Sustainable Change: Meaningful ESG goals can help address labour issues

My drive to the office only takes a few minutes, but I pass a dozen or more companies who are all offering signing bonuses in a desperate effort to fill vacancies.

As we exit the pandemic, navigate through the Great Resignation, and scale the wall of the worst inflation in a generation, we are facing what Food and Beverage Canada calls a “debilitating workforce crisis”. Vacancy rates of 25 per cent are now the average across our industry and things are predicted to get worse. Food Processing Skills Canada (via Food and Beverage Ontario) estimates there will be 54,000 vacancies in the food system within the next two-and-a-half years.

Companies are dropping product lines, staff are getting burnt out, and food is staying in the field. The financial impact is real: agricultural producers lost nearly $3 billion in sales in 2020, directly attributed to unfilled vacancies.

Companies are trying different solutions to resolve this problem. Nearly a third of all Canadian firms are now providing signing bonuses, 29 per cent are offering more paid time off and 46 per cent are increasing salaries. I even saw one consultant suggesting recruiters offer free Friday dinners for a year to new staff.

These measures are not cheap and directly impact bottom lines at a time when margins are being squeezed from all sides. Are they effective, though? Well, the jury is out on that. Yes, if you put up a sign outside your food processing facility offering a five-figure signing bonus, you’ll likely have a line up, but will that fix your labour problems? How many of those people will still be with you in six months, and how will they perform in the interim?

A study entitled, “Can offering a signing bonus motivate effort” found signing bonuses positively impacted employee effort and built trust with new employees only when labour markets were slack. When vacancy rates were high, signing bonuses had significantly less impact. So, what is the solution?

Food and Beverage Canada continues to lead action in lobbying for changes in policy to support the food sector, but in my opinion, we cannot wait for policy changes. Individual firms must look into their toolbox and find new solutions, and the tool appearing to have the most impact right now is sustainability and ESG.

In their recent State of Employee Engagement research, employee engagement firm WeSpire showed 93 per cent of employees who felt “their company was making a strong positive impact in this world were planning to stay in their jobs”. This contrasted with only 50 per cent for employees who felt their company was not making a positive impact.

Similarly, Deloitte’s research shows purpose-driven companies are seeing up to 40 per cent increased employee retention.

So, as an alternative to hiring bonuses, settling-in allowances, training bonuses or extra time off (all of which are lovely to offer if you can afford it), consider investing funds in solutions that will set you up for success in the long term.

Compelling, authentic goals

Good intentions lead nowhere in the world of ESG. You need goals and targets, preferably ambitious ones, for how you are going to reduce your environmental impact and improve the well-being of your people and communities. You need to monitor, measure, track, and report progress toward these goals to the public and your people. It will build trust and attract future employees who care about the same things you do.

Volunteer days

Provide the structure and incentives for employees to work with community organizations to design projects for how they want to use this volunteer time. Going beyond this, build out an annual program of employee community engagement, of which the two days are just highlights. Sure, you lose a couple of days of production every year but think about what you will gain.

Impact success meetings

Hold a meeting every six months for your employees to learn about the impact you are collectively making on environmental and social goals. Ensure your CEO gets up to talk alongside some of your frontline teams.

Holistic conservation assessment

Your employees see waste, particularly water and food waste because they are so visible, and they don’t like it. Conduct a holistic conservation assessment, identify the root causes, and give ownership and accountability to your team to execute the solutions. They will feel empowered and see themselves as part of the solution. Then share the success across the organization in your impact success meetings.

Translate the savings into meaningful data points. Use calorie calculators, such as the Food Loss and Waste Toolkit, to identify the number of people who could be fed with the food waste prevented, and convert your reductions in carbon emissions into equivalent numbers of cars being taken off the road.

Sustainability training

According to RBC, 3.1 million jobs will change during the next decade due to the climate transition. Green skills are the future and your willingness to invest in all your staff members could be key to attracting the right talent, while at the same time building leaders for the Decisive Decade.

Peer-learning is key to not just learning outcomes, but also to building trust across your organization, which is why we recommend community-based training platforms, such as our own LEAP Academy.

It is clear now that we are not going to return to life circa 2019. Too much has changed. The labour market has been truly disrupted and to misquote Einstein, we are not going to be able to fix these problems with pre-pandemic thinking. So, let’s take down the signs advertising large hiring bonuses and turn the industry into a magnet for people who want to make a meaningful difference. 

Cher Mereweather, CEO of Anthesis Provision, is a Canadian-based food industry sustainability expert.