Sustainability has become a key part of most organisations' thinking when it comes to long-term strategy. There are several driving factors as to why this is the case: moral, operational, and legal. This does, however, pose a wider question of whether a company acting in a sustainable way will enable higher-quality talent acquisition and retention.
Sustainability has become such a growing issue due to the range of evolving opinions and a wider awareness of the consequences of not acting in a sustainable way. The extreme consequences, of course, are the adverse effects on the climate, whether that be rising sea levels or desertification. In the business context, however, these consequences are prominently witnessed through the lens of employee satisfaction, compliance with government regulations and customer engagement. Intuitively, this inexplicably links talent acquisition and sustainability as the talent that companies now wish to hire and retain will, more likely than not, care about sustainability.
A Growing Sector
According to the World Economic Forum's 2023 Future of Jobs report, jobs in sustainability are on the rise (as shown in the graph below). This is indicative of the changing tide, with sustainability becoming increasingly important to businesses. Those acting now have the ability to set the gold standard of sustainability practices by hiring top talent, which will make it increasingly difficult for those lagging behind to acquire similar expertise.
The fastest-growing roles relative to their size today are driven by technology, digitalisation, and sustainability. Between 2018 and 2022, Sustainability and Environment-related roles were notable for all being in the top 40 of the fastest-growing job postings on LinkedIn. This suggests that the green transition has become embedded within the job market, and with its rise, a further consciousness could lead to even stronger feelings about companies acting sustainably.
Furthermore, the fact that “Sustainability Analyst,” “Sustainability Specialist,” and “Sustainability Manager” are in the top 10 fastest-growing roles highlights the appetite for these positions and suggests that the companies who are presently investing in their sustainability practices will acquire the top talent.
This will require those who are not currently planning a sustainability strategy to provide further incentives to attract top talent.
The WEF Future of Jobs report predicts that the second greatest barrier to business transformation is the inability to attract talent.
This is, in part, driven by the Government mandate of achieving Net Zero by 2050, which marks green jobs as essential to this aim as the private sector has a requirement to reduce its carbon emissions. Employers have increased green job hiring rates, every year since 2019 year-on-year green job growth has exceeded the overall hiring rate growth. This is indicative of a shift in hiring practices and will play a key role in the job market. It also identifies the need to move quickly and implement a sustainability strategy before those with the most relevant experience, innovative ideas, and strategic thinking have found positions.
Another key part of how sustainability strategy will become synonymous with hiring practices is due to the generational shift that is currently occurring in the workforce. Increasingly, Millennials, who will make up 75% of the workforce by 2025, are looking for socially responsible employers, and Bupa found in 2021 that 64% of 18-22-year-olds consider it important for employers to act on environmental issues.
The generational shift in the workforce will require companies to operate sustainably as it becomes more important to the talent they want to attract. Bupa also found that this same demographic will turn down roles and even take pay cuts to work with their preferred employers. It is, therefore, important to ensure that, as an employer, you are acting in an environmentally responsible manner to attract the next crop of top talent. It also suggests that with the interests of the younger generation being predicated on environmental issues that there will be a deepening of sustainability skills within the job market, creating a greater supply of these professionals.
This extends to retaining talent, as 59% of the Bupa survey expressed they would remain longer with socially and environmentally responsible employers. Employees are finding that having an employer that implements their ESG commitments is a key factor in their decision-making when taking a job, but also when remaining in their job.
This generational shift has been evident at Freshminds; 2/3 of the Freshminds Sustainability Team is comprised of Gen Z staff. To work on the team was voluntary and on top of their day-to-day jobs, suggesting a desire to drive Freshminds to act in a more sustainable way. This is supported by a recent Deloitte survey that shows this generation is extremely interested in sustainability issues, with 28% of Gen Z respondents saying that climate change and safeguarding the environment are their greatest concerns.
It is one thing aiming to act in a sustainable way but another thing actually doing so. At a recent Freshminds Business Breakfast, Sky News Economics and Data Editor Ed Conway spoke about the practicalities of the energy transition and achieving net zero. It was a very empowering talk that spoke of the challenges of decarbonisation, which are further outlined in his book Material World: A Substantial Story of Our Past and Future. While difficult, decarbonisation is a worthwhile and necessary venture and much like that principle, implementing a sustainability strategy for your business and acting sustainably is also important. The two processes will be costly, invasive and revolutionary. Your business will act in a different way and will be scrutinised to make better choices. However, this is something to be embraced rather than shied away from, as it improves the operational capability of your business for the future.
With sustainability initiatives, there often comes a ‘Green Premium’, which seems costly; coupling this with a concern that sustainability attitudes, in general, may be softening, and businesses may worry that their sustainability operations will not lead to business growth. Deloitte’s Global Sustainability Survey showed that reticence is not confined to respondents’ willingness to pay a ‘Green Premium’ for sustainable goods and services.
Respondents noted less backing for governmental climate action and lower participation in advocacy activities like attending climate rallies or donating to environmental groups, suggesting that sustainability might not be as big a concern to the workforce as previously thought. Furthermore, fewer respondents reported promoting sustainability in the workplace and fewer would be willing to switch jobs to work at a more sustainable employer. Perhaps, sustainability is not as critical to the workforce or a business’ customers when you take into consideration factors that are currently negatively affecting business performance rather than those that will affect it in the future.
However, BCG contends that being at the forefront of sustainability can unlock new growth opportunities through strengthened market access, greater access to investment and lower capital costs, higher consumer acceptance, new business models, and, crucially, increased appeal to talent. Through greater ESG commitments and actions, you are afforded access to greater opportunity to business growth as you are setting the standard of how businesses should be operating, and will be operating in the future. This is not only important for your customers and clients and, therefore likely to increase revenue, but also paramount for employees and the workforce, which will ultimately improve business operations and top-line growth.
It is evident that sustainability will need to be considered when thinking about talent acquisition. The workforce is now comprised of younger people who think about a wider range of factors when deciding their next job role. Companies will, therefore, have to shift their practices to attract the best talent. The WEF Future of Jobs report predicts that the second greatest barrier to business transformation is the inability to attract talent, and therefore, implementing a sustainability strategy could enable greater business transformation in the coming years.
Freshminds is capable of breaking down this barrier by connecting great businesses to star candidates.
Want to chat? Get in touch with one of our team members and start the conversation.