In a piece first published in International Employment Lawyer, Totum Director Deborah Gray discusses the importance of law firms getting ESG right by developing a sustainability policy if they want to attract and retain talent.

The tide of pressure on businesses to prioritise environmental, social,
and governance (ESG) principles is growing. Partners, investors, and clients
are all placing a premium on sustainability values and now so too are
employees.

Not only are growing numbers of potential employees evaluating
prospective employers based on their environmental credentials, alongside
typical priorities such as pay, benefits, and culture, they are increasingly
becoming aware of ESG rhetoric without action, which could be deemed as
corporate greenwashing.

In fact, recent research found that 26% of British workers said they
would be willing to take a pay cut in exchange for working at a business that
acts responsibly towards the environment. A further 28% would consider quitting
their current role and transitioning into one which was offered by a more
environmentally responsible company. Put simply, workers are translating their
values into action and the legal profession is no exception.

Employee retention and attraction are vital in order for firms to
survive and thrive, particularly as many workers explore new opportunities in
the wake of lockdowns. So, it is vital firms understand and embrace the values
of a now majority millennial workforce to ensure they are putting
sustainability principles into action and are avoiding the threat of
greenwashing for good.

The rising millennial generation

Ensuring an appreciation of the values of the next generation of both
lawyers and business services professionals is of vital importance in helping
achieve a truly sustainable cultural shift. Employees are now becoming
proactively involved in integrating material ESG outcomes in their own
businesses, driven by the millennial demographic in particular.

Millennials have a reputation for being values-driven in their approach
to money and careers. Indeed, as of 2019, those aged between 23 and 38
accounted for more than one-third of the global
population, making it hard to ignore the population group, which now
accounts for the majority of the UK workforce.

Of the millennial demographic group, 40% have chosen a job because the
company performed better on sustainability. But a commitment to sustainability
is not just about attracting talent, it’s also about retaining it, with 70% of
millennials saying they would stay with a company with a robust sustainability
policy.

Retention: a rising priority

The aftershocks of the pandemic are also making retention even more of a
priority for law firms, particularly when conservative estimates suggest that
turnover can cost employers 33% of an employee’s annual salary. With large
swathes of employees deciding not to change jobs during the pandemic, many
businesses are anticipating a large amount of pent-up turnover as we emerge
from lockdowns. In the UK, 48% of office workers have said they have found a
new role, are actively looking, or will be leaving their job this year.
Furthermore, in our recent snap poll, 63% said they were highly likely to
change jobs in the next six months.

As a result, businesses need to think about the policies that make them
more attractive than others – and sustainability policy is clearly no
different. If firms don’t think about sustainability in the long term, there
may be a large increase in talented individuals moving on or finding somewhere
else that is more sustainably minded.

So, what can firms do to genuinely embrace sustainability?

Embedding ESG into company culture

A common error is for firms to treat ESG as a box-ticking exercise when
instead businesses need to hardwire sustainability and ethics into their
culture and way of being. Having a simple policy around inclusion is no longer
enough – this is about having a set of policies that potential employees know
you believe in.

What really engages employees is when a firm not only talks about
diversity, employee voice, mental health, and wellbeing with passion, but puts
their words into action. A major part of this is making employees part of the
conversation about the firm’s values – for ESG to be truly embedded into
company culture, it has to be based on principles that entire teams feel proud
of.

Taking a transparent and honest approach

Truly embracing sustainability commitments means taking an honest view
of how a firm currently performs and taking stock of where they are right now
as an organisation. For sustainability to be genuinely on the agenda, firms
must be transparent in the work still to be done with clear targets to underpin
pledges of change.

Similarly, firms need not try to do everything ESG, but should focus on
the elements which align with the business ethos and can truly be delivered.
Again, this will help encourage an environment of genuine understanding and
sustainability rather than an inauthentic approach that risks being categorised
as greenwashing.

Overall, it is clear that with such a large millennial workforce and with other demographic groups becoming increasingly sustainably-minded, companies are going to have to listen to the demands of employees when it comes to ESG. Firms must take stock and set genuine and honest goals for ESG commitments to avoid the rising tide of greenwashing or risk current and potential employees voting with their feet.

Click here to view the article as it appeared in the International Employment Lawyer.

If you have any questions, or would like to know more about how Totum supports firms and candidates in the legal sector, contact Deborah.Gray@TotumPartners.com

 

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