Antonia Blackwell: How ESG is changing the future of employee benefits

Environmental, social and governance (ESG) considerations underpin the decisions and behaviour of a business. Employees want to see ESG in action and employers will need to take steps to address ESG if they want to attract and retain the best talent in the future.

The way businesses operate in practice has a huge impact on their ESG footprint and therefore working practices will need to adapt to become more sustainable.

The rise in flexible/hybrid working goes some way to help reduce the daily commute and many organisations are looking to reduce business travel, but these measures won’t be enough on their own.

Will we see employers contributing to the cost of solar panels on an employee’s home, for instance? There is a growing drive towards ‘green incentives’ such as cycle-to-work, e-vehicle schemes and workplace charging points for e-vehicles, and such benefits will only increase in popularity.

Employers also need to consider how they source tools and resources for their employees; how uniforms are made and with what materials will be important aspects of any sustainability strategy.

The need for new and diverse skill sets as we move away from traditional carbon-intensive industries will inevitably result in a more diverse workforce.

Businesses will need to establish a culture in which all staff feel included and valued, and look beyond traditional areas for recruitment to develop a broader outreach, supporting young people from different walks of life to develop skills.

The obligations on an organisation to demonstrate its credentials in this space will only increase. Mandatory ethnicity pay gap reporting is on the horizon and it would not take a great leap for other forms of data collection to be brought in, be that disability pay gap or social mobility reporting.

Alongside this will be the need to support employees to perform not just at work but in the world generally.

We are already seeing support in the form of mental health training and resilience workshops being provided by employers and the focus on this area will grow, particularly as the impact of changing workplaces is felt.

Antonia Blackwell is professional support lawyer at Shoosmiths