Can Diversity Contribute to Advancements in Energy?
By Osasu Eghobamien
I wonder what runs through the minds of people today when they come across the fact that whale oil once used to be the most priced energy source for heating and lighting. What is even whale oil, right? It makes one realise how quickly energy and energy technology have evolved over the last five to six centuries. Whale oil used to be the “in-thing” in the 16th to 19th centuries before it was almost suddenly replaced by petroleum in the 1860s. Petroleum and its various constituents including, coal and kerosene, contributed significantly to world industrialisation, and the beginning of globalization as we know it today.
Today, the world has revolutionized to the point where it sees the use of petroleum for energy as causing more harm than good. Now, renewable energy use and zero coal targets are being pursued globally and within individual countries; and with such targets come the need for more rapid, sustainable innovations. Continuous innovation is necessary to keep up with ever-evolving advancement of research, development, demonstration, and deployment of energy technology. Some of these advancements are in energy efficiency, energy storage, smart grids, transmission systems, and payment systems.
What does diversity have to do with advancements in energy technology? One might ask. Does accelerating diversity and inclusion in the energy industry contribute to accelerating innovation and utilities? Let me point out that diversity, in this context, goes far beyond gender, to include age, race, geography and a contingent workforce.
Yes, Diversity contributes to Advancements in Energy
Research suggests that diversity and inclusion is a strong catalyst to accelerating innovation in energy. A study by the Center for Talent Innovation found that companies with diversity are 70% more likely to capture new markets and 75% more likely to get innovative ideas to market. Evidence also suggests diversity leads to improved outcomes; even profitability! A recent study by the Boston Consulting Group (BCG) which analysed 1,700 different companies across eight countries, revealed that companies that have more diverse management teams have 19% more revenue due to innovation.
But, how does gender diversity help innovation in energy?
Decision making drives everything else when it comes to research, innovation, and development; and the energy sector is not left out of this fact. With diversity comes better decisions and increased adaptation to change – qualities necessary in innovation and technology advancement. This is because diversity comes with a better quality exchange of ideas, greater level of expertise, different ways of thinking and more out-of-the-box reasoning, new skills, perspectives, and better talent. Cloverpop carried out a study of 588 actual business decisions made by 184 teams in a wide variety of companies over 2 years. The study revealed that teams make better decisions than individuals 66 percent of the time, and 87 percent of the time when diversity (including, age, geography, and gender) was added to the equation.
What Should Energy Companies Do?
The fact is today, many energy companies that have failed to embrace diversity need to step up their game. For instance, women in energy take up a smaller share of the workforce than in almost all other sectors. Therefore, in the hiring and retention of talents, energy companies should take a critical look at the diversity of their workforce. It is, however, not enough to hire diversity but to ensure that there is a culture of inclusion in the workplace.
In order to sustain diversity, energy companies must do away with laws and socio-cultural norms that discriminate, perform human rights due diligence, enable diversity policies, provide opportunities to train and develop, and enable diversity policies. In the end, the results in terms of innovation and revenue would surely reflect these efforts.
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