
Essential upcoming ESG issues for investors & corporates
02 October 2020 | 1 min read
Matt Farnsworth
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Who do you employ on energy projects in your region or at your site? It’s important to consider the make-up of your workforce to satisfy today's Environmental, Social and Governance (ESG) requirements.
Sometimes, the ‘S’ in ESG gets neglected. Social issues aren’t always spoken about as much as environmental concerns, despite the importance of both. Meanwhile, governance is an overarching need as the pressure to have a solid audit trail for ESG measures grows.
In the energy industry, the presence (and content) of a local workforce is now seen as part of ESG responsibilities – whether they are mandated in the region where your project operates or are part of internal company ESG plans. In this insight, we’ll discuss where this pressure is coming from and what you should do to prepare. Read on to learn more.
Before we go much further, it’s worth defining what we mean by a local workforce. In the past, some energy projects have hired a local contingent to satisfy local laws, but in primarily non-technical roles such as security, janitorial or food preparation. The reasons for this can vary from poor hiring policies to a shortage of qualified applicants.
Today, the value of employing skilled and technical workers locally is increasingly recognised. Alongside the macro level of boosting economies and sharing wealth more evenly, there are tactical benefits too:
Related read: this article discusses balancing local and international standards in offshore wind development in Korea.
Local workforce requirements should be of particular interest to companies operating in regions and sectors looking to establish and maintain a social licence to operate, in cooperation with both regulators and local stakeholders. That could mean emerging economies seeking more control over local development or emerging technologies such as the renewables sector. Both have opportunities to set the tone with a fresh look at ESG and employment practices.
There are various answers to this question in relation to energy projects. The key message is to be aware of (or take advice on) the requirements, as they could impact project timescales and success. Examples are:
One key action is completing various forms of ‘audit’ – to understand, document and plan to extend the relevant technical skillsets available locally. This goes hand-in-hand with a second key action: providing competency-based training, to bridge gaps where a lack of qualified people prevents wider local hiring. Developing workers’ skills also grows the pool of future managers from within local teams.
The competency assessment framework
This assessment and documentation process is similar to a ‘gap analysis’. It might explore the skills needed for various types of role, and what relevant training is available locally (and to what standard). It may also cover organisational needs.
Find out more:
Capability and capacity development
Competency analysis and development
A local workforce development plan
This type of plan is focussed on the make-up of the workforce itself. It’s a robust assessment that takes into account relevant policies and procedures for hiring locals and provides statistics on how each vacancy has been filled. Assessors then explore how jobs that haven’t been filled by local workers could be localised over time, such as with external or on-the-job training.
In some cases, investors or lawmakers will require evidence of why hirers can’t supply a local workforce. This document can help you prove what hiring practices you’ve put in place. More importantly, a workforce development plan can support you in building a structure for a sustainable business. It goes further than simply putting ‘bodies on seats’ to boost the percentage of locals employed. Instead, it forms a competency register that also shows a pathway for the development of your workforce.
RPS is committed to “acting responsibly for the wellbeing of all”, and we have long experience of supporting local workforce development. Here are a few examples of how we support the expansion of local workforces, and how we put this into practice in our teams.
Our Training service offers learning programmes tailored to the energy sector. For example, we designed a program for Halliburton for 10 engineers from a Middle Eastern national oil company (NOC). This on-the-job course covered an extensive list of learning objectives identified by the NOC and included a field trip to West Texas.
This case study from our QHSE team explains how we supported a client in onshore wind to establish an environmental management framework, which would meet international standards and eventually be managed by local staff.
In project consenting (AKA approvals or permitting) for oil and gas, our teams have worked with local consultancies to prepare Environmental Impact Assessments and conduct stakeholder engagement. For example, on a 2D seismic survey project in Africa, we engaged a local university to support water sampling and stakeholder engagement.
On another project in Kenya we were supported in stakeholder engagement by a local environmental consultancy. Both projects allowed us to benefit from local knowledge and share technical skills.
RPS’ Unexploded Ordinance (UXO) service work with, train and support local team members through their accreditation process, as well as assessing and accrediting local companies, such as in this anti-personnel mine clearance project in Turkey.
Our Protected Species Observer (PSO) team, who deploy degreed biologists offshore, make efforts to keep their skilled international team members in an industry that can be seasonal. (In turn, this allows us to rotate team members with local knowledge where it’s needed on offshore energy projects.) Recently, the team worked with our client, SouthCoast Wind, to develop and deliver a training program widening access for local communities into US offshore wind employment routes.
In supporting the development of Korea’s offshore wind industry, our team have committed to building relationships and transferring knowledge. This has included holding seminars with our local partner to learn about both sides’ expertise and experience.
RPS’ ESG specialists work closely with our highly experienced energy consultants. We can support you with competency and workforce assessments, as well as advising on the wider context of energy-related ESG requirements.
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