ESG: Not just a fad but a necessity
More than just a buzzword, Environmental, Social, and Governance (ESG) criteria have emerged as a crucial benchmark for future-ready companies. In a 2020 report by Harvard Business Review, companies with strong ESG credentials demonstrated resilience in the face of crises and outperformed their counterparts. With ESG integration becoming more important for long-term strategic planning, its influence on recruitment, job descriptions, and KPIs is a crucial topic for businesses today.
Integrating ESG into Job Descriptions
A study by Accenture in 2021 found that organisations that align their strategy, purpose, and ambition with ESG targets attract and retain high-quality talent. Thus, embedding ESG into job descriptions is a forward-thinking move that can drive both performance and ethical standards.
When drafting job descriptions, companies should ensure that roles explicitly consider the impact on ESG factors. For example, a product manager’s role might include “ensuring our products are designed with sustainability in mind,” or a procurement specialist might be responsible for “sourcing from suppliers who uphold labour and human rights standards.”
The job descriptions should reflect the company’s commitment to ESG, encouraging potential hires to consider not only their job role but also their role in driving sustainable and ethical business practices. McKinsey’s research corroborates that employees increasingly seek workplaces that reflect their values, underlining the need for integrating ESG in job descriptions.
ESG KPIs: A Roadmap for Sustainable Success
Let me give you some examples of how to define and include ESG KPIs for different roles, specifically Sales Managers, Marketing Managers, and Operations Managers.
a. Sales Managers
Sales Managers are in the unique position of directly influencing revenues and building relationships with clients. ESG-related KPIs can be two-fold:
ESG-Integrated Sales Revenue: Determine the percentage of total sales revenue driven by products or services with a distinct ESG value proposition. This encourages the sales team to promote sustainable offerings and generate value from them.
Client ESG Education: Measure the number of client meetings where ESG goals and offerings were actively discussed. This fosters the idea that sales teams are not only revenue drivers but also ESG advocates.
b. Marketing Managers
Marketing managers are the custodians of a company’s brand image. It is vital for them to project an authentic commitment to ESG. Their KPIs can include:
ESG Campaign Success Rate: Analyse the effectiveness of ESG-focused marketing campaigns, measured by metrics like engagement rate, reach, or conversion rate.
Stakeholder Engagement in ESG Initiatives: Track the number of ESG-themed events organised and the stakeholder participation in these events. This could also include measuring audience growth on ESG-dedicated social media channels.
c. Operations Managers
Operations managers play a pivotal role in minimising the environmental footprint and ensuring ethical practices across the value chain. Their ESG KPIs can include:
Reduction in CO2 Emissions: Set a target for reducing carbon emissions linked to operations, and track progress towards this goal.
Supply Chain Traceability: Monitor the percentage of suppliers compliant with the company’s ESG standards. This encourages supply chain transparency and ethical sourcing.
ESG integration in business practices is not just about compliance, it is about creating a competitive edge. By including ESG in job descriptions and defining role-specific ESG KPIs, organisations can foster a culture that values sustainable growth and ethical business practices. This helps in driving innovation, building brand reputation, and attracting top-tier talent committed to making a real-world impact.
Additionally, it’s important to regularly review these ESG KPIs and adjust them according to the changing landscape. The World Economic Forum suggests that a proactive approach to ESG is an effective risk management tool, anticipating potential issues before they become real problems.
From a strategic perspective, incorporating ESG into every role underscores a holistic approach. Deloitte’s 2022 Global Human Capital Trends report emphasises that ESG should not be an isolated function, but an integral part of a company’s DNA, ingrained in every business process and role.
The goal is not merely to be an organisation that does well, but one that does good. It’s about driving profits while making a positive impact on the world. As Board Members and Executive Leaders, the onus is on us to lead the change we wish to see and build businesses that are sustainable, resilient, and responsible.
The transformation towards sustainable practices is a journey. Each step, no matter how small, moves us closer to our goals. As we strive for a more sustainable and equitable world, let us ensure that our employees – the pillars of our organisations – are empowered, aligned, and motivated towards these goals too.
Together, we all can make a difference, demonstrating that responsible business is good business.
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Founder and CEO
Greg Weiss is known as one of Australia's most experienced recruitment experts and HR consulting professionals. Greg founded Impactful People helping to create a better world, one placement at a time.
Greg has helped 100s of businesses with their people needs and coached over 1,200 people improve their careers through Soulidify and Career365.
If your business employees Gen Z and Millennials, then you need to demonstrate your commitment to how you positively impact on the world. You do that by living through ESG values. If you want to demonstrate real commitment to ESG through recruiting people who can strengthen that capability, then Greg can show you how.