Leveraging ESG for DEIA Results: Many Believe DEIA is Valuable But Have Not Invested Sufficient Resources
“The secret of change is to focus all your energy not on fighting the old but on building the new.” - Socrates
People are looking for a sense of belonging and corporate responsibility, and shareholders want to see an organization’s commitment to the same. A recent Culture Amp report shows that while many companies believe diversity, equity, inclusion and accessibility (DEIA) are valuable, leadership has not invested adequate resources to create significant change.
Environmental, Social and Governance (ESG) methods inherently involve tracking metrics for reporting and can be leveraged to help organizations better measure, and optimize ESG and DEIA initiatives.
What is ESG?
ESG is an acronym for Environmental, Social and Governance. ESG is best characterized as an analysis framework that helps stakeholders understand how an organization manages risks and opportunities related to environmental, social and governance criteria1. It is essential to note that the precursor to ESG, Corporate Social Responsibility (CSR), takes more of a philanthropic than a measured approach.
Interestingly, ESG is not as commonly known as DEIA. For DEIA practitioners, ESG can be a secret weapon in the fight to move DEIA initiatives and metrics forward. ESG can serve as an alternative that lessens the disruption to the status quo. The level of visibility and support ESG receives allows DEIA to receive the attention that it is often lacking. ESG, CSR and DEIA are all crucial to making a company more appealing to candidates, employees, and shareholders. However, ESG is unique as it is designed to look at issues through the lens of business risks, which tends to resonate with senior leaders and the business community.
The ‘S’ in ESG, which focuses on social aspects such as Diversity, Equity and Inclusion, aids in prioritizing DEIA and may benefit a company’s ability to attract and retain top talent. However, leaders must go beyond the aspects of recruiting and retention and incorporate ESG principles into the entire employee experience. Below are tips for ESG and DEIA success:
Top 3 ESG Tips for DEIA success:
1. Communicate ESG efforts with pride - transformation within an organization must be at the top with clear communication to the people within the organization. Leaders must recognize that employees are at the core of the relationships that will make ESG successful. Multiple studies show that employees prefer to work for purpose-led companies. So, clarify the ESG priorities your organization is committed to and exactly how employees can play a role.
2. Bake ESG into the organizational DNA - It is essential to ensure that employees understand how ESG benefits customers, communities, and the overall brand. Are employees aware of the ESG efforts? Or are ESG efforts only shared with a select few? Employees should understand exactly how an ESG strategy affects their day-to-day roles. This practice adds to inclusivity and overall employee engagement.
3. Focus on culture change instead of compliance - ESG will not be successful if it is seen as simply a required certification or oversight. Integrate ESG into the organization’s culture by tying it to values. Such values as respect, community, and integrity align nicely with climate control, health and safety, DEIA, and other ESG indicators.
Companies with solid ESG strategies have developed resilience during these turbulent times. Embedding ESG into an organization’s culture and purpose can prepare the organization for significant social shifts and rally employees to embrace personal responsibility for company goals that impact climate change, race relations and overall consumption.
Leaders can use ESG to garner and foster more profound levels of support for DEIA in hopes of seeing significant changes in our workplaces.
Fully embedding ESG into purpose, culture and ways of working can prepare people for future disruptive events such as pandemics, fiscal crises, or significant social shifts. It also rallies people to conscientiously embrace personal responsibility for high-impact areas such as climate change, race relations and responsible consumption of our world’s resources.