08 Oct 2019
Attracting APAC talent the sustainable way
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Since our first report on the key relationship between sustainability and talent in 2017, what exactly has changed?
In late 2017, Odgers Berndtson published ‘People, Planet and Profits: How Sustainability Boosts Performance and Attracts Talent’.
We interviewed 40 APAC leaders of multi-national corporations to understand their sustainability practices, insights, and attitudes. We wanted to find out if there is a clear impact on business results.
Three themes emerged from our research:
- The business case for sustainability is a good one. The data shows that the financial bottom line is better in companies with sustainable practices.
- It’s not just a Western thing. There is huge relevance in Asia.
- Returns are directly linked to employee engagement.
Today, employees look for meaning in their career. Sustainable practices have a real impact on engagement. It attracts talent.
What has changed?
Since our report, there has been some progress, but not as much as we would like. Companies and leaders in Asia are taking more initiatives to make sustainability a bigger part of their corporate strategy and a more important part of their corporate lexicon. But there’s still work to do.
Although sustainability is higher up the agenda in the Western world, Asian countries are catching up. The Global 100, a list of the top 100 most sustainable companies, compiled by Corporate Knights, shows that two Asian companies make it into the top 10: Shinhan Financial Group (South Korea) and Taiwan Semiconductor. Five others are in the top 40, and 17 in the top 100.
APAC sustainability measures
From speaking to APAC regional executives, it is clear that not every country (and company) is ready to make critical financial or strategic investments in sustainable products and manufacturing. As the marketability for sustainable products varies per market, the desire to focus on sustainability varies too. A regional APAC executive with a US industrial firm stated: “If your customers in Asia are not willing to pay extra for sustainable products, why produce them in the first place?”
The head of a regional organization focused on increasing sustainability awareness disputed some of these comments.
“APAC governments have an increasingly stronger understanding” of sustainability. Some local stock exchanges are making it mandatory for listed companies to report their sustainability.”
He cited Temasek HQ’ed in Singapore, which has a full department focused on sustainability. Temasek’s Chairman, Lim Boon Heng, said recently: “Our investment focus is driven by structural trends in transformational technologies, sustainable living, longer lifespans and changing consumption patterns.”
Driven by a sustainability purpose
DBS, the former Development Bank of Singapore, says that being purpose-driven “has always been part of our DNA. As a member of the United Nations Global Compact, we are committed to driving progress towards achieving the Sustainable Development Goals (SDGs). We believe that we have a role to play in promoting sustainable development. We have chosen to focus on six SDGs which we believe we can make meaningful contributions to, and after taking into account the markets we operate in.”
Giant agri-business Olam is unequivocal about its sustainability position.
“Sustainability is at the heart of our business, not just because it is the right thing to do, but because there are clear business benefits.”
Other APAC companies such as Ayala in the Philippines and CP Group in Thailand are local sustainability “champions” in their countries. Other local companies will join the cause if clear business benefits can be shown. This is particularly true for companies looking to export to Europe where sustainability requirements make it necessary to sell there.
The connection between sustainability and talent
So where does talent fit into this picture? It is not just millennials who focus on the Employee Value Proposition (EVP). Increasingly, employees from all generations do too. In the words of a regional APAC president based in Singapore: “Without our sustainability efforts, we would not be able to hire half the quality of employees we current attract, junior or senior.”
On the other hand, one global executive pointed out that salary is still the most important aspect for potential candidates in Asia for his company: “We might be making strong efforts in sustainability, but still have to back this up with good salary and benefits, otherwise candidates won’t join.”
But once those criteria are met, the message is clear. Without real progress on sustainability, it will become increasingly difficult for companies to hire the right talent in the APAC region.