Young professionals around the world feel they are lacking the right tools, autonomy and empowerment needed from leadership to support their organization’s climate ambitions, according to a recent KPMG International report.
The annual Leaders 2050 report reveals that two thirds (66%) of respondents feel responsible for driving Environmental, Social and Governance (ESG) impact in their organizations, but only 10% feel they have the autonomy or are empowered to act.
The report, which surveyed over 800 young people (aged 18 to 35) across 48 countries, highlights the disconnect between the thoughts, perspectives and experiences of young people and those of senior leaders across both private and public sectors, when it comes to creating and establishing ESG strategies in business. It also emphasizes the value young people are placing on sustainability in their careers, community and personal lives.
A company’s approach to ESG is mentioned in the report as one of the key elements young professionals consider when selecting a career, with almost half (48%) of the respondents stating they would leave a job if their organization didn’t demonstrate a commitment to climate, sustainability and social impact. 63% also agree that they consider a company’s ESG credentials when selecting a potential employer.
Avery Johnstone, global decarbonization hub manager & global chair, Leaders 2050, KPMG International, said:
“As climate change continues to grow in severity and frequency, there is an increased need to mobilize both action and capital. Young professionals stand to inherent the responsibility and capital allocation power needed to reach net zero as they ascend to leadership roles in these next pivotal years.
"They are an untapped resource who understand the wants and needs of their generation with a systems-level approach and understanding of the global economy.”
Communication and transparency of a company’s sustainability strategy plays a pivotal part in building trust and improving a young professional’s engagement in the workforce, according to the findings. Furthermore, over half of the respondents (57%) cite ‘learning and development opportunity’ as a key tool, followed by ‘technology and digital tools’ (43%), and ‘external networking opportunities’ (40%).
On the road to net zero, the younger workforce note cost of decarbonization (29%) as the largest organizational barrier to meeting climate ambitions, closely followed by a lack of will from senior leaders (26%). As it stands, just half (49%) agree that their organizations have fully embedded ESG principals into their business strategies, and the same percentage believe that their ESG impact strategy is ‘middle of the pack’ compared to industry peers.
The report emphasizes that involving the next generation in collaboration and decision-making is not only vital in supporting ESG strategies, but for business survival, stating that if leaders fail to do so, they risk higher employee turnover, loss of staff confidence, lack of credibility and reputational risks.
Avery added: “When selecting a career, young people are prioritizing businesses that align with their values and purpose and are seeking out organizations that are driving forward the ESG agenda. They expect companies to demonstrate that their ESG commitments are being met with responsibility and tangible action.
“They also feel a responsibility to be a part of the conversation around sustainability and help drive the ESG agenda. Restricting ESG disclosures to senior leaders in the business results in a lack of opportunities for young people to integrate their perspectives and ideas into the decision-making process, and ultimately, leads to organizations missing out on meaningful, diverse and innovative perspectives on key sustainability issues.
“Business leaders need to find strategies that nurture their talent and create safe and inclusion spaces for intergenerational dialogue that allows the younger workforce to learn from senior leadership, acknowledges their voices, and empowers their passion. By listening to and understanding the perspectives of young people, leaders can help foster collaboration and drive longer-term solutions that can stand the test of time.”
