SHRM Survey Findings How Have Sustainable Workplace Practices

SHRM Survey Findings: How Have Sustainable Workplace Practices Changed Over Time? February 8, 2013

Introduction How Have Sustainable Workplace Practices Changed Over Time? Ø In the last two years, SHRM released the Advancing Sustainability: HR's Role research report and Green Jobs—Are They Here Yet? poll. These studies examined, from the perspective of HR professionals, how U. S. organizations are balancing financial performance with contributions to the quality of life of their employees, the society at large and environmental initiatives. Ø Several of the survey questions from these studies were included in a recent 2012 study to determine how sustainability has changed over time. Ø When possible, analyses of the 2012 survey results by organizations’ staff size and sector are presented. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 2

Key Findings The study results reveal that the percentage of organizations engaging in sustainable workplace or business practices has remained stable over the last two years. However, there were slight declines in the percentage of organizations that participated in select socially responsible activities and environmentally responsible practices. There was also a small decline in the percentage of organizations that used select methods to demonstrate their commitment to sustainability, as well as those who reported select positive outcomes related to sustainability. The study also found positive news: there was a slight increase in the percentage of organizations that calculated a positive return on investment of their sustainability efforts. Key findings from the 2012 study include: Ø The percentage of organizations engaging in sustainable workplace practices has remained stable over the last two years. According to this survey, almost three-quarters (72%) of organizations reported engaging in sustainable workplace or business practices. Large and medium-staff-sized organizations and publicly owned for-profit organizations were more likely to engage in these practices. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 3

Key Findings (continued) Ø Sustainability is being used to attract, retain and develop employees. Fifty-one percent of organizations engaging in sustainable workplace or business practices reported their involvement in sustainability was very important in creating a positive employer brand that attracts top talent. In addition, 40% reported that involvement in sustainability was very important in improving employee retention and 36% indicated it was very important in developing the organization’s leaders. Ø Sustainability and the strategic planning process. Fifty percent of organizations engaging in sustainable workplace or business practices reported that they had a formal sustainability policy that included sustainable workplace goals and polices directly tied to the strategic planning process. Slightly more than four out of 10 (42%) reported having an informal policy that had no accountability through the organization’s strategic planning process. Only 8% of companies had no policy in place. Ø Drivers for the investment in sustainability. The key drivers reported were 1) contribution to society (39%), 2) environmental considerations 14%, 3) health and safety considerations (10%), 4) saving money on operational costs (10%), and 5) local/federal regulations (7%) How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 4

Key Findings (continued) Ø Return on investment for sustainability efforts. Even though determining the return on investment (ROI) for sustainability-related activities may be difficult, there is no reason for organizations to ignore outcome-based measurement tools. Nearly four out of 10 businesses (37%) reported calculating an ROI for their sustainability efforts. Among organizations calculating an ROI, 56% calculated a positive return on their investment, 39% reported it was still too early to determine their ROI, 5% calculated a break-even point and, most noteworthy, only 1% of organizations calculated a negative ROI. Ø Positive outcomes of sustainability initiatives. The top positive outcomes from organizational sustainability initiatives were 1) improved employee morale (53%), 2) stronger public image (51%) and 3) more efficient business processes (47%). How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 5

What does this mean to the human resource profession? • Research shows HR is largely responsible for implementing a sustainability strategy in organizations. [1] • Sustainability is a people issue and is important in shaping the organization’s behavior and culture. • Sustainability plays a large part in creating a positive employer brand, improving employee retention and developing leaders. • HR plays a large role in implementing sustainability strategies but not in developing these strategies. • Research suggests sustainability will continue to be a large people issue for organizations, making HR’s role in implementing the best sustainability practices all the more vital. [1] Society for Human Resource Management. (2011). Advancing Sustainability: HR’s Role. Retrieved from www. shrm. org/surveys How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 6

Sustainability Definition The word “sustainability” is difficult to define since sustainability is a dynamic and evolving concept. As a result, it can take on many different meanings and represents different things to different people. The definition also varies within different contexts and is sometimes confused with other concepts such as corporate social responsibility. For the purpose of this study, sustainability is defined as the commitment by organizations to balance financial performance with contributions to the quality of life of their employees, the society at large and environmentally sensitive initiatives. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 7

Organizations Engaging in Sustainable Workplace or Business Practices 72% Yes, engaging in sustainable workplace or business practices 72% 28% No, not engaging in sustainable workplace or business practices 28% 2012 (n = 550) 2010 (n = 583) Note: Respondents who answered “not sure” were excluded from this analysis. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 8

