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When my Grandpa Alan returned from fighting on the Western Front in World War II, the job at Campbell Soup Company was perfectly fit for purpose — solid pay, good benefits and local. So, he worked there for 30 years.
"Purpose" in the workplace was transactional then: Make a great soup, sell it, get remunerated. Repeat. It’s unlikely that 71 percent of Alan’s contemporaries would take a pay cut to do "meaningful" work, or that the same percentage would be willing to leave a job if they felt a clash between their personal values and their employer’s — but, dear reader, the current crop of your prospective employees would.
Employees’ expectation of an authentic, transparent and data-driven commitment to tackling the climate crisis is here to stay.
I’m not talking about the ranks of NGO-bound workers leaving elite universities in search of do-good work. McKinsey & Company, the white-shoe consulting firm known as a place to cut one’s teeth and make loads of money post-MBA, is feeling the pressure from its employees to take the climate crisis seriously. The human resource losses the firm is experiencing are nontrivial, both for talent attraction and retention but also for reputational integrity.
Or consider Grandpa Alan’s old employer. Campbell’s top prospects in 2022 want to learn how the company is "connecting people through food they love" and how the product "helps create a healthier, more sustainable environment" before they sign on. Less so about why it’s "M’m! M’m! Good!"
All of which has significant implications for today’s white-hot world of ESG.
Edelman’s 2021 Trust Barometer found that after years of rebuilding, the financial services sectors suffered a steep loss in trust. While business as a wider category has experienced an uptick in trust, Edelman found, financial services has not, with the asset management and digital wealth management subsectors taking the biggest hit.
The war for ESG talent is still being waged and doesn’t look likely to let up anytime soon. Gen Z and Millenials make up nearly half of the full-time workforce in the United States and elsewhere. Assuming the Great Resignation is followed by a Great Application, how is this massive talent pool gauging your firm’s ESG credentials?
Beyond blah blah blah
If you read BlackRock CEO Larry Fink’s 2022 letter to CEOs, tellingly titled "The Power of Capitalism," you may have gotten the sense that the dominant economic system — not to mention the world’s largest asset manager with a huge stake in that system — is playing defense.
"We focus on sustainability not because we're environmentalists, but because we are capitalists and fiduciaries to our clients," Fink wrote.
Sustainability is an existential necessity if the finance world is to sustain itself with a robust talent pipeline. More than half (54 percent) of Gen Z reported that they have a negative view of capitalism. And lest you think this is solely the sentiment of progressive elites, even young Republicans’ historically positive view of capitalism dropped 15 percentage points in the last three years.
There are many ways to explain this decline in faith in a system where commerce is controlled by private owners for profit rather than the state, but "blah blah blah" captures it well. When it comes to doing the right thing for people and the planet, companies have talked and talked but failed to walk that talk.
"Blah blah blah" is not just a Gen Z construct to capture the empty promises of corporate and political commitments. Before Shell CEO Ben van Beurden had the chance to begin blah-ing onstage at the TED Countdown conference in October, Lauren MacDonald, a Scottish climate justice activist, minced no words letting the oil exec know how she and so much of her generation feel.
"I just want to start by saying that you should be absolutely ashamed of yourself for the devastation that you have caused to communities all over the world," she said to van Beurden. "You are responsible for so much death and suffering."
While the plural of anecdote is not data, I’ve had enough conversations with talented new job seekers in the ESG space to get a sense that MacDonald speaks for more than just herself and other activists.
I’m a mentor to Oxford University master’s students in the program I graduated from several years ago, focused on the intersection of sustainability and enterprise. Their assessments of a "good" firm to work for tends to be discussed in similar terms.
As an Oxford mentee shared with me, "I’m certainly not going to be the one employed to propagate misinformation on money managers’ behalf while the world literally dies." When I asked how he intended to make certain that he wasn’t going to find himself doing so, he told me he was well-prepared to interview his interviewer. "Why would I believe what’s on their own website?"
Or, as energy sage Amory Lovins likes to say: "In God we trust. All others bring data."
It may be clear already, but as an employer seeking top talent you’ll need to have some pretty good stories and concomitant data points to demonstrate your firm’s ESG commitment. Pledges and promises are so 2021.
Companies seek out customers’ — and future employees’ — attention where they spend their time, and social media is the principal domain of digital natives. But telling your story via social media alone isn’t enough — the TikToks, Facebooks and Instagrams — despite the fact that Gen Z spends about 4.5 hours in that world every single day. But what about out there in the real world?
I spoke on one of Andrew Revkin’s Sustain What webcasts last week and an undergrad Columbia University student in the audience asked, "Do you know of any venues where we can speak openly with these finance firms about what they’re doing in ESG, like a real conversation?" I came up woefully short on an answer (although I’m hoping our GreenFin 22 conference in June will be one place where "real conversations" happen).
Pledges, promises and other forward-looking statements about a firm’s purported progress are losing caché. This is especially the case in a market where the interviewee is in a relatively strong position to play interviewer — that is, to grill you to see if you’re worthy of their work. Even more so in the world of finance, which hasn’t exactly proven to be egalitarian in a world of growing inequality.
As the UN Secretary-General recently put it, "The global financial system is morally bankrupt."
The key question, then, may be whether job applicants actually trust you and your company. Stephen Covey, the guy who taught many of us how to be highly effective people, described trust as "the glue of life … the most essential ingredient in effective communication."
So, if you want to gain trust and show your firm is authentically committed to ESG priorities, make yourself open to candid dialogue with potential employees about what they want to see from you, even if it’s uncomfortable to do so. To differentiate from competition that may be more sanitized or tight-lipped (and, therefore, less trustworthy), consider dedicating some time from your growing ESG team to do no-holds-barred Q&A’s with prospective employees.
For a generation of rising talent ostensibly more swayed by a firm’s beneficial impact than by an obscene bonus, having open dialogue can be tough but it will serve you in the long term. Employees’ expectation of an authentic, transparent and data-driven commitment to tackling the climate crisis is here to stay.