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The Effects of Work-Life Balance on Companies, Individuals, and Their Families from Around the World

Final Report Summary - NIFREI (The Effects of Work-Life Balance on Companies, Individuals, and Their Families from Around the World)

The short-term and instrumental used to manage in the current environment pushes organizations away from their responsibility toward various stakeholders, mainly focusing on stockholders and financial results. However, it is really difficult to generate sustainable value with such a limited view of the reality of the business and of the world.

Conscious management calls for social responsibility and sustainable development not only from an economic perspective but also from a social, family, and environmental perspective, in such way that it does not leave aside certain essential variables that affect what is most important for people: their wellbeing and their families, their quality of life, and the future of society at large.
Sustainable development is closely linked to human ecology, as it is the person who, with his/her decisions, can enhance or deplete the ecosystem in which he/she lives. Responsibility is born out of a more global and anthropological vision of the company, which takes into account the interdependence of the people and the environment, and considers the benefits of other aspects that are not purely economic.

The company is without doubt the institution with the greatest impact on the human beings, their families and society at large. Organizations influence life quality of their employees and enhance or hinder their ability to satisfy other vital needs and roles. Therefore, it is crucial that companies contribute so that work, family and personal life enrich each other, since they are fundamental, indispensable and complementary dimensions in the life of men women.

Companies must respond with flexibility to the personal and family needs of their workers. Without time, energy or adequate compensation, not only employees are less productive, but also they are not capable of having children, raise them, care for their elderly, and participate as active citizens to improve society. And that loss has a great repercussion both for the person and for the whole of society.

Hence the necessity of a new responsibility arises, Corporate Family Responsibility (CFR), as the internal, essential and nuclear dimension of Corporate Social Responsibility (CSR).

CFR, an emerging value:
CFR, a term coined by the ICWF of IESE, which is at the core of the IFREI project, refers to the extent to which the company counts on the leaders, culture and policies of flexibility to foster the integration of work, family and personal life. A company with CFR has managers that:
- Promote that every decision made takes into account the people
- Create flexible and equal opportunity policies and practices
- Foster worker commitment and satisfaction
- Increase competitiveness and sustainability of the company

The IFREI (IESE Family Responsible Employer Index), measures CFR and its impact on people, society and the results of the company; it is a model based on a system that puts the person in the center of the company. The IFREI project, in which 21 countries of five continents have participated, contrasts the information provided by the managers with the information provided by its collaborators.

CFR level is determined according to three dimensions: policies, supervisor support and the organizational culture, that affect whether or not the worker may reconcile his professional, personal and family life, factors that make-up and contribute to the environment in which the employee works.

A low level of CFR is which hinders the systematic integration of professional-family-personal life. This situation produces what we name as a “polluted environment” that in turn creates a high degree of dissatisfaction, stress and loss of motivation by employees, which leads to the desire to leave the company.

On the other hand, companies that promote FCR create what we name “enriching environments” that foster satisfaction with the reconciliation of work and family; this in turn creates high commitment, higher quality of life and a higher level of general health. CFR also facilitates a greater amount of time dedicated to raising small children, caring for the elderly and other dependent people, and tending to different commitments in various fields of social life.

Results in the world:
The IFREI Study analyzes the environment in which people work. Our data demonstrates that, within the same organization, some employees may develop their tasks in an environment that allows them to integrate their work and family life while others, on the contrary, find that their environment systematically makes it difficult for them to have this integration. What are the causes of this contrast? The data of the 16,000 people from all five continents, who so far have participated in our study, and represent a universe of more than 100,000 people, indicate the following:

1. The lack of flexibility policies available to workers, as well as the poor communication of them, or the difficulty to access them.
2. The diverse management styles of some supervisors; while some may facilitate the employee’s ability to reconcile in the same company others may or hinder it.
3. The existence of cultures, or subcultures, which generate different microclimates within the same organization that may value and respect family to a different extent.

