One in Five Workers Would Reject a Job Offer if ESG Values Don’t Align | How to Create a Sustainable Workplace

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It’s no secret that paying employees appropriately, i.e., what their skills, experience and time are worth, is key in retaining them. However, lower pay is not the only thing driving employees, especially Gen Z employees, away from work. There are many factors such as flexibility with work, work-life balance and their relationship with other co-workers that also play a vital role in employee retention.

Another factor that many employees, especially Gen Z, are fixated on is sustainability. The level at which an organisation values creating a sustainable world is important to employees, so much so, that many of them aren’t interested in joining a company if the company cannot demonstrate their commitment to the environment.

Employees are Ready to Accept Lower Salaries

According to a recent survey by Bupa, many employees are willing to accept lower salaries and even a pay cut, if they can work for a company that is ethical and environmentally friendly. About 42% of workers would accept lower pay to work for an ethical or environmentally active organization. Among the younger generation (Gen Z), this number rises to 66%. Additionally, 42% of respondents said that their mental health is negatively affected when their employer doesn’t take action on social or environmental issues, up from 33% in 2021.

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More than half of Gen Z employees (56%) said that presenting sustainable and eco-friendly initiatives to their leaders and seeing them implemented would increase their motivation at work and drive productivity, loyalty, and talent retention. They prefer working with eco-friendly start-ups and innovators instead of following established practices.

One in Five People Will Reject Job Offers

In January 2023, KPMG UK released data from a survey where they asked 6,000 adults in the UK who graduated from work in the last six months about their thoughts on work. The results showed that almost half of the respondents (46%) want their employer to show a commitment to ESG (Environmental, Social, and Governance) principles. Additionally, one in five people (20%) have rejected a job offer because the company did not align with their values regarding ESG.

The age group most interested in ESG commitments from their employer is between 25-34 years old, with 55% of them valuing it. However, 51% of 18-24-year-olds and 48% of 35-44-year-olds also consider it important. When it comes to searching for a new job, 20% of respondents said they declined an offer because the company’s ESG commitments didn’t match their values. Among 18-24-year-olds, this number increases to one in three.

How to Become More Sustainable for Better Employee Retention

Sustainability initiatives can mean different things to different people, while the end goal remains the same. While there are many ways to be more sustainable and also create an attractive work environment for new employees, research shows that employees want to have a say in sustainability efforts and see concrete actions being taken to achieve net-zero targets.

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Hence, the best thing would be to open the space for transparent conversation with employees and see what they have to say. In addition, here are a few more things managers and decision-makers can incorporate at work:

  • Encourage employees to commute by bicycle. There are plenty of government schemes that allow employees to purchase bikes through a salary sacrifice arrangement, resulting in significant tax savings.
  • Provide opportunities for employees to make a positive impact through corporate social responsibility (CSR) initiatives such as fundraising and volunteering. Documenting and posting these on social media will also help spread the word about the company’s initiatives, making it more attractive to environmentally conscious workers.
  • Reduce the need to commute by making remote work the standard working model, with occasional office visits if needed, as it can help reduce commuting emissions.  
  • Adopt a “Reduce, Reuse, Recycle” policy at work where employees are encouraged to dispose of trash correctly and conserve energy by unplugging electronics when not in use.

However, just implementing policies and benefit schemes is not enough as they have to be measured for success. A few ways to check the effectiveness of sustainability initiatives are:

  • Engaging with your employees to gather their feedback and understand their preferences regarding sustainable benefits. Organisations can also incorporate anonymous surveys to understand what is working and what can be done more.
  • Monitor employee participation in the sustainable benefits offered, and compare employee retention rates before, during, and after the implementation of the sustainable benefits program. This analysis will help you assess whether the program has had a positive impact on employee retention.

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