Corporations hiring sustainability personnel from consultancies could be creating a gulf in consulting expertise for companies to tap into, a recruiter suggested at a business summit in Hong Kong last week.
To continue reading, subscribe to Eco‑Business.
There's something for everyone. We offer a range of subscription plans.
- Access our stories and receive our Insights Weekly newsletter with the free EB Member plan.
- Unlock unlimited access to our content and archive with EB Circle.
- Publish your content with EB Premium.
Speaking on a panel at the ReThink conference on Thursday, Paddy Balfour, Asia Pacific executive director for recruiting firm Acre, said that the “industry is eating itself” as corporations hire from consultancies to meet a growing demand for environmental, social and governance (ESG) knowhow.
“Specialist consultants are getting hired into corporates. Corporates then go back to the consultants to get specialist advice – and realise there is no one there,” Balfour said.
This has led to companies searching for more inhouse expertise, which is hard to find, he said.
Balfour did not provide data to support his observation, but according to a published analysis on Acre’s LinkedIn platform, it noted that the global consultancy market has been facing some headwinds due to various factors such as hiring freezes and redundancies, yet “there remains a constant stream of work” for sustainability consultants and a demand for them to “get the job done”.
At the same time, companies lack specific specialist knowledge, want external support and are gearing up to use more consultances and professional services this year, it noted.
Speaking to Eco-Business on the sidelines of the event, Balfour said that the problem of a talent deficit in consultancies has softened somewhat since 2021, in line with a deceleration in the job market, but the problem continues to haunt the sector.
“Corporate roles are inherently more generalist in nature than consultants. It is imperative for there to be a healthy consulting market to ensure that deep technical experience is available across the market,” he said.
He noted that consultancies are being forced to fill the gap with less experienced consultants, which leads to an erosion in the quality of the advice being provided to the market.
His concern was echoed by John Pabon, sustainability consultant and author of a book on greenwashing, who noted that companies are often hiring consultancies, then finding they have to spend time up-skilling them on ESG.
“You pay big bucks for a big-four consultant that may only know as much, or even less, than you do,” he said, referring to EY, PwC, Deloitte and KPMG who make up the top four global professional services firm. “Instead of working on the laundry list of other things you have to do, you also have train your consultancy.”
“This isn’t to say there is no expertise in consultancies. But it is just not at the level of maturity commensurate with the astronomical price tag consultancies are charging,” he said.
In Asia, demand for corporate sustainability skills is growing rapidly amid rising disclosure and regulatory requirements, but the region has been struggling to fill the green skills gap, a survey by business social platform LinkedIn revealed last year. The region is lagging the United States and Europe in how quickly employers are adding sustainability expertise.
Balfour compared the evolution of the chief sustainability officer (CSO) role with the rise of the chief financial officer (CFO). The CFO has over the years graduated from accountant to senior corporate strategist. The CSO role has taken on a parallel degree of importance, but with the “missing engine room underneath”, Balfour said, referring to the gap in capacity needed to fulfill the role’s responsibilities.
Corporations need to create the “right pathways” for talent to enter sustainability roles, he said.
Missing youth talent pipeline
But the route into the sustainability workforce for young people is not easy, partly because of poor hiring decisions and competence greenwashing – that is, organisations exaggerating their sustainability expertise, suggested Mark Cheung, co-founder of the Hong Kong youth climate education group Network of Environmental Student Societies.
He said that young people are being held back from the job market by companies that are not creating enough entry-level sustainability roles to justify their green claims. “Companies usually think that having just one or two people is enough, but they are overlooking the real capacity we need to see in sustainability [to achieve goals],” he said.
Young people in Hong Kong are struggling to find accessible opportunities in sustainability, and university education is not preparing students well enough for sustainability careers, Cheung added.
Though the government has prioritised training the city’s lucrative finance sector, there is a need to develop sustainability talent in other areas and “build linkages” between universities and companies, he said.
Balfour said that companies need to invest in people from other industries and jurisdictions to fill sustainability roles as Hong Kong struggles with a talent crunch. “If you don’t think laterally, you won’t find the right solutions,” he said.
To put the corporate sustainability agenda in perspective, LinkedIn’s Hong Kong-based senior account director Celina Kwong noted that while demand for green skills has increased rapidly since 2016, demand for artificial intelligence knowhow has outstripped sustainability by multiple factors. “This shows where companies are really focusing their money on,” she said.
