By Daniel Sutherland, Financial Services Practice Director, Grayce
The cries from world leaders demanding a complete overhaul of how we conduct business have never been louder. Key issues ranging from social injustice to environmental sustainability have continued to hold our attention, with the pandemic injecting these issues with an added sense of urgency. Naturally, the reaction from governments around the world has been to commit themselves to reduce carbon emissions. Countries like the UK, France, Denmark, Spain, Hungary and Luxemburg have already announced their goal to be ‘net-zero’ by 2050.
In the wake of COP26, every industry has been under review for how it contributes to climate change, and by 2023, most big UK firms will have to set out detailed public plans for moving to a low-carbon future. The financial services sector is no different, but leaders in the industry have a huge opportunity to drive significant cross-sector change. Financial services firms underpin the infrastructure of other industries by financing them. Therefore a more purpose-driven, sustainable financial services sector can create more sustainable practices in other verticals, such as manufacturing, construction, transport, agriculture and energy.
There are three core areas of focus for financial services corporations that want to have a greater impact on the world. Firstly, they must look at their own operations to make them as sustainable as possible, including reviewing suppliers they work with. Secondly, they should create a robust CSR policy that is adhered to and communicated, both internally to the workforce and externally to customers, suppliers and the wider market. Thirdly, they should work towards creating a more diverse workforce through social mobility and an inclusive company culture that prioritises employee wellbeing. In this piece, I will focus on the third strand – how employers in the sector can drive more impactful change through talent attraction and retention.
Drawing in Gen Z talent to lead by example
Looking at the current financial services workforce, we see older millennials reaching the C-suite, sitting within senior leadership positions with deep knowledge of the sector. At the other end of the scale, Gen Z workers are stepping onto the career ladder, many of whom are passionate about protecting the planet and making their mark in the workplace. Together, these individuals are a powerful, transformative combination that can drive real change.
Not only did the pandemic bring the causes we care about into sharp focus, but it also helped individuals get more clarity on their own professional goals. The latest Workmonitor survey from Randstad found that “the concerns and inconveniences [workers have] weathered have profoundly altered their perspectives and desires. Taking charge of their destiny… has become the defining characteristic for the post-pandemic workforce”. Nearly half (42%) of 25–34-year-olds now cite having meaningful work as the most important consideration in making their career choice and over a third (35%) want to work for respected and caring employers. That’s a colossal number of individuals who are hungry for more purpose-driven roles. By hiring these eager young minds now and forming inter-generational collaborations within teams, financial services leaders can be the driving force behind pushing more sustainable initiatives in business.
Promoting sustainable practices
Gen Z workers no longer have to compromise between corporate roles and sustainability-focused careers, and there are plenty of opportunities for those who want to take action now. We are seeing huge demand from our own clients for talent with a passion for sustainability, who want to go into ESG-focussed projects, and competition for these individuals is tough. Just as investors are now looking more closely at their investments to make sure they align with the impact they want to have on the world, young people are looking more closely at the pledges that financial services organisations are making to check that they align with their own interests and career goals. Historically, ESG might have been viewed as a nice-to-have, but it’s now a business imperative for those who want to attract the brightest talent. Gen Z is hungry to be part of the change, but they’ve got to see a commitment from their prospective employers first. To stand any chance of attracting the best, most passionate minds to their teams, financial services organisations must demonstrate their commitment to ESG-focussed programmes and roles. If they don’t shout about their efforts, they won’t draw in the young talent they need to make a difference.
Putting our faith in Gen Z and creating a workplace environment responsive to their opinions provides financial services firms with a major opportunity to accelerate sustainability initiatives within their own businesses and inspire businesses in other industries to do the same.
Indeed, attracting the ‘right’ talent is only one part that makes up a larger aggregate of wider issues. However, if business leaders are serious about becoming more sustainable, it is something they must consider adapting to their organisations. It is no surprise that financial services firms with higher ESG ratings typically perform better financially and have a higher market value, as it is indicative of high investor and consumer confidence. As such, prioritising green initiatives within financial services firms enables business leaders to be confident in the fact that they are carrying out changes that will have a long-lasting impact on the future generations to come.