Organizations Engaging in Sustainable Workplace or Business Practices Comparisons by organization sector • Publicly owned for-profit organizations are more likely than privately owned for-profit organizations to engage in sustainable workplace or business practices. Comparisons by organization sector Publicly owned for-profit (83%) > Privately owned for-profit (67%) Comparisons by organization staff size • Organizations with 100 or more employees are more likely than organizations with 1 to 99 employees to engage in sustainable workplace or business practices. Comparisons by organization sector 100 to 499 employees (72%) 500 to 2, 499 employees (70%) 2, 500 to 24, 999 employees (86%) 25, 000 or more employees (86%) > 1 to 99 employees (49%) Note: Only statistically significant differences are shown. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 9

Drivers for the Investment in Sustainability Contribution to society (e. g. , good corporate citizenship) 39% 14% 12% Environmental considerations Health and safety considerations 10% 8% Saving money on operational costs 10% Local/federal regulations Public/media relations strategy 2% 5% 4% Competitive financial advantage 4% Employee activism 4% 4% 2012 (n = 392) 7% 13% 2010 (n = 411) Note: Excludes respondents whose organizations were not engaging in sustainable workplace or business practices. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 10

Methods Organization Use to Demonstrate Commitment to Sustainability 2012 (n = 279) 2010 (n =290) Sustainability is part of the organizational goals 58% 57% Information about sustainability efforts is included on the organization’s website 51% Information about sustainability efforts is included on the organization’s intranet 48% 52% 34% 25% 31% 12% 8% 6% 15% 16% 9% Methods Sustainability commitment is included in the organization’s mission Sustainability efforts are covered in the organization’s annual report The organization issues a report dedicated exclusively to sustainability Sustainability is linked to individual performance goals Sustainability seminars/training is mandatory Note: Percentages do not total 100% due to multiple response options. Excludes respondents whose organizations were not engaging in sustainable workplace or business practices. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 11

Types of Workplace Sustainability Policies 50% Formal policy 52% 42% Informal policy 39% 8% No policy 9% 2012 (n = 396) 2010 (n - 426) Note: Respondents who answered “not sure” and those whose organizations were not engaging in sustainable workplace or business practices were excluded from this analysis. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 12

Importance of Sustainability to Create a Positive Employer Brand that Attracts Top Talent 2012 (n = 370) 2010 (n = 381) 51% 49% Very important Important 39% 40% 11% 10% Unimportant or very unimportant Note: Respondents who answered “not sure” and those whose organizations were not engaging in sustainable workplace or business practices were excluded from this analysis. Sustainable Workplace Practices: How Has Sustainability Changed Over Time? ©SHRM 2013 13

Importance of Sustainability to Improve Employee Retention 2012 (n = 366) 2010 (n = 381) 40% Very important Important 46% 14% 45% 15% Unimportant or very unimportant Note: Respondents who answered “not sure” and those whose organizations were not engaging in sustainable workplace or business practices were excluded from this analysis. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 14

Importance of Sustainability to Develop the Organization’s Leaders 2012 (n = 361) 2010 (n = 375) 47% 36% 33% Very important 48% Important 18% 19% Unimportant or very unimportant Note: Respondents who answered “not sure” and those whose organizations were not engaging in sustainable workplace or business practices were excluded from this analysis. Sustainable Workplace Practices: How Has Sustainability Changed Over Time? ©SHRM 2013 15

Top 5 Methods of Involving or Engaging Employees in Volunteer Community Outreach Initiatives Related to Sustainability 2012 (n = 323) 2010 (n = 330) 1. Recognize employee participation in volunteer programs 62% 67% 2. Provide company-sponsored volunteer events during work hours 51% 45% 3. Provide company-sponsored volunteer events after work hours (e. g. , on weekends) 48% 4. Encourage senior management to participate in volunteer programs 48% 46% 5. Encourage employees to spearhead volunteer programs 43% 44% Methods Note: Percentages do not total 100% due to multiple response options. Excludes organizations not engaging in sustainable workplace or business practices. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 16

