monday blog on a cheerful note, companies are starting to take note of mental wellbeing in the workplace. And the more ESG analysts and portfolio managers push the issue, the greater the pressure will be for companies to up their game. If more data on wellbeing is expected to placate investors, there will be a clearer picture of issues and greater opportunity to address them. More measuring means less suffering in silence.

Perceptions, worries and fears around responsible investing will all revealed in detail in our upcoming Responsible Investing Review, of course, available in spring 2019. We have spoken in-depth to over 60 experts on the issue, including private investors, financial advisers, discretionary fund managers, and more, and have consulted over 1400 stakeholders through quantitative means.


Annalise Toberman

Annalise has spent her working life intensively researching B2B and B2C audiences in the financial sector. A keen qualitative researcher, she has conducted thousands of interviews across advisers, DFMs, fund houses, platforms, pension providers and consumers.


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