The energy sector has already begun making waves in diversity and inclusion, The "Equal by 30" initiative has garnered support from the G7 and numerous industrialised nations, along with over 135 energy companies. This public commitment unites both public and private sector organisations in their shared goal of achieving gender equality, encompassing equal pay, equal leadership, and equal opportunities for women within the clean energy sector by 2030. Yet, currently, women account for just 32% of the energy sector workforce globally. According to the OGUK Diversity & Inclusion Survey Report, the energy sector as a whole is in agreement that more needs to be done to attract a more diverse talent base to unlock the full potential of the skills available within society.
We explore the current state of the energy sector, delving into the gender gap in energy and renewables, the benefits of gender diversity for businesses, and strategies for closing the gender gap in energy.
What’s in this article?
- Key takeaways (TLDR)
- Understanding the gender gap in the energy sector
- Why should gender diversity be a priority for your business?
- 5 Strategies for closing the gender gap in energy
- FDM: Leading the way for women in energy
Key takeaways (TLDR)
- As the pressure to combat climate change grows, there will be 139 million new jobs in the energy sector worldwide with 38.2 million in renewable energy specifically.
- Women only account for 16% of the traditional energy sector globally, and in the UK, women in energy earn 15.4% less than their male counterparts.
- There is a heightened urgency for the energy sector to harness the power of inclusivity to reach its full potential, which means a greater focus on gender equality is imperative.
- Improving gender diversity in the energy sector has many benefits, such as enhanced decision-making and innovation, improved company reputation, helping attract and retain top talent, expanding your market reach, and, ultimately, boosting financial performance.
- Implementing diversity and inclusion policies within your organisation is a fundamental step in closing the gender gap in the energy sector by creating an environment where women are encouraged to thrive professionally.
- Achieving pay equity, providing equal advancement opportunities, and standardising promotion processes is critical for closing the gender gap in the energy sector.
- Female employees encounter distinct challenges, including managing family responsibilities, which means offering family-friendly benefits can be key in attracting and retaining women in energy.
- Mentorship and sponsorship programmes play a pivotal role in supporting women's career advancement in the energy sector, providing a relatable role model.
- Collaborating with educational institutions encourages more women to pursue careers in the energy sector, breaking down barriers and inspiring the next generation of talent.
- FDM takes pride in leading the way for women in energy and renewables, and connecting energy organisations with top-tier talent, diverse talent.
Understanding the gender gap in the energy sector
As global pressure to combat climate change intensifies, the energy sector is currently experiencing a significant transformation. As investments pour into renewable energy projects and technologies, such as AI advancements, a surge in employment is being witnessed across various sectors, from manufacturing and construction to research and development. The World Energy Transitions Outlook predicts that by 2023 there will be 139 million jobs in the energy sector worldwide! Within this figure, an impressive 38.2 million will be in renewable energy and 74.2 million will be in other sectors related to energy transition. This projection highlights the growing demand for skilled professionals in the energy sector from all backgrounds.
Women currently make up approximately 39% of the global workforce, yet they account for just 16% of the traditional energy sector. And in the UK, according to Energy & Utility Skills, the Office for National Statistics (ONS) reports that the current gender gap in the energy and utilities sector is stark, with men earning 15.4% more than women. In particular, the largest gender pay gap can be found in the power industry (19%) and gas networks (17%).
The energy sector has long been a male-dominated field with many of the challenges encountered by women in the energy industry parallel to those in other sectors. However, with the pressing transformative nature of the sector, there is a heightened urgency for the energy sector to harness the power of inclusivity to reach its full potential, therefore, necessitating the issue of the gender gap in energy to be addressed.
Why should gender diversity be a priority for your business?
In today’s rapidly evolving energy landscape, it’s crucial for businesses to recognise the significance of closing the gender gap. It is not merely about meeting diversity quotas; it’s about embracing the undeniable benefits that come with a balanced workforce and inclusive culture. Let's delve into why addressing gender diversity is not just a matter of social responsibility but a strategic imperative for success in the energy sector.
