The Evolving Landscape of Workplace Mental Health Management

The full articlefull article is available on the ISS-Corporate online library.

A New Focus on Mental Health in the Workplace

Mental health in the workplace has become a subject of increased relevance within the corporate world. In the wake of the COVID-19 global pandemic, it has been well documented that poor mental health in the workplace can lead to high rates of burnout, turnover, and sick leave. The American Psychiatric AssociationAmerican Psychiatric Association estimates that depression leads to a 35% reduction in productivity, contributing to a loss of $210.5 billion a year to the U.S. economy due to its associated medical costs and absenteeism.

The link between employees’ mental health and company performance is also reflected in the latest sustainability reporting standards. The EU’s Corporate Sustainability Reporting Directive (CSRD) includes reporting requirements on the topic of Health and Safety specifically regarding work-related injury and work-related illness metrics. CSRD’s European Sustainability Reporting Standards (ESRS) provide guidance that includes mental illness in the definitions of work-related injury and work-related ill health. Additionally, the ESRS guidance also states that “the undertaking shall, at a minimum, include in its disclosures those cases outlined in the ILO List of Occupational Diseases.” The International Labor Organization (ILO) List of Occupational Diseases includes mental and behavioral disorders where there is a direct link between work-related activities and the contracted mental or behavioral disorder. Therefore, if company operations involve activities that can lead to mental health concerns, the relevant outcomes will need to be identified and reported in disclosures. Following the release of the International Financial Reporting Standards’ (IFRS) draft proposal on the Sustainability Disclosure Standards, several expert responses request the inclusion of disclosure standards covering mental health.