How People Sustainability Will Shape The Future Of Human Resources
As the world continues to come to terms with the unprecedented challenges of new-age technology, remote work, and layoffs, one thing is clear: the future of human resources will be formed by our shared commitment to people sustainability. In the field of human resources, the idea of "people sustainability" is quickly becoming a major topic in conversations about what the future of work may entail in the next ten to twenty years.
This focus has come in response to a range of factors, including changing societal expectations, evolving workforce demographics, and increased awareness of the link between employee well-being and business success. In the years ahead, organizations that prioritize the well-being and development of their employees will be the ones that thrive, while those that fail to recognize the importance of this critical issue will face several challenges in retaining their top performers.
The good news is that with this shift comes an opportunity to create a more equitable, just, and fulfilling workplace for all.
But What Exactly is People Sustainability?
At its core, people sustainability is about recognizing that our greatest asset is not a product, service, or even the shiny, new technology – it's our people. It's about acknowledging that the well-being and potential of every individual in our organization are more than a moral imperative. It’s a strategic advantage. When investing in people, sustainability becomes our prime focus; what we really are investing in is the future of our company and the world at large.
People sustainability is about fostering a culture that empowers, supports, and nurtures our people to do their best work and achieve their full potential. It entails valuing diversity, equity, and inclusion as essential components of a thriving organization. It means recognizing that our employees are not just workers but human beings with complex needs and desires and working to create an environment that addresses those needs.
For human resource professionals, their greatest asset is the people. That's why the rise of people sustainability in the HR space is not just a trend but a fundamental shift in expectations that will determine the success or failure of organizations in the years to come.
The performance of a company over the long term and sustainable people management are strongly positively correlated, according to recent research. Zeynep Ton, an MIT professor, masterfully reveals the vicious loop of a lack of people sustainability in his book The Good Jobs Strategy. He contends that companies promote undesirable professions with low compensation, limited job security, and instability, which ultimately leads to operational challenges, decreased revenues, and lower labor costs, furthering the vicious cycle.
Meanwhile, from May to August 2022, SAP sponsored IDC to conduct a study to discover if investment in people sustainability could drive positive business outcomes. IDC surveyed more than 3,500 employees and business leaders across 11 countries and four regions.
The result was resoundingly positive. The research suggests that a focus on people sustainability can not only impact an organization’s performance but positively affect economic and environmental outcomes too.
Yet, it's not all about the numbers and data. A major factor that cannot be ignored is the rise of the millennial and Gen Z workforce, which is advocating for a more purpose-driven and socially responsible workplace. Human resource leaders must understand that while we discuss people sustainability, we are focused on:
Employee Health and Well-being: Organizations are recognizing the importance of employee well-being in creating a sustainable and engaged workforce. A focus on employee well-being can improve productivity, reduce absenteeism and turnover, and boost engagement and retention. Along with physical well-being, this also entails emotional stability, mental well-being, and work-life balance. HR teams can implement several efforts to make this a reality, including wellness programs, mental health assistance, flexible work schedules, and training in stress management and resilience development.
Financial Well-being: When your staff members are confident in their financial situation, they are more likely to concentrate on their work and help your company succeed. When you prioritize your employees’ financial well-being by offering relevant resources, including financial planning sessions, advisor access, retirement plans, and programs, you are also inevitably advancing financial literacy. Also, you can go down the road of fostering a culture of sound financial management by promoting open dialogue about money matters and offering chances for advancement.
Diversity, Equity, and Inclusion: As a leader in the HR space, it's important to recognize that prioritizing DE&I is critical to driving people sustainability in your organization. When employees feel seen and heard, they tend to feel a sense of belonging and to be more committed to the company's mission and values. A good place to start to stop the issues before they get out of hand is by reviewing the company's hiring and promotion procedures to uncover any potential areas of bias and putting a plan in place to eradicate those biases. HR can also promote inclusion by fostering dialogue among various employees, coaching managers on how to lead a diverse team, and fostering an atmosphere where workers feel comfortable speaking out.
Ethical and Responsible Leadership: Ethical and responsible leadership is becoming increasingly important in the current social and political climate. It is no longer a buzzword; it's a need. Leaders who prioritize transparency, accountability, and social responsibility are more likely to build trust with their employees and create a culture of respect and fairness. Ethical leaders set the tone for the organization by modeling behavior that is consistent with the company's values and mission. To prioritize ethical leadership, HR leaders might start by creating a code of conduct that establishes ethical standards for both employees and executives.
Environmental Sustainability: Environmental sustainability is also a critical factor in the people's sustainability agenda. Companies are increasingly being pressured to act to lessen their environmental effect and support sustainable practices as concerns about climate change and environmental degradation continue to rise. According to studies, employees are happier and stay with organizations with strong environmental, social, and governance (ESG) standards for a longer period. Also, these businesses claim 40% higher levels of employee retention and 30% higher levels of innovation than their competitors.
Empowerment, Purpose, and Meaning: Giving employees a voice and a sense of empowerment is a key factor in building a sustainable and engaged workforce. This entails paying attention to employee feedback, allowing for employee input and decision-making, and fostering an environment of open communication and trust. More and more workers are seeking fulfillment beyond a paycheck. They want to work for organizations that have a clear sense of meaning and purpose and that are changing the world. Companies are more likely to draw in and keep top talent if they can express their purpose clearly and link it to their business objectives.
Technology and Innovation: The agenda for people's sustainability is being driven by technology and innovation more and more. New technologies are opening up new possibilities for employee engagement, learning, and productivity, from blockchain to virtual reality. Building a sustainable and competitive business model is more feasible for organizations that can leverage innovation and technology.
Conundrums in Fostering People Sustainability Strategies
Although many factors can be linked to a positive correlation between people's sustainability and company performance, I would like to stress that the core moral decision to uphold this level of corporate responsibility is always the cornerstone for properly incorporating people's sustainability practices.
Investing in people's sustainability can initially result in higher expenses and even short-term losses, affecting your quarterly figures. In highly competitive markets, it is critical to respond to these challenges creatively, break new ground, and create suitable business cases for change.
This phase is like thin ice that requires a strong moral determination for corporate responsibility to endure. Only when this is lived out in turbulent and difficult times can true organizational change occur. Moreover, companies must constantly review the next steps, engage in dialogue with employees, and develop the people's sustainability maturity level.
The good news is that organizational culture is always capable of reform. Corporate leaders and managers can ultimately tilt the scales in favor of sustainable attitudes and actions by influencing their own and other people's belief systems. Another encouraging development is that businesses don't have to rely on top-down command and control, coercion, or even peer pressure. These concerns are already felt by people.
Take Patagonia, a clothing company known for its commitment to sustainability, for example. It offers employees on-site childcare, paid leave for environmental activism, and a generous benefits package. The result? Patagonia has one of the lowest turnover rates in the retail industry.
In a similar vein, the social media management firm Buffer employs a wholly remote workforce and provides unrestricted vacation time, parental leave, and mental health care. The result? Buffer has a highly engaged workforce and has been recognized as a top workplace by multiple organizations.
If we want to fully realize the power of people's sustainability, we must approach it holistically. This includes considering not only our actions' effects on the environment but also their social and economic repercussions. By promoting a sustainable culture that cherishes the well-being of our employees, clients, and communities, we can build a future where everyone thrives. It's time to take action, and it's up to us all to lead by example.
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