Note: This post first appeared in abbreviated form on the website of The National on 20 November 2018.
The issue of how to attract and retain young talent—and women especially—is becoming an increasingly serious concern for oil and gas companies; older employees are retiring but then having to return as consultants because their companies are struggling to draw in new hires. And this is not just a problem in the West, where demographics are a factor – even in regions with a high proportion of well-educated youth, like MENA, many younger people do not see the oil and gas sector as attractive.
This was a focus at last week’s Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC), which more broadly explored diversity and inclusion in a famously conservative sector.
Of course, this year’s ADIPEC took place in the shadow of the recent report by the UN’s Intergovernmental Panel on Climate Change on the probability of keeping the global temperature rise under 1.5oC. That report stated that humankind could exceed the 1.5oC “guard rail” as soon as 2030, and avoiding that dangerous limit will require “rapid, far-reaching and unprecedented changes in all aspects of society.” The authors suggested that renewables should comprise 85 percent of the energy sector by 2050.
This industry then, more than most, needs to reform, and for that it needs young people with new ideas and creativity. But young people increasingly want their professional lives to be consistent with their values; they want to make a positive difference to their societies.
One key reform that oil and gas companies must make – in order to align themselves with the values of the young people they need to recruit – is to fundamentally overhaul their approach to diversity and inclusion, confronting longstanding gender imbalances and opening up the sector to women. Not only are younger people – both women and men – put off by the lingering sexism that is still too often a hallmark of oil and gas company culture, but of course women make up a significant and increasing proportion of the young talent that oil and gas companies need to attract.
A 2017 study by the World Petroleum Council and the Boston Consulting Group found that MENA was the region with the highest proportion of women pursuing qualifications in science, technology, engineering and mathematics (or STEM). Almost 40 percent of those studying STEM in MENA are women, compared to just 21 percent in the US and 24 percent in Europe.
One barrier is the industry’s poor reputation when it comes to women’s prospects for promotion. Very few women reach senior positions in the industry. These issues are well documented, but old attitudes and lethargy hold the sector back.
Younger women and men also want different things from their professional lives. I heard from participants at the conference that there is a need for more flexibility in the workplace; work-life balance should not be taboo anymore. Women and men should be able to ask for flexibility without thinking that it will affect their position in a company.
Being able to use their creativity is also important to younger employees. Status may not be as valuable as the chance to engage their talents in problem solving. As a sector grappling with a host of challenges – social and environmental, sustainability, renewables and volatility – the oil and gas industry needs this innovation.
But hydrocarbon companies must do more to enable this. Young people can find the industry’s corporate culture stultifying. One participant in a roundtable I moderated said that a young talent advising a seasoned manager on new approaches typically requires hours of communication and learning to create productive space for dialogue. There is still a resistance to new ideas.
The UAE has made recent moves toward diversification—ADNOC has had two women CEOs and increased its percentage of female employees. One lesson here was that genuine C-suite leadership is essential to affecting real change. Only when leadership understands the need to attract more women to the sector are crucial steps taken. There is still a lack of will in this regard at the top of many companies.
But there signs of progress. Norway’s Statoil made a major commitment to transformation and even changed its name to Equinor to underline its commitment to become something new. A company that cares about people’s wellbeing will be attractive to young talents.
All industries need new blood and new thinking. However, the oil and gas industry may be in a catch-22: in order to attract young people it needs to fundamentally transform and show itself as a sector that can make a positive contribution without causing harm. But the very people likely to help the industry overcome its poor reputation are the same people who generally still aren’t interested in joining. Strong senior leadership and real culture change – not just slick PR – are needed if the oil and gas companies of the 20th century are going to transform into the responsible energy sector that the 21st century needs.
Laury Haytayan is the MENA director at the Natural Resource Governance Institute.