By Linda Hsieh, Editor & Publisher
While ESG has become the top buzzword in our industry over the past couple of years, sometimes there can be such an overwhelming focus solely on “environment” that we forget ESG encompasses more than just the carbon footprint. “Social” and “governance” are also key pillars of ESG, and investors are increasingly looking at what organizations are doing to advance diversity, inclusion and equity in their workforce.
In June, the Energy Workforce and Technology Council (formerly PESA and AESC) issued its 2021 Inclusion & Diversity Study. It recognizes that diversity is important not only because of increasing scrutiny by investors, but also because it leads to more innovation, and we know that innovation (or the lack of it) can make or break us at this critical juncture in our industry’s path.
In fact, companies with inclusive culture policies “are reporting an increase of over 50% in the area of innovation and creativity within their organizations, which is phenomenal,” said Lamonica Spivey, who works for TechnipFMC and serves on the Council’s Inclusion & Diversity Committee.
One of the most positive trends identified in the study is the increasing representation of women within the US energy technology and services sector. Women now make up 19% of this sector’s workforce, compared with 16% in 2018. It was acknowledged that the 2021 study is based mostly on information collected during 2020, which was not exactly a typical year. In fact, the Council estimates that more than 100,000 energy jobs were lost due to the pandemic and associated drop in oil prices. Additionally, research done by the Federal Reserve Bank of Dallas indicates women left the workforce at a higher rate than men over the past year, which is attributed to the rise in remote schooling and increased child care responsibilities.
The fact that gender diversity improved despite these challenges shows the industry continues to head in the right direction.
Another piece of good news is that women are now more equally distributed between business support and technical/operating roles. Nearly half of all women in this sector (48%) are now in technical/operating roles, compared with just 36% in 2018.
To continue advancing gender diversity, the council recommended that more focus be placed on supporting women so they can advance into leadership roles. Within technical/operating functions, women still make up less than 11% of first-line and middle/upper management and less than 9% of the highest-ranking executives, according to the study. “As we continue to progress, it’s important to think about not just the overall numbers but where in the career paths and in the organization you can find women,” said Diana Alcala with Accenture Strategy, which partnered with the Council to conduct the study.
Ethnic minority diversity
While the Council’s 2018 study focused just on gender, this time it also incorporated analysis on diversity in terms of ethnic minorities. Here, the council found that the US energy technology and services sector lags both the US oil & gas workforce and the overall US workforce in terms of ethnic minority representation. A quarter of this sector’s workforce (25%) are minorities, while the US oil & gas workforce has 28% and the US workforce has 36%. Minorities also face similar challenges as women when it comes to moving into management and top leadership roles. Especially within technical/operating roles, they make up less than 9% of the highest-ranking executives.
To enhance the resilience of the future workforce, the report urged a continued focus on attracting diverse talent. For example, women still account for less than 20% of entry-level recruits within the sector even though they account for more than 36% of STEM degree undergraduates in the US. When it comes to retention and career advancement, flex work policies and mentorship programs are seen as key enablers.
For more information, use the link below to access the study. DC
Click here to download the 2021 Inclusion & Diversity Study.