Environment, social, and governance (ESG) is an approach to evaluate and measure your company’s efforts to work on behalf of social goals beyond growing profits for investors. The environmental aspect measures your impact on the natural world. The social component measures your diversity, employee engagement, and community involvement. Finally, governance relates to your diversity, compensation, and labor practices. Rather than simply holding corporations accountable, ESG focuses on how you prioritize, measure, and report these issues.

Investors are looking for ways to use their capital to create a more sustainable world. According to a JP Morgan Asset Management report, US$500 Billion flowed into ESG-integrated funds in 2021, with growth expected in this sector in 2022. Companies that have developed and delivered successful ESG programs are reaping the financial rewards of these investment strategies. As a result, organizations are in a unique position as they focus on values that align with what prospective employees seek, including diversity, equity, and inclusion (DE&I). Your efforts play a part in recruiting and retaining top talent and providing a better employee experience.

Why should HR leaders take an active role in ESG efforts?

HR leaders play a significant role in building their brand and culture. Because HR teams guide and set policies for the workforce, they have the power to develop ESG programs that other departments must implement and follow. Remember, it is not just customers who care so much about your values. In today’s hyper-competitive hiring environment, people are increasingly looking to work for organizations that align with their beliefs. Prospective and current employees agree they want to work for a company with a diverse and socially conscious workforce and environmentally friendly footprint, corroborated in a recent survey conducted by Oracle and Pamela Rucker, CIO Advisor, Instructor for Harvard Professional Development:

  • Nearly 70% of respondents said they would leave their current company to work for one that takes ESG more seriously.
  • 83% said that they would work for companies that acted on ESG.

What are ESG program benefits and challenges HR teams can expect?

The benefits of ESG programs span the entire enterprise. First, you can realize cost savings by reducing reliance on paper, reducing emissions, offering flexible work, and limiting waste. Second, acquiring new employees or investors becomes easier. Finally, when organizations have diverse leadership supported by a solid governance framework, employee morale is better, and retaining top talent is more achievable.

One challenge associated with starting an ESG initiative is knowing where to start. Your HR team can get overwhelmed, resulting in trying to do too much at once or, worse, not doing anything. Companies with successful ESG programs start by developing a framework for each area, prioritizing initiatives, resourcing them, and identifying success metrics.

ESG program leaders also face challenges in reporting progress. Some of the data needed to demonstrate progress is sensitive, confidential, or both. Often, the data lives in multiple systems and formats, making it more challenging and expensive to assemble and report in meaningful ways.

Today, leadership has a clear view of where the company has been and where it should be going with data, visualizations, and actionable insights. It’s an effort that any ambitious company can undertake to create a more equitable world.

Seven Ideas for HR to Consider in an ESG Program

If your HR team is wondering where to begin the ESG journey, here are seven ideas to start. Enlist the help of other senior leaders to develop a solid governance framework, then build programs that demonstrate your organization’s values and positively impact society. Here are some ways to get started:

Environmental

  1. Automate processes by unifying your HR applications in one cloud to reduce the need for paper forms to complete transactions.
  2. Offer hybrid or remote work to cut back on employee commute times and reduce auto emissions.
  3. Provide incentives for employees who use public transportation, rideshare, or non-polluting methods like walking or bicycling to work.

Social

  • Create a required DE&I training curriculum to expand the understanding of how your employees can contribute to a diverse work culture.
  • Add annual paid volunteer days to benefits packages to allow employees the opportunity to give back to their communities.

Governance

  • Develop and communicate hiring practices that align with your ESG initiatives.
  • Analyze compensation data to check for and address equity gaps.

 

How can Quikerp help HR teams deliver an ESG program?

Technology can play an important role in having an ESG program as a key part of your people strategy. With the right software, you can use data to demonstrate commitment, progress, and the positive change your ESG program has on the workforce, environment, and society.

Quikerp has a complete Human Capital Management (HCM) solution to support your organization in driving a successful ESG program. Here are some of the ways we are helping enterprises achieve their sustainability goals:

  1. Quikerp Cloud Human Capital Management: Natively built for the cloud, Quikerp Cloud HCM is a complete solution connecting every human resource process from hire to retire. Organizations can adopt technology including employee experience, Quikerp Recruiting, Workforce Health and Safety, Volunteering, and Digital Assistant for HCM for their ESG programs.
  2. Quikerp Analytics for HCM: A prebuilt cloud-native solution for Oracle Cloud HCM that provides ready-to-use workforce insights to improve decisions related to workforce diversity, employee attrition, compensation, and more. 

Start your ESG program today

Companies are no longer judged solely by their profits but also by their commitment to environmental and social issues. A successful ESG program means considering a company’s place in environmental and social issues and, most importantly, changing for the better. Discover how Quikerp Cloud HCM can help you start today, whether engaging a diverse workforce or measuring your company’s impact.

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