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Legislation makes employee engagement a boardroom issue


As many of you will know, UK busi­ness­es of a cer­tain size have report­ing require­ments relat­ed to employ­ee engage­ment and rep­re­sen­ta­tion. In a nut­shell, the reg­u­la­tions refer to Direc­tors’ Reports, which now need to make clear:

  • How the direc­tors used or reflect­ed employ­ee inter­ests when mak­ing busi­ness decisions.
  • How the direc­tors have engaged with their employees.
  • What impact those inter­ac­tions have had on busi­ness decisions.

This is inspired by ongo­ing efforts by the gov­ern­ment to improve employ­ee voice in the board­room (and per­haps a response to the ever-widen­ing gap between exec­u­tive and work­er pay). It doesn’t apply to every­one: you need to have at least 250 employ­ees and either a turnover in excess of £36 mil­lion annu­al­ly, or a bal­ance sheet that exceeds £18 million.

Here’s why we should all be delight­ed by this.

First of all, more con­ver­sa­tions can only be a good thing. Yes, we would say that, because we believe that more con­ver­sa­tions are almost always a good thing. But the num­bers back us up: feed­back helps us to improve and devel­op; the more we talk, the more trust and can­dour we cre­ate, which improves work­ing rela­tion­ships; under­stand­ing people’s needs in an ongo­ing way (and act­ing on them) improves work engage­ment, which improves per­for­mance, which in turn improves pro­duc­tiv­i­ty and profitability. 

The key is to use the feed­back you cap­ture to improve work out­comes. It’s a top­ic we have explored else­where but, in short, work engage­ment is the key dri­ver of pro­duc­tiv­i­ty. Ask the right ques­tions; cap­ture engage­ment data in a con­tin­u­ous way (to ensure that your results aren’t dis­tort­ed by per­son­al ups and downs); demon­strate that you’re tak­ing action and that that action has a mean­ing­ful effect on work­ing process­es, resources and rela­tion­ships. Those things do more for employ­ee engage­ment than any num­ber of periph­er­al expe­ri­ences. They show a will­ing­ness to make work (not work­place expe­ri­ence) better. 

Most organ­i­sa­tions now run some sort of employ­ee engage­ment sur­vey or employ­ee feed­back pro­gramme. The mis­take many make is in not trans­lat­ing that data into mean­ing­ful action. The gov­ern­ment has come at the issue from the oth­er direc­tion, high­light­ing the impor­tance of employ­ee voice in an atmos­phere of accusato­ry head­lines around exec­u­tive remu­ner­a­tion. But whether organ­i­sa­tions are doing this because of good inten­tions or leg­is­la­tion, the oppor­tu­ni­ty remains the same: to boost per­for­mance by lis­ten­ing to their people. 

To dis­cov­er Clear Review’s rev­o­lu­tion­ary new think­ing on engage­ment, see our prod­uct page or down­load our new ebook.