Why diversity in the oil and gas industry is good for business
It’s clear that the gas and oil industry is going through a significant period of upheaval. With geopolitical unrest, a widening skills gap, and challenging legislative changes, it certainly can’t be business as usual for the industry to thrive.
Mindsets need to adjust in order for positive change to take effect. And diversity is key to this.
Diversity encourages innovation
Why is diversity so effective? Firstly, diversity in senior roles encourages innovation, as people feel more comfortable expressing their ideas and are confident they are listened to. Without this, women are 20% less likely to have their ideas considered; people from ethnic backgrounds are 24% less likely; and employees who identify as LGBTQ are 21% less likely.
By employing people from different backgrounds, with different experiences and viewpoints, you will encourage different perspectives and will find new ways of looking at problems. In fact, companies with employees that have diverse heritage as well as diverse skill sets and experience are more likely to see their market share grow and are more likely to capture a new market too.
Even in a recent survey conducted in January 2019 by advisory and assurances expert EY, revealed that 94 per cent of respondents believe that diversity in thought and experience will help navigate industry disruption.
Studies conducted around the globe also come to the same conclusions: diversity is good for business. Ethnic diversity can increase profitability by as much as 30%. In the US for every 10% increase in racial and ethnic diversity among senior roles, earnings rise by around one per cent.
It helps to nurture and retain talent
A further reason to include increased diversity efforts in your business strategy is that companies who actively hire diverse teams are actually more likely to attract and retain talent – something which we know is a pressing issue in our industry, with the ever growing skills gap.
But active steps have to be taken.
Looking at gender specifically, World Petroleum found that just 22% of the oil and gas workforce is made up of female employees. This is, in part, due to a shortage of women in STEM education programs but can also be attributed to the perception of the oil and gas industry. It’s still regarded as a male-dominated work environment, which can put women off from applying for oil and gas jobs.
Of course, diversity doesn’t just stop at gender, and to combat the lack of representation of both gender and different backgrounds, the industry needs to be proactive in making change. Oil and gas companies need to appear attractive to work in, there needs to be equal work-life balance opportunities, plus there needs to be more career paths towards senior leadership positions and top level executive roles.
It’s the answer to the skills gap
We know the skills gap is set to worsen over the next five years as cuts to graduate recruitment during the oil downturn are still felt. Engineering roles are predicted to be the worst hit, as graduates are now aggressively recruited by technology companies for their transferable skills.
So how does the traditional oil and gas industry compete with modern tech companies? By proactively hiring a diverse workforce. Seeking out talent and putting the right measures in place to attract a diverse field of talent will naturally help you appeal to a larger pool of candidates.
Interestingly, the technology sector also has a problem with diversity. Netflix has women in only 30% of it’s technical roles but it’s by far the leader. Just 20% of Microsoft’s technical roles are filled by women and Google is only just ahead with women in 21% of its technical positions. This is in part due to the same problems both industries face when it comes to education. However it’s a common trait that could be used to the advantage of the oil and gas industry.
Part of this means understanding what appeals to graduates. High salaries are now no longer the main motivator for young people looking for jobs, with more and more citing opportunity for progression and good company culture as a major draw for employment.
It also means thinking outside the box and understanding how skills can be transferable. Data science and analytics will be important features in the future of oil and gas so it’s crucial to understand how to get in front of those graduates and appeal to them.
The signs are promising
For diversity to take effect, it needs to start with leadership. Executive oil jobs and gas roles are steadily being filled with more diverse hires which will inevitably have a trickle down effect to the rest of the company.
Exxonmobil currently has three women on its board of directors and two people of ethnic backgrounds on its 10 member board. It also facilitates a number of employee networks, all designed to boost diversity including People for Respect, Inclusion and Diversity of Employees (PRIDE) and Black Employee Success Team (BEST).
Exxonmobil’s drive for diversity can be seen in its external actions too. It supports several organisations including the National Action Council for Minorities in Engineering as well as championing immigration policies that will attract the diverse talent needed in the industry.
Shell has taken similar actions to increase gender diversity and has an equal number of men and women sitting on its board. The corporation encourages a healthy work-life balance and provides support networks for disabled employees, transitioning employees, and employees with mental health struggles.
While several oil and gas companies are getting to grips with the gender balance, British Gas and Direct Energy owner Centrica has a racially and gender diverse board, just going to show there doesn’t need to be drastic upheaval.
Time to be proactive
Given the global nature of the oil and gas industry, a diverse workforce made up of different ethnicities, genders, and backgrounds is certain to attract more of the talent you need for a bright future.
ABN Resource are an oil and gas recruitment agency who specialise in placing executive talent. With over 20 years of experience, we keep our ear to the ground to understand the latest trends and challenges the industry faces. To read more industry insight pieces then sign up to our monthly newsletter below, or sign up for job alerts based on your preferences. Find more oil and gas industry insights on our blog.