Why Does ESG Matter to Employers and Jobseekers?

While salary, benefits, and career advancement opportunities are still important to UK jobseekers, they’re no longer the only driving factors. More and more candidates want an employer who shares their values, whether that’s fairness, sustainability, or ethical leadership.

ESG (Environmental, Social, and Governance) is a framework for measuring how responsibly and sustainably a business operates. This isn’t just about what a company sells or produces, but how it behaves and affects the world around it.

Let’s break ESG down into its three components:

• Environmental:How does a company affect the planet? This includes emissions, energy use, waste, and climate awareness.
• Social:How does a company treat its employees, customers, suppliers, investors, and the general public? Think workplace culture, diversity and inclusion, wellbeing, and fair pay.
• Governance:How is a company led and managed? This covers transparency, ethical leadership, board diversity, compliance, and accountability.

ESG is about doing business in a way that’s good for people, the environment, and long-term performance. Along with compensation and career development, ESG has become a key factor in how individuals choose where to work and how businesses build trust, maintain their reputation, and stay competitive.

Why ESG Matters to Employers

So is ESG key to a company’s ability to attract and retain talented employees or is it just a distraction? Here’s how ESG is making a real difference for employers:

  ESG Attracts the Right Talent

Jobseekers want to work for companies that care about the same things they do. This is especially true for the younger generations. ESG demonstrates what an organisation stands for. That can make all the difference when choosing which vacancies to apply for and job offers to accept.

According to The Electric Car Scheme, 68% of UK workers aged 25-34 say it’s important to work for a company that shares their values.

  ESG Helps Retain the Right Talent

ESG isn’t just about recruitment. Employees are more likely to stay with a company that they believe is doing the right thing. This is especially true when it comes to social responsibility and sustainability.

A Robert Half survey found that nearly 2 in 5 employees would look for a new job if their current employer wasn’t doing enough on ESG. Among the 18-34 age group, that rises to nearly 50%.

  ESG Improves Employer Brands

Strong ESG practices show that an employer is serious about helping people, protecting the planet, and leading in an ethical way. This builds trust, both within and outside the company.

A 2024 survey by Indeed found that 57% of UK workers care about their job having a positive impact on society, and 55% feel the same about environmental impact.

  ESG Prepares Employers for the Workforce of the Future

Gen Z and younger millennials are value driven. They expect employers to take the lead on major issues like climate change and inclusion. Companies that take ESG seriously now are better placed for the future.

Deloitte’s Global Gen Z and Millennial Survey shows that climate action and responsible business practices are top priorities for young workers.

Why ESG Matters to Jobseekers

It’s not just employers who are interested in ESG. Here’s why it matters to jobseekers too:

• ESG helps identify employers with shared values: Many jobseekers use ESG as a guide to find organisations that share their beliefs on sustainability, fairness, and ethical responsibility.
• ESG contributes to an improved work experience: Being part of a company that takes its social and environmental responsibilities seriously can increase productivity, engagement, and job satisfaction.
• ESG is linked to positive work cultures and fair treatment: Strong ESG performance often goes hand-in-hand with policies that support inclusion, diversity, and employee wellbeing.
• ESG helps employees make a difference: Many organisations with ESG strategies involve staff in initiatives such as volunteering, community engagement, and sustainability programmes.
• ESG is a growing priority among younger people: Research shows that Gen Z and younger millennials are making career decisions based on how seriously employers take environmental and social issues.

How Employers and Jobseekers Can Take Action on ESG

Whether you’re hiring or job hunting, ESG is something that everyone can engage with. Here’s how.

  For Employers

Make your ESG commitments clear in job adverts and descriptions, on the company website and social media, and in interviews.

Demonstrating company progress on sustainability goals, workplace inclusion, or ethical practices can help attract the right talent and retain valuable employees.

Involve employees in ESG initiatives, like volunteering schemes or green workplace programmes. This can build a stronger sense of purpose and community within the workforce.

  For Jobseekers

ESG can be a useful way to assess potential employers. Researching company values, published ESG reports, or participation in ESG initiatives can provide valuable insights. You could also explore employee reviews or sustainability ratings to get a grasp on how well an organisation aligns with your beliefs and priorities.

Wrapping it up

ESG isn’t just business speak or a tick box. It reflects the values that matter to both jobseekers and businesses. For employers, it’s an opportunity to attract the right talent and build a more responsible, resilient business. For jobseekers, it’s a way to find meaningful work with companies that are serious about their social and environmental impact.

ESG is no longer a side issue. Instead, it has become central to how employers operate and jobseekers choose where to work.