How can financial firms meet ever-growing profit targets and still support employee wellbeing?

Feb 29, 2024

For ambitious executives, a career in financial services offers the prospect of excellent job opportunities, rapid progression and great pay. But the financial services sector is often associated with long hours and poor work-life balance.

Recently, these challenges have been exacerbated by market volatility and the threat of a recession– all putting further pressure on employees. Firms are also facing increased regulation and changing expectations from customers looking for a more personalised banking experience.

Against this back drop, we’ll be looking at how financial services firms can remain competitive while, at the same time, supporting employee work-life balance and wellbeing.

The impact of long hours in the workplace

Long hours have traditionally been the norm in the financial services sector. To a certain extent, it goes with the territory in a high-pressure, high-performing industry. Some would argue that it’s the price you pay for the large pay-check and job opportunities. But at what cost to the wellbeing of finance executives?

Research has shown that finance jobs across the board can regularly average 45-72 hours a week. In the US, junior staff at investment banks can sometimes work100 hours a week. Long hours may be sustainable for a short time but, in the longer term, this will inevitably impact employees’ mental and physical health and lead to burnout.

Tired employees don’t make productive employees. Plus, there’s also a greater risk of errors when people are regularly putting in long hours. And, of course, mistakes can have huge reputational, regulatory and financial impact. So, firms need to take this issue seriously – to protect their employees and their businesses.

Reassessing life’s priorities

The pandemic has prompted many finance executives to reassess their work and life priorities. Quality of life is more important than ever.

Only 2% of investment bankers surveyed by Upslide said that they had a good work-life balance. A whopping 76% said they would consider a lower salary for a more balanced lifestyle.

Firms recognise that they must do more to prevent losing top talent due to workplace burnout – with some adopting new strategies to help employees reclaim their personal time.

In Upslide’s research, 47%of respondents said that their employers currently have measures to prevent working over the weekend, while 34% said they have measures to prevent working extra hours during the week.

Nonetheless, the latest workplace statistics suggest that this is still a problem across the industry.

Is flexible working the answer?

Supporting remote and flexible working can, in part, provide a solution. The finance industry has historically lagged behind others on this front. In the past, remote working has been challenging in areas where workers need access to trading floor technologies and secure customer data platforms. But a culture of presenteeism has also been partly to blame – with resistance in parts of the industry to staff working off-site.

The pandemic forced firms to shift quickly to remote working and adapt accordingly. For example, more than 19,000 Danske Bank employees switched from office to home working in 2020. The bank found that this resulted in increased customer satisfaction, employee engagement and productivity. So, the management team decided to shift to permanent hybrid working and provide a cash subsidy for home-office adaptations.

Similarly, the Bank of Ireland introduced a fully flexible hybrid model in 2022. A recent survey showed that 77% of bank staff felt it supported their team to work well together and eight out of ten felt it helped them to balance work and personal commitments.

It’s telling that two financial services firms (HSBC UK and the Bank of Ireland) finished in first and second place respectively at the inaugural Hybrid Working Awards in 2023 – beating off competition from organisations outside the industry.

For businesses like these, hybrid working offers benefits for employees and it also enables them to recruit from a much wider pool of talent – increasing diversity.

Reducing the mental load

Of course, flexible working can only provide part of the answer.

Financial firms also have a role to play in reducing the mental load on employees. It’s not just about where your people work – but how they work. That could mean banks mandating limits on working hours, keeping a closer eye on individual working patterns and even providing work-life balance solutions to help with life tasks (such as dry cleaning and holiday planning).

But there also needs to be a fundamental shift in how businesses operate. Many firms continue to rely on manual processes for back-end operations such as accounting reconciliations and loan processing. Over the coming years, businesses will need to capitalise on advancements in AI and machine learning to help them streamline and automate processes – helping to reduce the burden of repetitive manual tasks on their people.

Tackling mental health and burnout

However, if financial services firms want to retain the best people, they also need to think more broadly about mental health and burnout in the industry.

Prolonged stress and overwork can impact productivity and cause a wide range of health issues, such as high blood pressure, heart disease and depression. Research from MHFA England found that 83% of employees from the financial services sector have considered changing jobs due to the impact of work on their mental health, with nearly half of those taking the plunge. In total, 60%of 1,000 finance workers surveyed said their employers could do more on workplace mental health and wellbeing.

Commenting on this research, Vicki Cockman, MHFA Workplace Lead, said: “Our research shows the clear link between mental health and talent retention. Employers should act now to identify their organisation’s needs and put the right provision in place to create a healthy culture for staff. Acting early will help to prevent a deepening talent crisis.”

Progress has been made in tackling the stigma around mental health in the financial sector. However, there’s no doubt that more work is needed to normalise conversations on these issues. In a high-pressure industry, it’s sometimes difficult for employees to admit they’re struggling amid fears over job security. MHFA’s research revealed that one in four employees are not comfortable discussing mental health issues with their manager.

The cost of poor mental health

Deloitte estimates that mental ill-health costs UK employers £56 billion every year. Every £1 spent on staff wellbeing gives an average return of £5.30 in reduced absence, presenteeism and staff turnover. So, looking after employee wellbeing is good for business but it also enables firms to differentiate themselves as an employer.

Banks are starting to take positive and preventative action on mental health. Many financial firms are now providing:

·      mental health awareness training

·      wellness workshops

·      stress management activities

·      counselling.

For example, Lloyds Bank offers a range of resources and support, including mental health tools and online training. More than 2,500 Lloyds Bank staff have been trained as mental health advocates. Other banks have followed suit with similar initiatives.

Clarifying managers’ responsibilities

One of the challenges is that managers often don’t know what’s expected of them in terms of mental health support. A survey of 1,100 business leaders revealed that 58% do not feel they clearly understand their responsibilities – indicating a need for urgent training in this area.

Managers have a hugely influential role in workplace culture so they need to feel empowered to promote wellbeing – and have the right tools and training to make this happen.

It’s important that managers set clear objectives and review workloads to ensure that targets are realistic and manageable. Regular check-ins with team members can provide a ‘safe zone’ to air any concerns and help managers spot the early signs of burnout or mental health issues before they become a significant problem.

Making employee wellbeing a priority

With a cost-of-living crisis and a looming recession putting further strain on employees, firms need to focus more than ever on adopting a proactive approach to mental health and work-life balance. Employee wellbeing is no longer a ‘nice to have’ – it’s vital for any sustainable business.


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