Attracting gen Z talent with ESG

How can companies attract the brightest young talent?

Attracting the brightest young talent involves more than just competitive salaries and benefits. It's about aligning with their values and providing a purposeful workplace. Data trends show that the next generation is highly motivated by progressive ESG strategies and the integration of AI tools. 
 
As the future workforce, understanding what this generation values is crucial. This blog will investigate everything you must know to attract and retain talent using ESG strategies and how to implement them. 

The importance of ESG to gen Z 

ESG, which stands for Environmental, Social, and Governance, is a strategic imperative that influences every decision a business makes. It holds organisations accountable for their impact on the environment, society, and internal governance.  
 
Gen Z, on track to be the most educated generation in history (57%), is deeply concerned with societal issues.  
 
They value diversity, inclusion, climate action, and mental health support. This generation seeks purpose in their careers, prioritising a company's mission and values. Growing up in the digital age, Gen Z appreciates the flexibility technology offers. They value work-life balance and seek autonomy in their roles, prioritising work-from-home options and flexible schedules. 
 
By incorporating ESG values into their operations, businesses can align with Gen Z's beliefs and enhance their Employer Value Proposition (EVP). 

How to attract gen Z talent with ESG

High employee turnover often indicates underlying issues such as poor work-life balance, lack of progression, and toxic management. An ESG-informed business demonstrates a commitment to purpose, inclusivity, and progressiveness, making it attractive to Gen Z.

• Green footprint: According to the 2024 Gen Z and Millennial Survey, with nearly 23,000 respondents across 44 countries, the majority of Gen Zs (86%) and millennials (89%) say having a sense of purpose is important to their overall job satisfaction and well-being. Reasons for rejecting an employer or an assignment include factors such as having a negative environmental impact and contributing to inequality through non-inclusive practices.
  
  
• Shared values: LinkedIn data shows that social causes are at the forefront of job seekers' minds, especially young workers: Three out of four millennial and Gen Z workers proactively seek out jobs that align with their values today. Their values include positive societal change, a deep concern for climate action, diversity, inclusion, and mental health.

An ESG-led business fosters motivation and performance, essential for retaining top talent. The 'Great Resignation' highlighted the importance of work-life balance and meaningful work, areas where ESG strategies excel.

If you're a candidate searching for a new opportunity, we're partnered with companies around the world that are implementing best practices in ESG.

Avoiding greenwashing

Greenwashing is a deceptive practice in which a company presents itself as environmentally friendly or socially responsible when, in reality, its actions do not align with these claims.

This can include misleading advertising, false certifications, exaggerated claims of sustainability efforts, and more. Greenwashing can negatively impact an organisation's talent attraction strategy by eroding trust with potential employees who value transparency and authenticity. 
 
For example, a company may promote its commitment to sustainability by using eco-friendly packaging for its products. However, its manufacturing processes may still heavily rely on unsustainable practices. This can mislead environmentally conscious job seekers looking for companies that align with their values. 
 
Another example of greenwashing is a company boasting about its charitable donations or community initiatives while ignoring issues within its organisation, such as poor working conditions or a lack of diversity and inclusion. This can turn off potential employees who prioritise organisations that genuinely have social responsibility. 
 
Ultimately, greenwashing can damage an organisation's reputation and make it difficult to attract top talent, especially among younger generations who place a high value on corporate social responsibility. 

Benefits of ESG implementation  

• Fuels growth: Integrating ESG principles can lead to enhanced market performance and investment in the company. 
• Attracts talent: Companies with strong ESG commitments often become more attractive to potential employees. 
• Retention of employees: ESG-focused companies tend to retain top talent due to shared values and ethics. 
• Transparent reporting: ESG fosters accountability and transparency in reporting, building trust with stakeholders. 

ESG: A brief history and timeline

Corporate Social Responsibility (CSR) was first developed by American economist Howard Bowen in 1953 and became widely adopted by companies in the early 1970s, following the introduction of the concept of the 'social contract' by the Committee for Economic Development in 1971. This concept posited that companies are established with the public's consent and, therefore, are responsible for giving back to society. 
 
The term "ESG" was formally coined in the International Finance Corporation's 2004 'Who Cares Wins' report, which provided guidelines and recommendations on how financial institutions could better implement ESG value drivers into market research, analysis, and investment in the financial sector.

Key takeaways

• Gen Z values: As the future workforce, understanding what this generation values is crucial. 
• Financial stability: Gen Z, shaped by the Great Recession, places high importance on financial stability. 
• Employer pride: They view employers as extensions of their personal brands and seek to work for companies they can be proud of. 
• Tech savvy: Gen Z embraces technology and values the flexibility it brings.

Gen Z is reshaping the workplace by prioritising sustainability, diversity, mental health support, and work-life balance.

Companies with robust ESG strategies and innovative environments are better positioned to attract and retain this highly-qualified, digitally native talent.