About the survey
In late 2021, we ran a pulse survey among our U.S. HR M&A Roundtable participants about their COVID-19 vaccination procedures when looking at a deal. The HR M&A Roundtable is an invitation-only peer networking forum for senior HR M&A practitioners to discuss HR M&A topical issues with other experts. Membership currently comprises approximately 35 large complex multinational organizations, including many of the world’s leading serial acquirers.
With global M&A activity projected to reach historic highs in 2022, there’s pressure on deal makers to achieve meaningful value and avoid derailments. Navigating vaccine and other health policies created by the COVID-19 pandemic can be one such hurdle. We spoke to some of the world’s most acquisitive deal-making companies and serial acquirers to find out how they’re approaching this fast-changing landscape.
The survey found that the majority of U.S. serial acquirers have a vaccine policy for their employees (70%) and contractors and freelancers (63%) (Figure 1).
However, this tells only part of the story. While most serial acquirers have started to review the vaccine requirements of target companies in due diligence (66%), these findings are not yet impacting purchase agreement language — only 20% said they review vaccine policies at acquired companies when finalising a purchase agreement (Figure 2).
Additionally, acquirers do not expect high attrition rates post-close due to their vaccine requirements — more than half expect 0-2% attrition (Figure 3).
The result is that vaccine policy plays a low impact role in acquisitions (Figure 4).
Ultimately, most serial acquirers expect a low (40%) or medium (57%) impact of vaccine requirements on employee morale (Figure 5).
Since running this survey, events haven taken twists and turns, with the Omicron variant emerging as the dominant strain of COVID-19. Countries like the U.K. have removed all mask-wearing and social distancing requirements for the general public, and several U.S. states are following suit, while countries like Austria have introduced nation-wide vaccination mandates.
Most notably in the U.S., the Supreme Court has overturned the Biden administration’s ruling requiring employee vaccination for large government contractors, which for many organizations was the key driver of vaccination policy.
According to Duncan Smithson, senior director of HR M&A with Willis Towers Watson, “Large organizations seem to be split in terms of how best to respond, with some continuing to require employees to be vaccinated and others putting their vaccine mandates on hold. The government mandate gave employers “cover” but now many are left balancing a desire to ensure the health and safety of their workers with the risk of alienating employees or customers opposed to vaccination requirements.”
We’ll be revisiting this survey in the coming months to provide further updates in this rapidly changing environment.