As part of our ongoing interview series with members of the National Commission on Climate and Workforce Health, we caught up with Susan Potter, Commission Co-Chair and President of Mercer US and Canada, to discuss the health risks posed by our changing climate. In this Q&A, Susan explains why leaders need to act now and what steps they can take.

Why should business leaders prioritize assessing the risks climate change poses to their workforce?

Environmental risks have traditionally been interpreted as related to property, but the potentially catastrophic impact of extreme weather events and natural disasters on the health and well-being of employees and their families is an imminent threat. For many businesses, human capital is their most important asset. We recently surveyed employers on a wide range of benefit issues and asked them if their employees had been impacted by extreme weather events in the past two years. Almost two-thirds said yes. In a different survey of workers, nearly one in five (18%) said that extreme climate has negatively affected their health or the health of a family member, and an additional 44% are concerned about the potential impact on their health and safety. We saw during the pandemic that employers who stepped up to support employees’ physical and mental health earned their loyalty. The same principle applies to extreme climate events, which are growing ever more frequent.

Based on Mercer’s research, do many employers understand the health risks their employees face and the financial implications to their organizations?

While most employers likely have a general sense of the implications of extreme climate, according to our research, only 4% of employers have done a vulnerability assessment to learn which employees are most at risk. Preparing for climate-related physical and mental health risks can be a catalyst for companies’ innovation and growth. An essential first step is for business leaders to understand their vulnerabilities and make a plan to manage them. For example, extreme heat impacts worker productivity. As temperatures increase above 100°F, productivity decreases by 70% for outdoor workers. Business leaders can instill a culture of safety by prioritizing heat safety measures, including breaks, access to water and cooling stations, and modified schedules. A best practice is to involve employees in developing and reviewing the plan to ensure it’s practical.

What are some of the reasons more companies are not conducting assessments?

It is not easy to make the connection between extreme climate risk and the health risk to individuals. The data needed to do this work would typically reside in different areas of the organization (e.g. safety, HR, benefits) and may never have been consolidated and used in tandem. The good news is that HR and Risk functions are used to collaborating to mitigate people risks; that was another important learning from the pandemic and is a major step in creating a culture where risks are identified, understood, and addressed effectively. This will be essential in addressing climate-related health risks.

To be most useful, an assessment needs to identify not just the different kinds of climate-related risks that exist in each work location, but also the health risks in the employee population and how they intersect with the climate risks. For example, employees with cardiac issues will be especially vulnerable to extreme heat conditions. In addition, the escalation of climate risk and impacts has disproportionate effects on those with the fewest resources, so social factors must be considered as well.

What advice do you have for business leaders who are hesitant to invest in employee health risk analysis?

Business leaders should recognize that environmental issues are people risks, as climate events have a catastrophic impact on the health of employees, families, and communities. Given the magnitude of the risk, it is essential that leaders proactively assess, account for, and build a strategic response to mitigate the impacts of climate on their people and bottom line. Building a risk and response framework is beyond any altruistic endeavor; it’s a matter of recognizing the scale and systemic effects of climate change on people, businesses, and their communities. My recommendations are to:

• Be proactive. Start now. Set measurable goals.
  
  
• Build collaboration between HR and risk professionals; create a culture of continuous improvement and empower individuals across the organization to support it.  
  
  
• Embrace predictive analytics and modeling, which will allow organizations to identify and track people-related measures and insights for safety, physical health, mental health, and financial health.
  
  
• Assess safety culture within the organization, including employees’ ability to raise safety concerns and discuss behavioral health needs.

Let’s do everything we can to get out in front of this. It really does matter — and everything we are doing can, and will, make a difference.

Susan Potter is President of Mercer US & Canada and a member of Mercer's Executive Committee. She has more than 30 years of experience as a business leader and consultant, helping organizations develop innovative solutions for their human capital, risk, and business issues. Susan earned an MBA in international business from Georgetown University’s McDonough School of Business and a B.S. in mathematics from the University of Nebraska-Lincoln.