New proposals on employee engagement ‘totally inadequate’ Prospect warns

The ideas in a new report into corporate governance do not go far enough to tackle low workforce engagement

Proposals on workforce engagement in the newly-published review of corporate governance principles from the Financial Reporting Council do not go far enough, Prospect has warned.

The review was commissioned by government and led by James Wates CBE, from the Wates Group.

The section on workforce engagement simply says: “Companies should develop methods that enable them to engage meaningfully with their workforce and utilise such forms of engagement when taking decisions.”

Prospect general secretary, Mike Clancy said: “It is welcome that this review has acknowledged the importance of workforce engagement, but simply asking companies to speak to their employees without providing a framework for discussions is totally inadequate.

“Our economy needs a renaissance of collective bargaining in the private sector if we are to create a fairer economy and solve the productivity puzzle that is stifling economic growth. That requires a more assertive approach.

“Government and employers need to go much further than this report suggests. Employee engagement should not be something large companies are politely asked to do, but something required of them within a framework of collective bargaining on pay, terms, and conditions,” Clancy added.

Prospect released a report in partnership with think tank ResPublica earlier this year arguing for policies to reverse the decline of collective bargaining in the private sector.