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Scott Ozanus, guest blogger, is the Deputy Chairman and Chief Operating Officer at KPMG. He is also a member of the ReadyNation CEO Task Force on Early Childhood
Better workers. Better communities. Better lives for our citizens.
Why is a company that employs over 189,000 people around the world, and hires about 40,000 people every year, concerned with early childhood?
It’s because all over the globe, countries and companies face a common challenge: How best to strengthen their economy and workforce, while also taking societal concerns into consideration. Early childhood is key to a productive current workforce as well as nations’ future success.
How does a child’s experience at two-years-old translate into being a fulfilled, productive adult? Research shows that the learning gap between advantaged and disadvantaged children can show up as early as nine months of age. A study showed that by age three, children of low-income families had half the vocabulary of more advantaged families. What’s more, disadvantaged children can begin primary school as much as 18 months behind their more-advantaged classmates. Research also tells us that a child’s level of math knowledge in preschool predicts their later academic success in primary and even secondary school. Moreover, a child’s grasp of early math skills predicts later reading achievement even better than early reading skills do.
We want children to have access to programs that can put them on the path to academic, career, and life success. We want them to have the characteristics businesses value most, such as the ability to communicate well or collaborate effectively. We want them to have fulfilling lives and a positive impact on the economies of nations the world over.
And data shows early childhood programs can have a profound impact. An overview of 56 studies across 23 countries found impacts on health, education, cognitive ability, and emotional development. A study by Nobel Laureate James Heckman found that participants in an early childhood program in Jamaica had 25% higher wages – 20 years later. Heckman says the return on investment in early childhood is even higher than the stock market from World War II through 2008.
Furthermore, quality child care helps parents work and be more productive today. Access to quality child care increases stability for current workers by limiting absences, employee turnover, and other issues that reduce productivity. And there’s a pressing need for such access as many countries want to increase their rate of female employment.
That’s how investing in the early years can transform not just the lives of children, but their communities, and ultimately their countries, making them healthier and more competitive in the global economy.
An increasingly digital economy will place greater premiums on employees who have the skills needed for jobs that cannot be automated by new technologies. Even now, it is tough to find qualified workers and retain employees in communities where early childhood programs are lacking.
We think it’s important to get involved in those communities. That’s one reason why, nine years ago, KPMG partnered with First Book, a nonprofit social enterprise, to create an organization called KPMG’s Family for Literacy (KFFL). Our mission is simple - remove the barriers related to access to books for children in need in order to “level the playing field.”
We’re focused not only on engaging our employees in this effort, but on the families and communities to which they belong.
KFFL aims to put books and educational resources in the hands of as many children from low-income families as we can. Our employees spend time in schools serving communities, reading to students, and giving them books of their own.
To this point, we’ve put close to three million books in the hands of low-income families and the program has expanded around the world including India, Mexico, UK, and South Africa.
This global problem is too big for any one company to solve.
A recent article in The Lancet, the renowned UK medical journal, revealed that a shocking 43 percent of children younger than five years of age living in low- and middle-income countries are at risk of suboptimal development because of poverty and stunting. The 250 million children at risk of not reaching their developmental potential are likely to lose about a quarter of their adult income.
To solve a problem of that magnitude, the private and public sectors must be willing to make long-term investments in early childhood development.
Thankfully, there is growing worldwide recognition of how important early childhood is. Organizations such as the World Bank and the U.S. Federal Reserve Bank have formally endorsed early childhood as a key economic priority. The United Nations’ Sustainable Development Goals recognize the importance of early childhood in addressing that challenge, with three Goals having specific Targets relating to early childhood - in hunger, health and particularly education, where Target 4.2 calls for early education for all.
I attended an event last year that speaks to this recognition by the business community: ReadyNation’s 2015 Global Business Summit on Early Childhood Investment. The event included more than 200 attendees representing 15 countries and over 100 different companies or business groups, all concerned with expanding support for young children at the community, state, national, and international level.
ReadyNation is a membership group of more than 1,600 business leaders worldwide who are dedicated to advancing policies and actions that strengthen the workforce by improving outcomes for children. John Pepper, the former Chairman and CEO of Procter & Gamble, is also the co-chair of ReadyNation’s CEO Task Force on Early Childhood, of which I am a member. He calls investments in early childhood “the social, moral and economic imperative of our time.”
The 2017 World Economic Forum in Davos will provide another example of business leaders understanding how important early childhood is to countries’ future success. There will be opportunities for the international business community to learn about this issue and what they can do. I would encourage everyone in the business community to engage in the discussion at WEF Live, and to join me as a member of ReadyNation.
Tackling the problem of economic development through proven investments in children is not only the right thing to do – it’s the smart thing to do.