5 Benefits of gender diversity for businesses in the energy sector
- Enhanced decision-making and innovation
- Improved company reputation
- Attracting and retaining top talent
- Expanded market reach
- Financial outperformance
1. Enhanced decision-making and innovation
Gender diversity encourages the inclusion of diverse perspectives, experiences, and thought processes in the decision-making process. This variety of viewpoints can lead to more comprehensive analysis of complex issues and the development of innovative solutions. Teams with diverse members, not limited to gender, tend to challenge conventional wisdom and think outside of the box, which is invaluable to any team! It is reported that diverse teams make decisions 66% of the time, in comparison to an individual decision-maker calling the shots. Furthermore, gender-diverse teams make better decisions 73% of the time! The key reason for this is bias. Making the right decision can often be derailed by unconscious biases from a particular group, therefore, by including opinions from different backgrounds, you are able to introduce different perspectives and counter these potential biases.
2. Improved company reputation
When organisations in the energy sector actively promote gender diversity, they signal to their stakeholders, including customers, investors, and the general public, that they are socially responsible and forward-thinking. This perception is particularly important in an era when corporate social responsibility (CSR) has become a critical consideration for stakeholders. This can also result in stronger stakeholder relationships, which can translate to more effective partnerships, improved access to funding and investment opportunities, as well as improved cooperation with regulatory bodies. All of these aspects will be fundamental to navigating the complex and rapidly changing energy landscape.
3. Attracting and retaining top talent
An organisation that offers equal opportunities and a supportive environment for all employees, regardless of gender, is more likely to attract high-calibre talent. If you’re looking to hire the next generation of top talent in the energy sector, then it is imperative that you adopt inclusive hiring practices. In fact, a survey from Monster,com revealed that 83% of Gen Z respondents say that a major influencing factor when choosing an employer is its commitment to diversity and inclusion. Learn more about how to attract, engage, and retain Gen Z talent.
Moreover, retention rates improve when employees feel valued, are given opportunities for advancements, and are treated equitably. A study by momentive reveals that a company’s commitment to social responsibility is now more important than ever for employee satisfaction, with 60% of employees saying they want businesses to speak up about social and political issues. Digging deeper, there is a clear disconnect between the views of non c-level workers and c-level executives, with 62% of non-c-level employees believing DEI initiatives are key success drivers, compared to just 48% of c-levels. Organisations that are able to recognise the importance of diversity and inclusion initiatives and practice diversity in recruitment are more likely to attract and retain the top talent and see the most success.
4. Expanded market reach
A diverse workforce can provide valuable insights into different market segments. For example, team members with diverse backgrounds can offer unique insights into how different groups of consumers, including women, make energy-related decisions. This understanding goes beyond stereotypes and allows for more accurate and nuanced market analysis. The enhanced understanding of your customers can improve marketing strategies, enabling you to resonate with specific consumer groups. This approach ensures that messaging around products and services are tailored to meet the needs of your consumers.
Additionally, the energy sector is inherently global, with companies operating in diverse markets around the world. A diverse team is better equipped to address the unique needs of this large customer base and adapt strategies to thrive in new regions. Likewise, as mentioned previously, expanding into new markets often requires building trust with local stakeholders, including customers, partners, and regulatory bodies. As such, a diverse workforce can foster trust more readily by demonstrating a commitment to inclusivity and social responsibility.
5. Financial outperformance
Research from the Harvard Business School, which analysed 1,069 leading firms across 35 countries and 24 industries, showed that gender diversity correlates to higher market value and revenue. Yet, this is only in businesses where gender diversity is widely accepted and believed to be of high importance. Similarly, research from Morgan Stanley echoes that companies with greater gender diversity and a higher Holistic Equal Representation Score (HERS)— outperformed less gender-diverse firms by 1.6%. This research was based on a total of 1,875 firms on the MSCI World Index. In the same study, share prices for gender-diverse energy companies in Europe showed to outperform by 23.7%.
