Less than a tenth (8%) of businesses have a fully realised environmental, social and governance (ESG) strategy, despite nearly four in five organisations accepting that ESG factors impact their brand or reputation – a new report by The Open University has found. Published today, it explores business leaders’ attitudes and knowledge of ESG and barriers to adopting ESG, such as existing skills gaps within their organisations.
Surveying over 500 UK businesses, the report highlights that this disconnect between awareness and action is due to blockers such as a lack of financial resources (28%), missing essential skills (24%), and complexity (23%).
The report sheds light on the ESG skills gap as more than four-fifths (80%) of businesses who engage in ESG accept they lack the right skills in each of the three ESG pillars. The skills gap has been exacerbated by inflation and rising business costs which has put pressure on learning and development budgets. UK business leaders agree that ESG is a priority, but they are struggling to put training plans in place to equip employees with the skills required to meet ESG.
Among those who experience skills gaps, the top five skills gaps are in:
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Waste reduction (27%)
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Data analysis (25%)
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Energy tracking/usage (24%)
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Training & development (24%)
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Carbon accounting (23%)
In light of these challenges, the report aims to aid businesses on their ESG journeys and details how organisations can bridge the existing skills gap. The report, which includes insights and advice from ESG experts, encourages business leaders to educate themselves and their staff, measure their goals and use their voice to speak up in order to successfully implement ESG strategies within their businesses.
Dr Victoria Hands, Director of Sustainability at The Open University, commented:
“Businesses now understand more than ever, that ESG performance is critical not only for the reputation of a modern organisation, but also for success and profitability. These topics are now central to driving future success and investment to transform our society.
“This report reveals that ESG conversations are happening frequently in all sizes of businesses, which is really encouraging. Whilst conversations are taking place, it’s crucial that strategies are put in place to help employers develop ESG-related skills and ultimately work towards future-proofing businesses, their workforces and the communities they serve.
“In upskilling for ESG, we have the opportunity to ensure that such a transition is equitable and inclusive of the diversity of people in our society. To help work towards sustainable goals, employers should explore developing long-term strategies through education, data measurement and the confidence to use a business’s platform to speak up.”
Jane Grant, Depute Director External Engagement and Partnerships at The Open University in Scotland, added:
“The report reveals that the lack of skills is the second biggest blocker for adapting ESG, but the right employee training can be a solution to this gap.
“It’s important that employers are aware of their options and invest in appropriate training programmes through partnering with an organisation such as the OU, to help them keep on track with achieving ESG objectives. We have successfully supported a large number of businesses – who can choose from different approaches including microcredentials, continuing professional development courses, degree apprenticeships, undergraduate and postgraduate qualifications, free learning from our OpenLearn platform, or newly created tailored opportunities.
“For example, with our partner Scottish Water we have developed a new Combined STEM degree offering their employees both innovative and practically relevant knowledge to address the organisation’s strategic objectives. As part of our partnership with The National Trust for Scotland we did a bespoke mapping exercise of OU provision against the organisation’s job families and key skills, resulting in a tailored selection of courses to support staff in their careers.”
Craig Jackson, Senior People Consultant at Scottish Water, said:
“Scottish Water is committed to future-proofing our workforce and engaging with younger generations, with a core aim of encouraging young people to think about STEM and its links to the water industry. The Partnership with The Open University has been invaluable in this. Through learning core theory, our students are able to unpack the societal, political and environmental impacts of digital technology that are needed to increase the rate of change required to meet Scottish Water’s Net Zero targets.”
To find out more and download the report ‘Educate, Measure, Speak up: How businesses can get ahead with ESG’ visit: https://www5.open.ac.uk/business/esg
