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How ESG Promotes Employee Engagement

Why is implementing ESG efforts beneficial for your business? ESG initiatives are helpful not only for the world at large but also for boosting engagement and retention internally. A recent study revealed that employers with ESG-related initiatives stated that their employer’s ESG goals made them proud to work there, made their jobs feel more meaningful, and made them want to stay with their organization. Read our blog to discover key tips for ESG initiatives and learn how to apply them in your workplace today.

For years, businesses have wrestled with how to do best by their shareholders (typically by focusing on maximizing profits), their employees (by focusing on engagement programs), and their external stakeholders (by considering their societal impact). An increasingly common way for companies to work toward these goals is by committing to Environmental, Social, and Governance, or ESG, initiatives. 

The ESG market is already relatively large in 2023 and continues to grow rapidly. According to Bloomberg Intelligence, the global total of assets managed by ESG-related funds is nearly $41 trillion, up from $22 trillion in 2016. By 2025, they estimate ESG investments to surpass $50 trillion worldwide—indicating that these efforts will not slow down anytime soon.

Now more than ever, employees are attracted to purpose-driven organizations, making ESG initiatives beneficial not only for the world at large but also for boosting engagement and retention internally.

What is ESG, and why is it important for companies and their employees?

ESG is a term used to refer to a whole suite of corporate responsibility programs targeting environmental, social, and governance solutions. It considers more than just profit generation and makes companies consider the long-term impact their decisions have on the planet and society.

However, some businesses may not know that promoting ESG efforts isn’t just good for the bigger picture but can also be extremely helpful for boosting employee engagement and well-being. There are a few reasons why.

Employees identify themselves and draw a significant amount of their sense of purpose from their work. Employees’ commitment to their work is reinforced by having a connection to something more significant and impactful than their day-to-day tasks.  

Additionally, SHRM found that 86% of workers at employers with ESG-related initiatives stated that their employer’s ESG goals made them proud to work there, made their jobs feel more meaningful, and made them want to stay with their organization. This is especially true of younger workers.

A Marsh & McLennan study reported that employers with more diversity, emitting lower carbon emissions, and making a greater effort to understand employee feelings are more likely to have a high level of employee satisfaction and be popular employment options for new graduates.


The environmental aspect of ESG asks companies to consider how their actions use energy and resources and how they create waste. From the production of physical goods to the way that an office runs, each company can work to improve its sustainability efforts differently.

Here are some examples of environmentally-focused improvements you can make to your business to make it more sustainable: 

  • Take a stance on environmental sustainability. Make a statement on your website and stand by it in your service. 
  • Go digital (paperless) as much as possible. 
  • Encourage environmental engagement through in-office programs, company-sponsored community service days, and more.
  • Choose sustainable supply chain partners. 
  • Offer a tree donation or other sustainable contribution.


For a long time, we largely ignored businesses’ societal impact. The social portion of ESG pushes companies to question how their actions affect people broadly, how they do their part to support diversity in and out of the workplace, and how they treat partners, employees, and stakeholders.

A few ways to get started with bolstering socially responsible and inclusive practices in your workplace include: 

  • Develop workplace diversity, equity, and inclusion (DEI) initiatives. DEI programs can help people feel safe and supported in the workplace.
  • Support diverse communities of different backgrounds, cultures, ethnicities, and abilities. Have members of underrepresented communities within your organization lead employee resource groups where they share experiences and celebrate similarities and differences with other employees. 
  • Have an unbiased approach to your clients, vendors, and employees. Aim to treat all parties fairly and not “play favorites” or otherwise discriminate.


Governance refers to whether or not a company’s decision reflects ethical, honest, and fair principles. 

Here are some ways that you can promote proper governance at your company: 

  • Work with diverse partners or outsource to minority-owned businesses. Expanding diversity among your suppliers may help close gaps across the business ecosystem. 
  • Promote pay transparency. Salaries should be fair and equitable, regardless of race, gender, and other demographic factors.
  • Aim to have equal minority representation on your board and report on the revenue for minority-owned partners and outsourcing. 
  • Avoid “greenwashing” your products and services. This refers to marketing your business practices as sustainable when, in fact, they are not.

Learn More About Our Standing ESG Commitment

As an HR outsourcing company, we recognize our responsibility to operate our business in an environmentally and socially responsible manner while upholding strong corporate governance practices. Learn more about our ESG commitment here

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