Helen Barge, Managing Director at Risk Evolves, explains how effective ESG talent retention strategies can give you the edge in a competitive job market.
What’s the ideal way to attract and retain the best people?
Increasing pay might seem obvious, but it’s not the only answer.
A greater commitment to environment, social and governance (ESG) issues is another serious option. As the world changes, people are increasingly sensitive to environmental and social issues and more likely to commit to a company that shares their values. This is especially true for younger members of the workforce.
For our part, as specialists in ESG, we have seen more and more organisations ask us for advice, guidance and practical help.
We know that sustainability is not just about global issues such as climate change, poverty, hunger, clean water and sanitation. It is also about considering your business’s impact on your local community, and how your operations and the growth of your business will affect the lives of others now and in the future.
There’s no doubt that your company’s approach to ESG can help you attract and retain top quality people. Developing robust ESG talent retention strategies has become crucial for modern businesses.
ESG – a reminder
While there’s a great deal of talk around ESG it’s not always clear what it means. As a reminder:
- ‘Environment’ focuses on a company’s attitude and actions toward the natural world
- ‘Social’ considers how a company manages relationships with employees, suppliers, customers and the communities where it operates
- ‘Governance’ relates to company leadership, executive pay, audits, internal controls and shareholder rights.
In the eyes of existing and potential employees, if you prioritise ESG your commitment goes beyond profit-seeking and shareholder value. Rather, you are also committed to people, the planet, and the principles of good governance.
Among other benefits, being serious about ESG helps improve employee engagement by showing people that the work they do has a positive impact. And engaged employees are likely to stay with you.
By adopting ethical and sustainable practices, such as reducing carbon emissions, using recycled materials, or ensuring pay equity, you show employees that yours is a responsible, trustworthy company.
Achieve ‘B Corp’ status
At Risk Evolves our commitment to ESG includes being B Corp certified. This designation, which any business can apply for, shows we meet high standards of verified performance, accountability and transparency on factors from employee benefits and charitable giving to supply chain practices and input materials. To achieve certification, a company must:
- Demonstrate high social and environmental performance by achieving a B Impact Assessment score of 80 or above and passing B Lab’s risk review. Multinational corporations must also meet baseline requirement standards.
- Make a legal commitment by changing their corporate governance structure to be accountable to all stakeholders, not just shareholders, and achieve benefit corporation status if available in their jurisdiction.
- Exhibit transparency by allowing information about their performance measured against B Lab’s standards to be publicly available on their B Corp profile on B Lab’s website.
Take straightforward steps
We know there’s a lot for organisations to do, and it can be difficult to know where to focus your ESG efforts. But there are relatively straightforward steps you can take that will likely appeal to your existing and potential workforce.
Be transparent about your ESG practices. Publish annual reports and encourage open dialogue about sustainable initiatives within the company. At Risk Evolves we publish an annual Impact Report, outlining our strategy, achievements and actions.
Regular reporting on ESG ensures transparency and lets you track your progress and make any necessary adjustments. In addition, when you communicate your efforts to employees, investors and the wider world, it enhances your organisation’s reputation.
It’s important to promote your credentials in areas such as diversity to your people and job applicants. Bear in mind that having a diversity strategy means going further than having equal opportunity and related policies. You must capture diversity data, understand the makeup of your workforce and know if any sections of society are underrepresented.
Remember that sustainable working practices include your approach to work-life balance, the living wage, time off and stable employment (as opposed to zero-hours contracts).
Wellbeing is an important factor in talent retention. When you integrate sustainable wellbeing programmes into your operations, you improve your employees’ quality of life and reduce your ecological footprint.
Environmental considerations include employee health and safety. Organisations with well-developed ESG policies often have better workplace safety protocols that help reduce accidents and improve their people’s health. As well as increasing job satisfaction for your people, this helps boost morale.
Ask your people
Of course, you will likely be carrying out some of these measures already and may already have achieved industry standards, such as ISO 9001. However, if you are thinking about your approach, it’s good to start with a staff survey, allowing your people to identify areas of change.
Embracing ESG is not just about being seen to be a responsible and sustainable employer, it also helps you mitigate risk. Taking action that helps you avoid reputational damage should give you competitive advantage and, if you become known for your ESG approach, it can significantly enhance your firm’s public profile. Conversely, if you ignore ESG issues it can lead to reputational damage and deter prospective employees.
The link between ESG standards and people retention is clear, and they are a must-have in today’s business world. To fully realise its benefits, ESG needs to be integral to your corporate culture. This requires clear communication from your leadership team about its importance and how it translates into your everyday operations.
Understanding and leveraging these standards can help you ensure sustainability and long-term success. Implementing successful ESG talent retention strategies is essential – when you make ESG part and parcel of your firm’s identity, you increase your chances of attracting and retaining top talent.
Our team can help establish and nurture strong ESG policies to future-proof your organisation
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