IMPROVE GENDER EQUITY TO TRANSFORM THE ENERGY SECTOR
Lauren Davies & Nadine Amr, London - Mar 8, 2022
This year the International Women’s Day campaign theme is #BreakTheBias. The campaign encourages us to eradicate bias, negative stereotypes and discrimination and to promote diversity and inclusivity. Energy is among the industries that have the most work left to do to achieve gender equality; women are underrepresented throughout the sector. The International Energy Agency (IEA) reports that only 22% of the workforce in the traditional energy sector is female, compared with 48% of the global labour force. This percentage is even lower at management level. The energy sector is also currently experiencing a tremendous shake-up as we strive to meet the commitments outlined in the Paris Agreement. Women, as well as a diverse workforce, have a critical role to play in the transition to a low-carbon economy. In order to even come close to reaching those goals and commitments on time, the sector urgently needs fresh and diverse perspectives to spur the innovation required to power the energy evolution. It is vital that each participant in the energy and infrastructure industry uses the current momentum to revitalize the energy industry, and, in our view, improving the gender and diversity imbalance throughout the sector lies at the heart of this.
From national oil companies to international oil companies, supermajors, investors, insurers, financiers, consultants, governments and policymakers, players across the energy sector are investing in the energy transition more significantly and with more purpose than ever before. They are deploying substantial funds and resources towards research and development, devising and implementing sustainable practices and developing and deploying renewable and alternative energy initiatives. Failure to adapt will have repercussions for the mid- to long-term prospects of any player in the energy sector, as has been demonstrated by the increased pressure from activist shareholders. Returns from alternative energy projects are not as high as returns on traditional hydrocarbons investments have been, as the space is now rife with competition. Accordingly, not only does the transition to sustainable, affordable and secure energy require a shift in strategy and focus, but energy players need to consider the makeup of their workforce in order to get there. New technologies, business strategies and innovative solutions require creative, diverse, collaborative and intelligent thinking, particularly in order to scale-up, remain competitive and maintain dominance in this changing landscape.
Changes in Thinking
The energy sector cannot undergo a successful transformation without a change in thinking from the inside; the ability to garner diverse perspectives and continue to come up with novel solutions to the global energy problem must be achieved through a diverse workforce that possesses a range of talents and approaches. There are numerous studies, that go beyond the remit of this piece, which conclude that better gender equality and diversity results in economic and social benefits to all. The makeup — whether it be gender, race, class — of the decision-makers and innovators who are driving these fundamental changes needs to be a better representation of the underlying global population, while the same representation needs to exist at all levels in order for the industry to survive in the long term.
Participants within the energy sector also need to consider their ability to attract and retain talent and must remain conscious of the importance of gender and diversity reporting, as well as Gen Z (and even Gen Alpha) ideologies. As we have seen throughout the energy sector more generally, statistics and targets are becoming increasingly important, in particular when accessing capital and investment. Gender equality and diversity will have a significant role to play in those environmental, social and corporate governance and corporate social responsibility measures.
Room for Progress
As lawyers practicing in the energy sector, the authors of this article have a strong desire to see more women entering the profession and going on to hold senior positions across the industry. The energy industry is one of the most exciting and dynamic sectors that touches all aspects of the global economy and society, especially now while we have the unique opportunity to experience and work against the backdrop of the energy evolution. When advising clients in the energy sector, we have both regularly found ourselves as one of the few women at the negotiating table. Despite this, we are lucky that we have rarely felt singled out from our male peers, although we certainly have experienced bias at various points in our careers. While this is certainly changing gradually, and we are more recently seeing teams of advisers and clients increasingly represented by female and diverse professionals, we are acutely conscious that there is still a long way to go. Women remain underrepresented in the energy industry as a whole; while the percentage of women practicing law (including energy lawyers), prior to the partnership level, is higher than the industry average, it sharply nosedives thereafter, and many other women in the industry have unfortunately had very different and less positive experiences than those we have encountered.
An energy lawyer needs to demonstrate strong technical capability, sector knowledge, develop a strong reputation among peers and clients, build trust and deliver an excellent service, regardless of gender or other personal characteristics. As lawyers in the energy sector, we would not be where we are today without the guidance of the mentors that inspired us and shaped our careers, and we are privileged that those mentors include many women and lawyers and professionals from diverse backgrounds. We seek to mentor junior lawyers (and aspiring lawyers) in the hope of attracting them to the industry and nurturing their careers like our mentors did for us.
Consistent with the notion that the energy transition requires affirmative action from each participant across the energy value chain, the sector cannot achieve gender equality without positive support from the industry as a whole. This cannot happen overnight and to do this, we need to work collaboratively to make the energy sector an attractive, exciting and nurturing place for women and diverse professionals to work and we need to make sure that they can find the right role models to inspire them. Participants in the energy sector can start by training teams to identify their own gender biases, actively recruit, promote and retain female and diverse talent, foster inclusive work environments and increase awareness in education and society as to the potential opportunities for women and diversity in the energy sector.
We believe that participants in the energy sector should be using the momentum of the all-important work of solving the energy problem and achieving a sustainable, low-carbon economy to effect positive change across the industry in order to level the playing field. Let’s work together to eradicate bias and improve gender equity and diversity within the energy sector.
Lauren Davies is a Partner and Nadine Amr is a Senior Associate at Vinson & Elkins. The views expressed in this article are those of the authors.