According to the IFREI study, less than half of the population surveyed, 46%, find themselves in an environment that promotes the integration of work and family (15% in an enriching environment, 31% in a favorable environment); the rest of the population surveyed, 54%, work in a difficult and hostile environment toward family and integration (41% in an unfavorable environment, 13% in a polluted environment). (See attached “Figure 1”)

The results around the world confirm that people who have their supervisor’s support, have access to conciliatory policies, and an environment culture, which is favorable to CFR have:
1. Fewer intentions to leave the company- Only 5% of the persons who are in an enriching environment claim to have the intention of leaving their current organization, compared with 50% of which are in a polluted environment.
2. Higher satisfaction with work-family balance- 16% of people who are in a polluted environment, claim to be satisfied with the way they integrate work and family. On the other hand, 60% of those working in enriching environments are satisfied with their conciliation.
3. More productivity- In an enriching environment people are 19% more productive than those who work in polluted environments.
4. Higher perception of company support- 88% of workers who are enriching environments perceived that the company supports them, compared with 26% of people who are in environments that are difficult for them to reconcile.
5. Better health- 78% of respondents expressed general good health when in an enriching environment, compared with 55% of those who are in a polluted environment.

a. When employees have to take care of young children and their environment is enriching, their health is 40% better to that of those who take care of their children and are in a polluted environments.
b. Employees who care for dependent parents and work in environments that allow them to reconcile, say they enjoy excellent health, 71% more than those who are in the same circumstances and work in polluted environments.
6. More dedication to their young children- persons who are in enriching environments, dedicated weekly: 21% more time to have dinner with their children, 32% more time playing with them and 37% more time to read together, than those who are in polluted working environments.
7. Better quality of life- 83% of the people who are in polluted environments considered to have poor quality of life. On the other hand, 54% of people whose environment is enriching perceive a high quality of life.

In general terms, the results by continents show the same trend as those mentioned before. It is worth highlighting:
1. Africa- 73% of the people who work in enriching environments appear to have a high level of quality of life, compared with 23% of which who are in environments that make it difficult for conciliation.
2. Asia- None of the people working in an enriching environment has an intend to leave the company, compared with 45% of the people in polluted environments.
3. Europe- 3% of people who are in polluted environments perceived support from the company, compared to the 87% who are in an environment that allows them to reconcile.
4. Latin America-
o Ecuador- 16% of those who work in polluted environments have a higher intention to leave the company than in the rest of the world.
o Guatemala- 90% of those working in polluted environments perceived lack of support from the organization.
o El Salvador- In enriching environments people are 8% more productive than the rest of the world.
o Argentina- 89% of the respondents (11 points more than in the rest of the world) say they are in general good health when their environment is enriching.
o Chile- out of the employees which work in enriching environments, only 3% want to leave the company.
o Peru- 77% of the people who work in polluted environments stated not having good health, compared with the 55% worldwide.
o Colombia- 96% of those working in enriching environments perceived support from their organization, compared to the 2% who are in environments that hinder conciliation.

CFR and management styles
The data obtained in different countries indicate that 70% of employees are afraid to ask for flexibility or other measures which step out of the standard.

Companies that encourage CFR are creating greater loyalty and commitment to the organization. What is the key that makes it possible? Policies alone are not enough to create a culture that allows people to integrate their personal, family and professional life. It depends mostly on the style of leadership which is exercised. Formal systems contribute to carry out the company's strategy, but its effectiveness depends on having leaders capable of boosting emplyees’ commitment.

If employees perceive that their managers encourage CFR:
1. Their motivation grows by 58%
2. Their intention to leave the company is reduced by 48%
3. The enrichment for work and family increases by 18%
4. Their level of commitment is 25% higher

In order for the aforementioned to take place the manager has to support its employees through:
1. Emotional support- Generating empathy to understand the personal and family situation of the employee in order to counter possible conflicts.
2. Instrumental support- Organizing work in a flexible way, to combine the right balance of work and family life with the required labor productivity.
3. Be a role model- Showing exemplary behavior when it comes to the management of their own conciliation.
4. Manage flexibility policies- Managing and facilitating the use of flexibility policies and practices in a creative and effective way.

It is necessary to count on managers who exert a kind of leadership which is able to discover what suits the organization to make it effective, make the company more attractive for people who work, and maintain and strengthen unity. The manager leader is the front-runner of FCR who inspires trust and builds strong and stable ties.

The future
All cultural changes take time and leaders who are able to see opportunities in times of crisis. Leadership, policies, and values of the company that incorporates CFR, provide enormous benefits, personal, business, family and social. As demonstrated by the research done in the IFREI project, CFR allows for the reduction of working hours, increases productivity and decreases absenteeism. It also manages to bring out the diversity of talent that people possess, provides greater wealth, and makes companies more flexible.

CFR, as a fundamental part of internal Corporate Social Responsibility, allows to build a society in which women and men enjoy the same opportunities and can help create economic, social, and ethical value, thus making possible a more just, productive and sustainable society.

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