Participation in Socially Responsible Activities Related to Sustainability Activities Donate/collect money for local charities Support the community through company-sponsored volunteer projects Donate/collect money for natural disasters Consider the overall social impact of business decisions Partner with environmentally friendly suppliers/companies Monitor the impact of business on the environment Partner with women or minority-owned suppliers/companies Cause marketing/branding Monitor global fair labor standards/practices Track sources of global raw materials/suppliers 2012 (n = 385) 2010 (n = 410) 74% 77% 61% 54% 43% 30% 29% 21% 14% 10% 58% 47% 46% 35% 29% 17% 11% Note: Percentages do not total 100% due to multiple response options. Excludes organizations not engaging in sustainable workplace or business practices. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 17

Environmentally Responsible Practices that Support Organization’s Sustainable Workplace Initiatives Environmentally Responsible Practices Offering recycling program for office products Using virtual tools conduct meetings Using energy-efficient lighting systems and equipment Donating/discounting used office furniture Installing automatic shutoff for equipment Partnering with environmentally friendly suppliers/companies Minimizing water consumption by using water-conserving plumbing fixtures Using supplies and materials more efficiently Buying or leasing refurbished goods Encouraging employees to power down computers after few minutes of inactivity Promoting walking, biking, taking public transit instead of driving a vehicle Encouraging/promoting/providing car pooling for employees 2012 (n = 396) 86% 2010 (n = 364 -395) 86% 80% 69% 63% 54% 81% 69% 71% 58% 61% 49% 48% 53% 55% 59% 47% 58% 47% 41% 45% 49% Note: Percentages do not total 100% due to multiple response options. Excludes organizations not engaging in sustainable workplace or business practices. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 18

Environmentally Responsible Practices that Support Organization’s Sustainable Workplace Initiatives (cont. ) Environmentally Responsible Practices (cont. ) Offering employees telecommuting to reduce environmental impact of commuting Selected a location with public transit access Minimizing pollution Salvaging or reusing construction materials Offering incentives to employees for the use of mass transit Using recycled materials in the construction or remodeling of the building Buying hybrid vehicles for organization’s fleet Buying alternative energy Installing solar panels on roof Using a green or living roof Buying carbon offsets Establishing a community garden where employees can grow their own produce Offering incentives to employees for the purchase of hybrid vehicles 2012 (n = 396) 2010 (n = 364 -395) 38% 35% 32% 31% 26% 24% 15% 10% 8% 8% 6% 32% 46% 39% 26% 15% 11% 9% 4% 7% 7% 2% 4% 4% Note: Percentages do not total 100% due to multiple response options. Excludes organizations not engaging in sustainable workplace or business practices. 19 How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013

Organizations that Calculate a Return on Investment for Their Sustainability Efforts 37% Yes 39% 63% No 61% 2012 (n = 237) 2010 (n = 238) Note: Respondents who answered “not sure” and those whose organizations were not engaging in sustainable workplace or business practices were excluded from this analysis. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 20

Return on Investment for Sustainability Efforts 56% Calculated a positive ROI 47% 5% Calculated a break-even point Calculated a negative ROI 6% 1% 0% 39% Still too early to determine the ROI 2012 (n = 88) 46% 2010 (n = 93) Note: Excludes respondents whose organizations did not calculate a return on investment for their sustainability efforts and whose organizations were not engaging in sustainable workplace or business practices. Percentages do not total 100% due to rounding. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 21

Positive Outcomes of Sustainability Initiatives Positive outcomes Improved employee morale Stronger public image More efficient business processes Increased employee loyalty Position as an employer of choice Positive financial bottom line Increased brand recognition Increased consumer/customer confidence Increased employee retention Increased workforce productivity Increased recruitment of top employees Improved product portfolio 2012 (n = 352) 53% 51% 47% 32% 29% 27% 26% 25% 24% 16% 14% 6% 2010 (n = 343) 55% 43% 38% 27% 25% 34% 33% 21% 17% 13% Note: Percentages do not total 100% due to multiple response options. Excludes organizations not engaging in sustainable workplace or business practices. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 22

Green Jobs Definition For the purpose of this research, green jobs are defined as jobs that involve: Ø Reducing pollution or waste. Ø Reducing energy usage. Ø Reducing use of limited natural resources. Ø Protecting wildlife or ecosystems. Ø Lowering carbon emissions and developing alternative energy. These jobs primarily meet the need for more environmentally responsible production/work processes and the development of green goods and services. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 23

Is your organization currently focusing on creating green jobs or adding duties within existing or newly created jobs that can be considered green? Yes 20% No Plan to within the next 12 months 74% 6% Note: n = 595. Respondents who answered “not applicable” were excluded from this analysis. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 24

