These are unprecedented times in recruitment. Job vacancies have reached record highs, and competition for talent is intense. And yet, too many companies across the property sector are failing to fully recognise major factors in retaining and attracting top talent.
This generation of workers, for the first-time majority millennial, are placing a premium on ESG principles in the workplace.
To many, ESG is simply about focusing on the environment – companies minimising the impact their activities have on the planet, while the “S” and “G” get lost in discussions about reducing carbon emissions and reaching net zero.
But the social and governance aspects of ESG are just as important, compelling companies to consider people, relationships and how the firm is run and structured. For proactive businesses, these offer real opportunities to foster a culture of diversity and inclusion, embracing talent regardless of gender, colour or background.
Substance over looks
The property industry has long been considered a persistently “male-dominated industry”, and across the real estate sector, just 30% of senior leadership positions are filled by women.
In fact, issues that we might have assumed to be in the past, like how companies deal with key client relationships during maternity leave, are still prevalent.
Worse, too many companies still see diversity and inclusion as HR issues rather than ones critical to the business’s long-term success.
Repeated studies have shown that companies with higher numbers of women in senior leadership positions perform better. According to Boston Consulting Group, more diverse management teams deliver 19% higher revenues. Clearly, prioritising the social and governance elements of ESG has financial benefits as well as being the right thing to do.
For property firms, this is a chance to re-evaluate their hiring practices and work with experienced partners who understand how to put diversity at the heart of their approach and, in turn, support meaningful growth.
It is also an opportunity for the sector to be a positive role model. Recruiting a diverse workforce, in both gender, race and other minorities, helps younger workers and those yet to enter the job market understand what workplace equality should look like.
More diverse representation will also help workers feel better accepted and therefore more confident in entering different sectors. For example, hiring more women into senior leadership roles can positively influence younger female workers, helping them aspire to similar roles in the future.
The impact of diverse workplace representation is far beyond simply placing one person in a role. It has a lasting effect, empowering those previously marginalised and demonstrating a clear commitment to creating a better future – something the next generation of workers are keen to be a part of.
A recent study by Deloitte looking at attitudes of young people found clear evidence of how they are positively seeking out brands and organisations where there is accountability, how vocal young people are about issues of diversity and inclusion and how they will turn their backs on companies and employers whose actions conflict with their values.
So, for companies that fail to instil clear policies on creating a diverse and inclusive workforce, not only is there a real risk of missing out on talent, but they also run the risk of alienating the workforce of tomorrow by ignoring their values.
Don’t forget the ’S’ in ESG
ESG is on our collective agenda. We saw that in October when the world came together in Glasgow for the COP26 summit. But the environment is just one aspect of ESG.
The equal participation of women in leadership in business and politics is essential. Not just because it is the right thing to do but because failure to achieve it will mean the world will fail to achieve the Sustainable Development Goals by 2030.
Where politicians failed to deliver the environmental commitments needed at COP26, businesses have a golden opportunity to advance social and governance issues, future-proofing their strategies for long-term, sustainable growth.
But achieving diversity must not simply become a process of ticking boxes. Longstanding pledges to enhance diversity and inclusion within the real estate sector must now be turned into concrete actions. Failure to do so will be seen as the industry greenwashing its failure.
If genuine progress is to be made, it is crucial that companies commit to taking fundamental steps towards improving diversity in all its forms, improving transparency accountability and tackling discrimination wherever it arises.
The real estate sector has taken great steps towards addressing environmental issues reducing carbon emissions and other pollution which can be harmful to the planet. But now it’s time to get serious about ESG in the round. Companies that demonstrate a clear commitment to diversity and inclusion will not only put themselves one step ahead of the competition in the current war for talent, but they will also open the door to future employees too.
Deborah Gray is Founding Director at Totum Partners.