Talk: How skills enable a successful ESG strategy

Environmental, social and governance (ESG) strategy was a key focus at the Chartered Institute of Personnel and Development’s (CIPD) recent Annual Conference and Exhibition. Phil Kenmore, Director - Corporate Development and Partnerships at the OU, spoke at the event with a particular focus on the skills challenges posed by ESG.

ESG action is a priority for many organisations, but they lack the necessary skills to turn aspirations into reality. A survey-based report by The Open University (OU) released in early November, found that a shortage of skills is a major barrier, cited by 24% of the 500-plus business leaders, second only to financial constraints (28%).

The report Educate, Measure, Speak up: How businesses can get ahead with ESG, shows that businesses recognise the importance of ESG – 77% agree that ESG factors impact organisational brand or reputation, with 84% saying their level of engagement with ESG is high or medium – but many have a long way to go on their journey still. Just 8% have a fully realised ESG strategy.

A significant number (23%) are also being held back by the complexity of ESG, with 16% not knowing where to start with their strategy. When the report drilled deeper into the specifics of ESG skills gaps, it found that the biggest skills deficit is in waste reduction (27%), followed by data analysis (25%), energy tracking/usage (24%), training and development (24%), carbon accounting (23%), risk management (21%), business ethics (21%) and governance structures (20%).

Audience polling

As part of the talk, Phil conducted a live poll to see how the survey resonated with the audience.

For example, when asked where the respondents were on their ESG journey, 14% said they hadn’t started yet, 23% were still at the beginning, 27% were working towards a strategy and 32% were making progress on ESG initiatives. Only 5% (even fewer than in the report) had a fully realised ESG strategy.

When asked about skills, 58% of respondents said their business lacked industry-specific ESG knowledge, with 37% reporting a shortage of training and development and 37% a shortage of diversity, equity and inclusion skills. Significant shortages in a range of other relevant skills were also highlighted: carbon accounting skills (32%), business ethics (26%), data analysis (21%).

Our recommendations

Phil shared the report’s three key recommendations for organisations looking to improve their ESG activities, as reflected in the report’s title:

Educate – give leaders and staff the knowledge and skills to tackle ESG.
Measure – data and reporting are the foundation for measuring progress and success.
Speak up – using your organisation’s platform to speak out against injustices in society.

The talk concluded with Phil sharing information on the workforce development the OU offers organisations looking to address skills gaps, the research undertaken across ESG-related themes, and the vital public engagement that the OU facilitates through its BBC partnership and OpenLearn free courses and resources.

ESG Report