Employee Benefits

Managing Financial and Talent Risks to Create Growth Opportunities for Organizational and Employee Wellbeing

By Jeff Leonard

Businesses bank on their CFO’s ability to expertly manage two interrelated areas of responsibility — supporting successful growth and mitigating financial risks. And that CFO’s approach to the financial dimensions of organizational wellbeing and talent management strongly influences their ability to achieve these core goals. People are their employer’s top asset because attracting, motivating and retaining talent are essential to sustained growth. The challenge is optimizing this relationship cost-efficiently while protecting or strengthening the organization’s brand.

Assessing needs

There are some critical issues and opportunities that merit special attention when developing or refining a financial management strategy. On the workforce side of the equation, strong economic growth and low unemployment contrast with the financial stress many employees are experiencing. More than 40% can’t afford a $400 financial emergency.¹

At the same time, employers are under the microscope of new legal, regulatory and public accountability requirements — magnifying the importance of their fiduciary responsibilities to employees participating in their retirement plans. There’s also the need to confront an upswing in leadership transitions and other organizational challenges as baby boomers approach and enter retirement.

Setting priorities

These financial management trends emphasize the need for:

Retirement plans that provide employees with the tools, resources and educational guidance to build a secure future of financial wellbeing
Executive compensation and benefit packages that help retain key leadership in a highly competitive market
Investment programs for both defined benefit and defined contribution retirement plans that fulfill fiduciary duties

In each case, the smarter approaches are those that align with the needs and values of both individual employees and the organization as a whole. Get them right, and they become part of the essential machinery of a well-functioning enterprise. Get them wrong, and they can become major sources of risk — including reputational threats. Negative headlines can throw an organization off track for months, and may impact growth for a much longer period.

Standing firm on shifting ground starts with asking probing questions of financial stakeholders and decision makers. Their feedback helps identify where the most important risks and opportunities lie, and offers insights into formulating a plan to address them.

Jeff Leonard
North America Practice Leader,
Financial & Retirement Services
Gallagher Benefit Services, Inc.

¹CNN Money, “40% of Americans can’t cover a $400 emergency expense,” May 2018

Consulting and insurance brokerage services to be provided by Gallagher Benefit Services, Inc. and/or its affiliate Gallagher Benefit Services (Canada) Group Inc. Gallagher Benefit Services, Inc., a non-investment firm and subsidiary of Arthur J. Gallagher & Co., is a licensed insurance agency that does business in California as “Gallagher Benefit Services of California Insurance Services” and in Massachusetts as “Gallagher Benefit Insurance Services.” Certain appropriately licensed individuals of Arthur J. Gallagher & Co. subsidiaries or affiliates offer securities through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC and or investment advisory services through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Neither Kestra IS nor Kestra AS is affiliated with Arthur J. Gallagher & Co., or Gallagher Benefit Services, Inc. Neither Kestra AS, Kestra IS, Arthur J. Gallagher & Co., nor their affiliates provide accounting, legal, or tax advice. GBS/Kestra-CD(319574)(exp062020)

This material was created to provide accurate and reliable information on the subjects covered, but should not be regarded as a complete analysis of these subjects. It is not intended to provide specific legal, tax or other professional advice. The services of an appropriate professional should be sought regarding your individual situation.