7 examples of ESG best practice from the European Union - and how EU regulation is influencing the talent landscape

7 examples of ESG best practice from the European Union - and how EU regulation is influencing the talent landscape

It’s fair to say that the European Union (EU) has been leading the way when it comes to implementing and promoting ESG standards and practices. As an ESG recruiter across both Europe and the US, it is very interesting for us to see how nuances in the two approaches are reflected in the talent pools of those respective geographies.

Broadly speaking, the EU takes a more holistic approach, realising that ESG issues are interconnected and that a long-term perspective is required.

Here are a few examples of how the EU is the trailblazer when it comes to all things ESG.

Stricter regulations and policies:  Europe has not held back when it comes to making businesses accountable. New EU rules have been introduced, with the aim of encouraging more companies to adopt positive ESG practices, such as the NFRD.

Greater focus on sustainability: The EU has set ambitious targets for reducing greenhouse gas emissions and increasing the use of renewable energy. It has also invested heavily in sustainable infrastructure and taken positive steps to support businesses which are committed to sustainability, such as the European Green Deal, with its goal of making the EU carbon neutral by 2050.

Sustainable investments: The EU has championed ESG considerations as a key factor in investment decision-making. The EU Sustainable Finance Disclosure Regulation, for example, has driven increased demand for ESG investments in the EU, with investors increasingly draw to sustainable businesses.

More comprehensive reporting: EU companies are obliged to report on a wider range of ESG indicators than in the U.S. This includes not only environmental factors such as carbon footprint but also indicators related to social and governance issues such as diversity amongst workforces and leadership teams.

Increased corporate transparency: The EU has also implemented schemes such as the CSRD and the EU Taxonomy, to help investors and other stakeholders make informed decisions about the companies they either work with or invest in.

Collaboration between public and private sectors: The EU has encouraged the development of joint initiatives, the sharing of resources and expertise, and the alignment of policies and regulations across both public and private sectors, which has resulted in more efficient and effective outcomes.

A push for stakeholder collaboration: The EU has fully grasped the importance of engaging and collaborating with a wide range of stakeholders and local communities, thereby ensuring that companies consider the holistic impact of their decisions and instilling greater trust in the public’s eye.

So what does all this mean from a talent perspective?

Leonid has a keen focus on ESG and sustainability globally. The different landscapes in regulation, attitudes and market conditions mean that there is an emerging gulf in what skills we recruit for when hiring a Chief Sustainability Officer, Head of ESG Research or Head of Corporate Social Responsibility.

The regulatory focus on Europe means we consistently see a closer alignment with compliance and risk across the region.  This is opposed to a US/Canadian stance of internal policy management and business-driven goals which can align anywhere from mid-level stand-alone professionals – there to improve awareness - all the way through to a Board level position whose role is to anticipate regulatory change, economic shifts and public demand for environmental governance.

With the EU being a clear leader in structuring ESG best practices and regulating both financial and non-financial markets, it is likely other jurisdictions, especially the US, will increase their alignment with the EU and adopt a more holistic approach. This in turn means that ESG skill sets will ultimately become more globally aligned.

At Leonid, we recruit for jobs in all areas of corporate governance, including ESG, compliance, risk, audit and legal. If you are looking for a new role or a new hire in your ESG team, please contact adam@leonid-group.com to find out how Leonid can help with your corporate governance recruitment.