To Reach Sustainability Goals, Organizations Must Address Critical Sustainability Skills Gap

• New Research from BCG and Microsoft Finds Significant and Widening Sustainability Skills Gap as Increasing Number of Companies Make Commitments to Reduce Emissions
• Companies Could Face Upskilling Up to 150 Million People in Under Ten Years to Turn Sustainability Ambitions into Action
• Roughly 2/3 of Sustainability Leaders Are Hired from Within; More Resources Needed to Support Skill-Building Efforts for Initial Talent and to Scale Efforts Across the Organization
  

BOSTON, Jan. 11, 2023 /PRNewswire/ -- From 2007 through 2022, the number of companies setting science-based targets has grown by a factor of 36—to more than 4,200 companies. According to separate BCG research, only 17% of those that have set targets are on track to meet them. Meeting these goals will require organizations to embed sustainability across their business; however, according to new research by Boston Consulting Group (BCG) and Microsoft released today, there is a systemic sustainability skills gap that must first be closed.

The report, titled Put Talent at the Top of the Sustainability Agenda, examines some of the talent-related obstacles that could slow the process of making sustainability a reality, and details how sustainability frontrunners are innovating to meet those challenges during different stages of an organization's sustainability transformation journey: mobilize, embed, and accelerate. The research is based on the experiences of 15 companies, including Microsoft and BCG, in seven industries and three geographic areas (North America, Europe, and Asia). In addition, it highlights findings from a survey of almost 250 sustainability professionals at those companies and others, including more than 50 chief sustainability officers and sustainability leaders. Microsoft recently released its own report on closing the sustainability skills gap based on this research it conducted with BCG.

"Value creation for shareholders will increasingly be linked to effective leadership in sustainability, and employees are essential to that progress," said Rich Lesser, global chair of BCG and a coauthor of the report. "We're optimistic that an informed, inclusive approach to upskilling can provide us with the human capital we need. But given the urgency, this work must start now—at every company, across most business functions. We will need all companies to work together so that our global economy can quickly transition to a sustainable future for our planet."

According to the report, core teams helping companies to embark on sustainability transformations need individuals with a mix of four broad skill sets: sustainability, functional, transformational, and data and digital. Eighty-four percent of sustainability professionals surveyed listed priority skills for being successful in their role in at least two of those four capability areas. As there is limited talent with that broad skill profile, frontrunner companies are developing the talent they need by selecting employees with the necessary functional, transformational, and/or data and digital expertise, and then helping them rapidly gain the specific expertise to put their talents to work for sustainability.

Companies are relying heavily on their internal talent. More than half (68%) of sustainability leaders surveyed are "homegrown" and hired from within the company, while just 32% are brought in from the outside. More than half of people on sustainability teams (60%) say they were not hired for their sustainability expertise; with 32% considering themselves an expert in another field and 28% reporting they are not an expert in any field.

As talent step into their new sustainability-focused roles, they face a steep learning curve. Sustainability is a rapidly evolving domain, so the nascency of skills is by far the biggest upskilling challenge that sustainability professionals face (76% of those surveyed agreed), followed by not having enough time (38%), and facing a lack of access to fit-for-purpose training solutions that effectively bring sustainability to life in a business context (31%). The leading methods of upskilling found most useful by survey respondents were work experience (93% agreed), published material (63%), and attendance at conferences and presentations (57%) (see the exhibit).

Although companies can rely to a degree on external learning providers to upskill their teams, it's still difficult to find formalized courses and certification programs focused on the sustainability skills required for business.

To achieve corporatewide sustainability goals, skilling must go well beyond the core team that starts and then shepherds the journey. Each member of the organization must gain general sustainability fluency and merge their existing functional skills with the requisite sustainability skills for their role, in order to perform their jobs in new, sustainable ways. Companies in this "embedding" phase are guided by that core team of sustainability professionals established in the mobilize stage but must scale up their enablement efforts as they begin to transform how the business operates. They can rely on classic enablement approaches, as demonstrated by sustainability pioneers, such as:

• Cascading sustainability fluency throughout the organization by offering access to classroom instruction and online training opportunities that build a common understanding at scale, and provide a springboard for more specific learning thereafter
• Establishing a center of excellence model, where new sustainable business processes—and the skills that go with them—can be incubated until they are handed off to and deployed in functions or business units.

In the final phase of an organization's sustainability transformation, talent with sustainability capabilities is in place in every part of the organization, and sustainability is becoming part of business as usual. But the work of actually driving to sustainable outcomes is far from over, and the need for skilled talent remains as critical as ever. According to the research, as companies face this "new normal" phase, several talent priorities emerge, including:

• Planning proactively for career paths and creating future roles and mobility opportunities for core sustainability talent, whose value in the market for talent will increase
• Continuing to invest in ongoing education and upskilling opportunities to ensure talent—on the core team and across the organization—keeps up with new sustainability technologies and regulations
• Focusing on evolving corporate culture to make sustainability an intrinsic part of everyday work, and inclusively migrating the workforce to be part of new sustainable businesses, business processes, and ways of working.

Companies must think today about how they will support, enable, and retain their future sustainability-capable workforce, not only to mitigate the risk of losing them to competitors but ultimately to turn sustainability into lasting competitive advantage with their help.

"With crucial sustainability targets set for as soon as 2030, organizations are faced with a herculean undertaking: leading the charge on upskilling as many as 150 million people, in various facets of sustainability, in less than ten years," said Elizabeth Lyle, a managing director and partner at BCG and a coauthor of the report. "Our collaboration with Microsoft shines a spotlight on the practical workforce challenges that companies must navigate on their sustainability journeys. Our goal is to illuminate practices from pioneering companies that can make the path ahead easier for the many companies who will soon be seeking to build their sustainability-capable talent."

Download the publication here: https://www.bcg.com/publications/2023/prioritize-talent-within-sustainability-agenda

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SOURCE Boston Consulting Group (BCG)