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What business can learn from the human costs of COVID-19

Lessons from L'Oreal, Dow, MGM Resorts and Norcom.

Social distancing markers on a floor.

Social distancing markers on a floor.

As the pandemic has killed half a million Americans, too often "essential" workers have felt expendable. Facing far less risk, people with the luxury of working from home nevertheless have faced new stressors on their mental health, including blurred work-life boundaries, social isolation and ceaseless caregiving.

Channeling lessons gleaned from the corporate response over the past year, sustainability leaders at the GreenBiz 21 virtual event in February explored what went wrong and right within corporate supply chains and management practices — and how this knowledge might be applied to avoid future mistakes and improve business resilience.

Let's start with what some of went wrong. 

Roughly in order: Line cooks, farm laborers, delivery and logistics personnel, followed by facilities and manufacturing workers, had the highest spikes in death rates compared with pre-COVID-19 time periods, according to research by the University of California at San Francisco. Latino and Black workers suffered disproportionately.

That held true in Arkansas, where poultry plant virus outbreaks epitomized the hazards for vulnerable, elbow-to-elbow workers. In that state, during the coronavirus's early U.S. months, Latinx and Marshallese people suffered 400 percent greater rates of infection compared with the white population, said Mireya Reith, founding executive director of Arkansas United. 

The advocacy group for immigrant workers did not receive information about the pandemic in Spanish or data about the impacts on the communities it serves until at least six weeks into the crisis, she added.

It really seems to come down to maintaining people's dignity, to recognize that people are under abnormal stress, and sharing the best information that we have quickly.

Reith received a midnight email in June from the Marshall Islands Consul General Eldon Alik, who pled for help because so many Marshallese poultry plant workers were dying. Reith forwarded the message to corporate leaders and appealed to the state to direct resources toward improving safety practices, testing and vaccines for immigrant workers. Even with such bridge-building attempts, by August at least 35 Arkansas poultry plants experienced COVID-19 outbreaks.

Thankfully, by December the infection and death rates among the nonprofit's constituents finally had become proportionate to that of the general population, said Reith, who credited the creative work of public-private partnerships. Even so, that same month employees walked out of one chicken-processing plant demanding better social distancing measures, losing some of their pay and bonuses.

"We should warn that we are seeing some of the same things that happened at the start of the outbreak happening once again, and maybe questioning whether lessons truly have been learned," Reith said.

Speed and dignity

On the other hand, what could go right?

Several states away in Georgia, early last year the leaders at paper office supply maker Norcom couldn't decide how to handle the coronavirus threat. They did agree to prioritize speed.

They also sought to reassure every worker that it wasn't necessary to choose between their financial security or their health and privacy, said Chad Coggin, director of manufacturing, supply chain and continuous improvement. No positions were cut; instead, Norcom continued with existing improvement plans, creating new roles and a career-pathing system.

"The good news for us is that we had to make rapid change — but that creating rapid change to try to adapt to the changing information, the updates, the uncertainty, the volatility, doesn't have to require a military-like heat of war kind of devotion," Coggin said. "It really seems to come down to maintaining people's dignity, to recognize that people are under abnormal stress, and sharing the best information that we have quickly."

The company established temperature screenings, leaflets and six-foot physical distancing markers along its 50 to 300 foot-long production lines. In addition, an "error-proofing" approach attempted to make up for the limits of individuals' sense of self-preservation. Norcom reconfigured workspaces and expanded break areas, and it modified tasks, cross-training employees. Two-way radios and amplifiers helped workers hear one another without leaning close together on the noisy plant floor. Ultimately, some occasional positive tests did not lead to viral spread within the company, Coggin said.

Our efforts at work could reduce our team members' overall risks in and out of work.

He also credited a single number for guiding the positive aspects of Norcom's COVID practices: 35 percent. That's the percentage of waking hours that an employee spends at work over the course of a week. Coggin and others opted not to focus on the negative risk of spending eight hours together with potential virus carriers.

"Instead, we started thinking of it as a 35 percent window where we might create a safer environment than we experienced just going about our normal day on the outside of work," he said. "So in other words, our efforts at work could reduce our team members' overall risks in and out of work. We saw it as helping in a much larger sense than just keeping the operation going."

Managing human capital

How can people be central to sustainability conversations? How can companies care for workers? Those questions have risen to the top of the list for more companies in recent years, thanks to the pandemic and he #MeToo and Black Lives Matter movements.

