UCD academics call for virus safety incentives for businesses

Study shows businesses that invest in workplace safety 20% more likely to ‘go under’

Business organisations such as retail groups have advised their members recently that customers will demand stringent safety practices to combat the spread of coronavirus. Photograph: Laura Hutton

Business organisations such as retail groups have advised their members recently that customers will demand stringent safety practices to combat the spread of coronavirus. Photograph: Laura Hutton

 

A team of UCD academics wants the State to incentivise companies to invest in anti-coronavirus safety measures, after a study suggested that businesses that spend to protect workers and customers are 20 per cent more likely to go bust.

The research was published earlier this month in the Management Science journal. It examined the fortunes of 100,000 businesses over 25 years in Oregon, with the data analysed by a global team of researchers, including UCD’s Mark Pagell, Mary Parkinson, Michalis Louis and Brian Fynes.

“Our research suggests that businesses that enhance their own prospects over worker safety will be more likely to survive as they will be both minimising their costs and maximising their cash flow,” said Mr Pagell, who is a professor of sustainable supply chain management at UCD.

“More cautious competitors will in essence put their own survival at risk by better protecting the rest of us. This suggests that government and employer representative bodies need to think about rewarding those businesses that do protect their workers and protect them from being punished financially.”

Mr Pagell, who also said the research shows that a “typical business” will prioritise its own financial interests over investing in safety. In an era when anti-coronavirus protection measures are considered essential as businesses emerge from lockdown, this risks “at a cost to workers and society”.

“Some business will reopen the second they are allowed after Covid-19 restrictions ease and with the minimal legally-mandated protections. Others will wait until they are sure they have plans in place to fully protect their workers and customers,” Mr Pagell said.

He highlighted the fact that virus clusters have emerged in meat processing factories in recent weeks, despite warnings from workers including walkouts by staff at some facilities in the north in March.

Business organisations such as retail groups, however, have advised their members recently that customers will demand stringent safety practices to combat the spread of the virus, and that it is in their overall best commercial interests to assuage customer fears.