5 Strategies for closing the gender gap in energy
- Diversity and inclusion policies
- Mentorship and sponsorship programmes
- Equal pay and advancement opportunities
- Flexible or family-friendly work arrangements and benefits
- Educational and outreach initiatives
1. Diversity and inclusion policies
Developing and implementing robust diversity and inclusion policies within your organisation is a fundamental step in closing the gender gap in the energy sector. These policies should outline clear objectives, metrics for measuring progress, and a commitment to providing equal opportunities for all employees, regardless of gender. Furthermore, organisations should establish mechanisms for reporting and addressing discrimination or harassment, ensuring a safe and inclusive workplace for everyone. By making diversity and inclusion a core part of the organisational culture, companies can create an environment where women are encouraged to thrive professionally.
2. Mentorship and sponsorship programmes
Mentorship and sponsorship programmes play a pivotal role in supporting women's career advancement in the energy sector. These programmes pair experienced professionals with early-career individuals, showing them the ropes and providing invaluable support. Mentors provide guidance and advice, while sponsors actively advocate for career advancement opportunities on behalf of their protégés. By participating in such programmes, women can build valuable networks, develop essential skills, and gain access to leadership roles, helping to bridge the gender gap in senior positions. Better yet, when these mentors are women themselves, young women in energy can learn from a role model they relate to and aspire to be like.
3. Equal pay and advancement opportunities
Achieving pay equity and providing equal advancement opportunities is critical for closing the gender gap in the energy sector. Organisations should conduct regular pay equity audits to identify and rectify any gender-based pay disparities, ensuring that women are compensated fairly for their contributions. Moreover, transparent promotion and advancement criteria should be established, and training and development opportunities should be provided to help women progress in their careers. By eliminating gender-based pay gaps and promoting women into leadership roles, companies can create a more equitable workplace, which will help attract and retain more women in the energy and renewables industry. If you are unsure of where to start, read our guide to gender pay gap reporting for further information.
4. Flexible or family-friendly work arrangements and benefits
For the energy sector to attract and retain female employees effectively, understanding and tailoring benefits to address their unique needs and enhance job satisfaction is paramount. Female employees encounter distinct challenges, including maternity leave and managing family responsibilities. Hence, offering family-friendly benefits such as dedicated breastfeeding rooms, comprehensive maternity leave policies, flexible working hours, remote work options, and assistance with childcare expenses is essential. These benefits not only reflect an inclusive workplace but also alleviate the hurdles faced by women in the energy sector, enhancing their overall job experience.
According to the OGUK Diversity & Inclusion Survey Report, women tend to regard the absence of flexible work options as a hindrance to their career advancement. They are also more prone to assess an organisation's stance on Diversity and Inclusion (D&I) and flexibility in work arrangements as a deciding factor when considering joining or leaving the company, compared to men.
These policies help employees achieve a better work-life balance, making it easier for women to pursue and maintain careers in the sector. By accommodating varying life circumstances, companies can retain and attract more women in the energy industry.
5. Educational and outreach initiatives
Collaborating with educational institutions and organisations is key to encouraging more women to pursue careers in the energy sector. Companies can engage in outreach initiatives, such as mentorship programmes, career fairs, and educational partnerships, to raise awareness about the opportunities available in the sector. Additionally, fostering a supportive environment that encourages women to pursue STEM fields and energy-related disciplines is vital for future talent pipeline diversity. These educational and outreach efforts can help break down barriers and inspire more women to join and excel in the energy industry.
Learn more about how to attract, engage, and retain women in your organisation.
FDM: Leading the way for women in energy
At FDM, our commitment to fostering gender diversity in technology is at the forefront of our mission. As such, we take pride in leading the way for women in energy and renewables, and connecting energy organisations with top-tier talent, diverse talent. Our tailored approach and proactive strategies ensure that companies not only meet their diversity goals but also benefit from the fresh perspectives and innovative ideas that a diverse workforce brings to the table. We are proud to contribute to the advancement of women in the energy sector while helping businesses thrive in this dynamic and evolving field.
Are you looking to hire the top diverse talent for your energy company? Check out the FDM Consultant services or get in touch for more information.