Tips for Effectively Communicating ROI To Secure the EHS Budget You Need

With budgeting just around the corner, it’s time to think about how much you can ask for from your C-suite. Investing in health and safety can lead to improvement for the overall organization – especially in terms of employee support, retention, and overall employee well-being. Environmental programs may have a longer return on investment (ROI) due to increasing regulatory penalties, which may be easier to demonstrate. But you already know this. How do you have this conversation with the corporate suite (C-suite) level so they can see the value and benefits of a robust EHS program? Below, we’ll discuss strategies to communicate this with your C-suite leadership to secure the budget you believe is necessary to keep your employees safe and protect your organization.

What to Talk About

1. Financializing

First, you’ll want to clearly financialize the need for your EHS budget, especially any increases. Effectively communicating the return on an annual budget is critical. Everyone wants to work in a safe working environment. Improving EHS should be an easy sell, especially if you can connect it to the bottom line. Each organization is in a different place in its EHS journey, with some being very mature while others are just starting out.

For every organization, but especially those just starting out, you will want to ensure compliance with all local, regional, and federal regulations. Not only does compliance bring about a safer work environment, but it also shields your organization from unnecessary fines, liability concerns, and potentially negative attention. Clearly outlining how much of the budget is needed to simply meet regulatory requirements is a clear message to leaders.

If you aren’t sure what is needed to be compliant, identifying risks and compliance gaps by conducting an audit helps to prioritize and monetize EHS risks to the C-suite. Hiring a third-party expert to perform an audit can bring extra weight to program recommendations as well as provide a fresh perspective to your workplace. Compliance is generally a language that all of the C-suite can relate to. Providing risk in terms of potential fines associated with not fixing an identified issue can make a compelling argument.

Enumerating the potential fines can strengthen your budget request as well as show in simple terms the amount of risk that can be avoided by being proactive rather than reactive.

Could you reduce your workers' compensation claims and save the organization money? Looking at the cost of health and safety helps you to outline the financial benefits of implementing a robust EHS program. Articulating the cost to bring your organization into compliance is a clear message to leadership regarding obligations of the organization. This is a step that is often supported by industry peer perspectives, consultants, and statistics.

2. Demonstrating value to the organization

Although money speaks, it’s not the only thing that does. Bad press or negative publicity related to unsafe work practices or incidents that occur at your location can really damage your brand. In fact, in some parts of the world, such as South Korea, your C-suite can be held personally liable for failure to comply.

You can help demonstrate value to your C-suite by sharing how the initiatives you are looking to implement not only protect your employees but also protects the organization’s brand. It can be compelling to use incidents from other companies to demonstrate what you are working to avoid. Public information and the news have many examples of how injuries have happened in the workplace, in even low-risk environments. These incidents reflect poorly on the organization and demonstrate incidents you want to avoid. In a market for talent, having a brand associated with poor EHS compliance will likely limit who applies and/or joins your organization.

3. Tie it back to the current priorities of your organization

Every organization has strategic goals or initiatives in place to grow or keep their organization operating profitably and successfully. Many of these goals are advertised by the organization’s environment, social, and governance (ESG) reports. Other companies may set key business metrics (KBM) or key performance indicators (KPI) for EHS topics. An impactful way to communicate your needs to the C-suite is to show how your EHS goals and initiatives align with the current organization's ESG goals and business metric priorities. If attracting high-quality talent is critical to your organization’s success, outline how your initiatives compare to your competitors.

Your employees will expect to work in a safe and healthy work environment. Profitability can be heavily impacted by employee time off work due to injuries or workers’ compensation claims. Creating a correlation between health and safety and your organization’s strategy gives assurance that your initiatives are necessary for the organization to meet its goals and objectives. Your leadership can be enhanced when you both demonstrate to the C-suite knowledge of the organization’s goals/metrics, as well as able to translate what is needed to meet these expectations via improvements and/or investments into the EHS program.

4. Demonstrate and celebrate your successes

Your C-suite leaders also want to know what is going right. Doom and gloom aren’t always the most compelling argument to secure funding for EHS initiatives. Celebrate success by sharing innovations by employees to improve H&S or environmental compliance.

Examples of how EHS has had a positive impact on employees are important, too. Outline decreases in incidents and create a story that exhibits the benefits. For example, if your new cut-resistant glove initiative has reduced hand injuries by 30%, celebrate that by articulating the medical savings, the improved employee experience, and the prevention of potentially more serious injuries.

Look for examples of when employees used their first aid training at work or in their personal lives to demonstrate how it benefits the organization or your community. Employee testimonials are powerful. H&S is about people and telling their success stories and how we can all strive to maintain the same momentum.

Environmental compliance can be driven by data – for example, the total reduction in water or energy use. However, linking that change not just to the bottom line but to the impacts of the community the businesses reside in is essential. In areas where there is water scarcity, showing the reduction in cost to the facility and/or the volume of water recycled and reused in the facility is made more impactful when linking to the amount of water that was freed up to the community for drinking water for homes and other businesses.

How to talk about it

We’ve talked about what to talk about to the C-suite, so let’s spend a little time talking about how to talk to the C-suite. Individuals at the executive level are very busy with many competing priorities. When meeting with the C-suite, always come prepared with a detailed plan for how your recommended improvements can improve your ROI on EHS investments. However, keep the presentation high-level, but be prepared in case they ask for you to elaborate.

You should have already done your research to be able to zoom in on questions that may be asked such as:

• What is the competition is doing?
• What are industry-leading competitors doing?
• What are the organization’s biggest challenges and opportunities?

Leaders in the C-suite respond to those that authentically want to help and who can clearly explain the value in their proposal with such information. We recommend using PowerPoint or a similar tool to present your thoughts. Presentations work best when primarily graphic to show the impact of a concept and/or goal of the requested investment. Linking the success of EHS to the overall corporate ESG and business metrics will be critical.

Another successful strategy is to focus on the why of your ask, such as asking questions similar to the following: Why is this relevant now, why this will improve business, why is this level of investment necessary, etc. Finally, a C-suite presentation is not a monologue, but a dialogue. Make sure you listen, answer questions, and take a moment to get to connect with your organization's C-suite.

In Summary

It’s not just about what you’re talking about when it comes to asking for more budget in EHS, but how you talk about it. You recognize the value of your budget but getting C-suite on board can feel intimidating. With these above steps, you can walk into the boardroom confident that you’ll leave with your ideal budget in place.

Interested in learning more? Reach out to Antea Group about our Health & Safety Audits and Risk Assessments service line for more information on this topic.

About Antea Group
Antea®Group is an environment, health, safety, and sustainability consulting firm. By combining strategic thinking with technical expertise, we do more than effectively solve client challenges; we deliver sustainable results for a better future. We work in partnership with and advise many of the world’s most sustainable companies to address ESG-business challenges in a way that fits their pace and unique objectives. Our consultants equip organizations to better understand threats, capture opportunities and find their position of strength. Lastly, we maintain a global perspective on ESG issues through not only our work with multinational clients, but also through our sister organizations in Europe, Asia, and Latin America and as a founding member of the Inogen Alliance. Learn more at us.anteagroup.com.