In a significant shift, the financial industry is now offering higher pay for roles tied to Environmental, Social, and Governance (ESG) principles, with some positions commanding up to 20% more in compensation compared to non-ESG roles. This transformation is a stark contrast to just a few years ago when ESG job titles were associated with slightly lower average pay. Revelio Labs' data analysis shows that ESG hiring experienced a significant surge in mid-2020 and early 2021 but has since slowed down.
What's noteworthy is that the increase in pay for ESG roles isn't solely due to regulatory compliance. Rather, it aligns with the growing demand for ESG-related products and services. Intriguingly, despite the higher compensation, the majority of new hires in the ESG sector are taking on junior-level positions. While this could be seen as a cost-saving strategy, it's important to note that professionals in ESG roles tend to have longer tenures than their counterparts in traditional non-ESG positions.
To delve deeper into these trends, consider the data: from early 2019 to March 2023, average pay for non-ESG roles increased from less than $85,000 to about $90,000. In contrast, pay for roles with "ESG" or "sustainability" in their titles soared from around $75,000 to nearly $110,000. The data also shows that demand for ESG roles surged from just over 0.01% of job postings in early 2019 to over 0.09% by mid-2020, gradually settling at about 0.04% by March 2023.
Resource:
https://www.investmentnews.com/esg-jobs-in-finance-come-with-a-bigger-paycheck-data-show237815#:~:text=Some%20roles%20pay%20much%20more,)%2C%20the%20ZipRecruiter%20data%20show.