Has your organization’s focus on creating green jobs or adding duties within existing or newly created jobs that can be considered green increased, stayed the same or decreased in the last 12 months? Increased 49% Stayed the same Decreased 50% 1% Note: n = 106. Respondents who answered “not applicable” were excluded from this analysis. It also excludes respondents whose organizations were not focusing on creating green jobs or adding green duties within existing or newly created jobs. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 25

Has your organization’s focus on creating green jobs or adding duties within existing or newly created jobs that can be considered green increased, stayed the same or decreased in the last 2 years? Increased 74% Stayed the same Decreased 24% 2% Note: n = 95. Respondents who answered “not applicable” were excluded from this analysis. It also excludes respondents whose organizations were not focusing on creating green jobs or adding green duties within existing or newly created jobs. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 26

In the past 12 months, which of the following have taken place at your organization to meet the demands for more environmentally responsible production/ work processes or the development of “greener” ways of working? New green duties have been added to existing positions at my organization Increased staff levels (added more staff ) of existing jobs that already had green duties as part of the overall position Created completely new green positions OR added green duties within newly created jobs Yes 15% 6% 6% 85% 94% No Note: n = 690. Respondents who answered “not sure” were excluded from this analysis. Sustainable Workplace Practices: How Has Sustainability Changed Over Time? ©SHRM 2013 27

Organization Demographics 28

Demographics: Organization Staff Size 1 to 99 employees 18% 100 to 499 employees 28% 500 to 2, 499 employees 20% 2, 500 to 24, 999 employees 21% 25, 000 or more employees 13% n = 713 How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 29

Demographics: Organization Profit Status Privately owned for-profit 42% Nonprofit organization Publicly owned for-profit Government agency 29% 16% 14% n = 685. Percentages do not total 100% due to rounding. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 30

Demographics: Organization Industry Percentage Health care and social assistance Professional, scientific, and technical services Educational services Government agencies Manufacturing Finance and insurance Religious, grantmaking, civic, professional and similar organizations Administrative and support and waste management and remediation services Information Transportation and warehousing Accommodation and food services Arts, entertainment, and recreation Retail trade Construction Real estate and rental and leasing Repair and maintenance Agriculture, forestry, fishing and hunting Utilities Whole trade Mining Personal and laundry services 21% 19% 13% 13% 10% 6% 5% 5% 5% 4% 4% 4% 3% 3% 3% 2% 2% 2% 1% 1% Note: n = 683. Percentages do not equal 100% due to multiple response options. How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 31

Demographics: Other Does your organization have U. S. based operations (business units) only or does it operate multinationally? U. S. -based operations only 76% Multinational operations 24% Single-unit organization: An organization in which the location and the organization are one and the same. 30% Multi-unit organization: An organization that has more than one location. 70% n = 713 What is the HR department/function for which you responded throughout this survey? Corporate (companywide) 68% Business unit/division 17% Facility/location 15% n = 505 Is your organization a single-unit organization or a multiunit organization? For multi-unit organizations, are HR policies and practices determined by the multi-unit headquarters, by each work location or both? Multi-unit headquarters determines HR policies and practices 47% Each work location determines HR policies and practices 3% A combination of both the work location and the multi-unit headquarters determine HR policies and practices 50% Note: n = 505 How Have Sustainable Workplace Practices Changed Over Time? ©SHRM 2013 32

SHRM Survey Findings: How Have Sustainable Workplace Practices Changed Over Time? 2012 Survey Methodology • Response rate = 18% • 713 HR professional respondents from a randomly selected sample of SHRM’s membership participated in this survey • Margin of error +/- 3% • Survey fielded July 7 -August 7, 2012 Sustainable Workplace Practices: How Has Sustainability Changed Over Time? ©SHRM 2013 33

About SHRM Research • For more survey/poll findings, visit www. shrm. org/surveys • For more information about SHRM’s Customized Research Services, visit www. shrm. org/customizedresearch • Follow us on Twitter @SHRM_Research Project leader: Shawn Fegley, SPHR, survey research analyst, SHRM Research Project contributors: Mark Schmit, Ph. D. , SPHR, vice president, SHRM Foundation Alexander Alonso Ph. D. , SPHR, vice president, SHRM Research Evren Esen, manager, Survey Research Center, SHRM Research Copy editor: Katya Scanlan, SHRM Knowledge Center Sustainable Workplace Practices: How Has Sustainability Changed Over Time? ©SHRM 2013 34