Three-quarters of employers (74%) say the purpose of their internal communication strategy is to shape the culture and create a sense of belonging.

However, only half (56%) believe their employees understand the organisation’s strategy, vision and purpose, according to Gallagher’s 2022/2023 State of the Sector report.

The gap exists at a time when employers and their people are navigating a host of variables, such as economic uncertainty, global conflict and the transition back to the office.

“Gallagher’s State of the Sector report provides clarity on the types of information organizations share with their teams, how they’re delivering messages and gaining an understanding about whether internal communication programs are making an impact,” said Ben Reynolds, Global Managing Director, Employee Communication Practice, Gallagher.

How can internal communication shape an organisation’s culture?

Creating alignment around organisational vision, purpose and strategy has traditionally been the raison d’être of internal communication. Has this changed?

Internal communication was always about communicating strategy first and foremost and creating alignment around an organisation’s vision and purpose. While this is still true, the need to shape culture and create a sense of belonging has become much more prevalent.

Overriding themes have been diversity, equality and inclusion (DEI); values and behaviours; and physical and emotional wellbeing, which shows increased convergence between HR and internal communicators.

At its core, internal communication is designed to convey strategy, followed by creating alignment around the organization’s vision and purpose. This remained the most commonly communicated topic in 2022 (45%), but in recent years, communication and HR leaders have placed more of an emphasis on shaping workplace culture and creating a sense of belonging.

As a result, diversity, equity and inclusion (DEI) became the second most frequently communicated topic in 2022. However, just four in 10 organizations admit to having a clearly defined DEI strategy, with another 38 percent still working on it.

“Even though many organizations are struggling to develop and execute on a DEI strategy, employers are deploying a range of tactics in an attempt to make positive strides,” Reynolds said.

“This includes awareness days or events (54%), employee resource groups or champions (48%), DEI training (45%), and a host of others. Leaders are looking to embed DEI throughout their communications, rather than through tactical siloed approaches. However, there’s still room for improvement.”

After another year of alarming climate change developments, the State of the Sector report explored how organizations embed their Environmental, Social and Governance (ESG) commitments into their employee experience.

More than one-third of organizations (36%) do not communicate ESG goals at all. Of those employers that do communicate ESG goals, the primary objectives are to inform employees of the organization’s ESG commitments and activities (26%) and encourage employees to support their local communities and charities (13%).

Rebalancing the employer-employee relationship 

Over the last three years, organisations have reflected, recalibrated, and redefined the employee experience, largely a result of Great Resignation when employee recruitment and retention consumed leadership teams.

After a period marked by high talent attrition, the labour market is turning. While employee value propositions (EVPs) have historically focused on talent attraction, we have seen growing awareness of their impact on talent retention through improved career wellbeing — with 56 percent saying their organisations have revisited their EVP in 2022, but only 28 percent believing this work to be well under way.

Existing EVPs also have limited affect, as just over half (53%) rated employee understanding of compensation, rewards and benefits as excellent or good.

This is a missed opportunity at a time when salaries are not keeping up with inflation and getting the most out of what you already have will be key.

Questions also remain about how employee feedback shapes organizations’ EVPs. The majority of respondents (84%) believe their organizations value employee feedback, and nearly two-thirds (65%) said their organizations do a good job learning from this input.

A deeper dive into how organizations gather feedback found nine channels, such as surveys, email, and one-on-one interviews, were utilized by at least one-third of respondents. But the mere presence of channels does not necessarily mean they are fully utilized.

Navigating uncertainty

Communication and HR leaders have faced countless obstacles since the onset of COVID-19. In 2023, respondents indicated lack of time and capacity (34%), disengaged employees (30%) and budget constraints (24%) were the biggest challenges to building stronger and deeper employer-employee connections.

“While budgets will remain tight for most organizations, it’s important to understand today’s employees expect much more than a paycheck from their employer,” Reynolds said. “They choose to stay at an organization because of its culture and values and the emphasis placed on employee wellbeing. Accomplishing this, while authentically weaving purpose and meaning into internal communication, will allow organizations to overcome challenges and reach their goals.”





Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at the University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.