"Of course, COVID is changing everything we do in the way of the workplace and the return to work, and the health and safety as we return to work," added Mike Wallace, partner at Environmental Resources Management (ERM) in Portland, Oregon. "Now as we do a materiality assessment, we're seeing health and safety and HR and the general counsel and investor relations, all coming together to build a real kind of cohesive sustainability team," he said of a trend surfacing in ERM's consultancy work with companies.

Dow Chief Sustainability Officer and Vice President of Environmental Health and Safety Mary Draves said the company is recognizing the intersections among environmental and human concerns, and the risks related to them. Last year, Dow brought EH&S functions out of manufacturing and under her leadership.

Hearts and minds

Eliminating or reducing worker injuries is part of a "total worker health strategy" at Dow that has been especially relevant during the coronavirus crisis, an "aperture moment" for the company that spun out from DuPont in 2019, Draves said. Acknowledging psychological health, even how it fits into the worker injury rate, has become more of a focus — and a pillar of Dow's license to operate in a community, she added. 

"Think about the power of someone on the shop floor — when they take an issue to their supervisor that their voice is heard, and it's acted upon — that it makes in your performance," Draves said.

For Jyoti Chopra of MGM Resorts International, the human toll of the coronavirus has been devastating. Lives in the company were lost, and two-thirds of the workforce was furloughed. Fully remote work was a huge cultural shift. The chief people, inclusion and sustainability officer described regular employee surveys to take their emotional pulse and share it with company leaders.

COVID is changing everything we do in the way of the workplace.

"Where we’re seeing people struggle is around the boundaries," she said of the blurring of professional and personal time for remote workers. Ad-hoc virtual forums help people connect beyond their immediate working team, and employee blogs, a hotline, and a new fitness app target stress reduction.

"Just being in the moment, understanding the dynamics and offering strategic resources can go a long way to support your teams and your people," Chopra said.

Keeping in touch

While the pandemic forced leaders at a variety of companies to focus on worker well-being in new ways, remote teams embraced digital communication.

Prior to COVID, Dow had created internal communities for areas such as circular economy, life-cycle assessments and valuing nature. Without the in-person water cooler for impromptu interactions, those virtual groups helped to elevate expertise across the organization and help employees eager to accelerate their learning.

For Chopra, real-time communication was key early in the pandemic, as information changed by the day or even the hour. Resorts, casinos, bars and every other company facility shut down in a matter of days. One of her first steps was to set up a WhatsApp group for her team. Connecting virtually helped in March to mobilize teams to handle food, passing out hundreds of thousands of tons of food to families in need in the Las Vegas area.

"I’m particularly proud of the sense of humanity that rose above it all and came together," she said.

Katrina Shum, North America sustainability officer at Lush Cosmetics, described an ongoing effort to genuinely listen to individuals and understand what they were facing at home. That came as the family-operated global soap and lotion maker attended to health orders, safety protocols, benefits and local rules for its offices, 250 shops and seven manufacturing facilities.

During initial COVID shutdowns, the company had daily calls across teams, which eventually became less frequent. Virtual managers’ meetings tackled such issues as digital detoxification and overall wellness with tactical, everyday tools. Lush also added "take them as you need them" time-off days for wellness.

The leading indicators

As companies slowly emerge from COVID and more people return to work in person, which ratings, rankings and internal work can help leadership?

Rating agencies typically look at lagging indicators, such as the number of fatalities, accidents or cases of medical treatment, noted Malcolm Staves, corporate health and safety director at L'Oreal. "What really matters, though, is how efficient and effective and agile your system is in how you respond to a crisis like COVID, how you respond to a situation at work. And for that, you need leading indicators."

For example, L'Oreal encourages workers to report safety improvement opportunities that may prevent accidents. It gets about 75,000 of these reports a year, driving employee engagement and leadership growth, Staves said.

However, the phrase "human capital" can be insensitive given that corporate accounting systems treat people, receiving wages and benefits, as a liability, Wallace of ERM noted. What if people were treated as assets instead? The year-old Capitals Coalition is driving such a view, seeking to unite initiatives to help businesses better value natural, social and human capital.

Its director, Natalie Nicholles, held up Unilever as a positive example for its goal, shared in January, to pay all in its supply chain a living wage by 2030, from offices to factories to farm fields. Yet in general, the lack of depth about ESG factors leaves much to be desired in business, because companies have not had to report on human capital within financial frameworks, experts agreed. New Securities and Exchange Commission requirements demand companies to disclose human capital resources and objectives that are material to a business, but they don't define what human capital means.

"As a society, we all want companies to be investing in people and nature, and as a way of creating long-term value, not only to the business, because that means profits, but value for stakeholders," Nicholles said. "And that is a trend that COVID has just absolutely accelerated."

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