LOS ANGELES, May 19, 2021 – Amid the increase in awareness on the issues of diversity, equity and inclusion (DE&I) during the past year, a new Korn Ferry (NYSE: KFY) survey finds a small number of retailers are beginning to include DE&I incentive metrics in their compensation plans.

Of the more than 50 major U.S. retailers surveyed, only 9 percent say DE&I metrics are included as part of their compensation packages, and a mere 3 percent say they include environmental, social and governance (ESG) metrics that are not focused on DE&I. However, almost no retailers used these metrics just two years ago.

“Retail consumers are incredibly diverse, with buying power that equates to trillions of dollars. It is critical that companies recognize this and consider linking executive compensation to performance metrics that go beyond traditional measures of profit and shareholder value,” said Korn Ferry Senior Client Partner and retail expert Craig Rowley. “New metrics tied to diversity and inclusion and related ESG priorities better reflect emerging priorities for their customers and the world around them.”

Hiring in general continues to be a pain point for retailers. Nearly all (94 percent) say they are having difficulty filling vacant roles, with 32 percent saying they are facing significant challenges. Nearly a third (32 percent) say they have implemented a referral program to help in hiring, and 29 percent say they are offering sign-on bonuses.

“Retail hiring is intensely competitive today, and to win the war for talent, companies must create a positive employer brand that is genuine and consistent for all employees,” said Rowley. “Right now in the U.S. there are an inordinate amount of job openings overall, so retailers have to be creative in how they attract and retain talent.”

Despite the issues facing the retail industry, there is bright news. Eighty percent of respondents say they expect a rise in sales in 2021 and nearly two-thirds (62 percent) believe fall sales will be higher than spring sales.  

“We’re turning the corner and retailers are no doubt very anxious to put this difficult period behind them,” said Rowley.

Survey Results

Does your company have ESG metrics in its incentive plan?

Yes                                                                              9 percent

No but considering for future                                      38 percent

No                                                                               53 percent

Does your company have ESG (excluding DE&I metrics) in its incentive plan?

Yes                                                                              3 percent

No but considering for the future                                28 percent

No                                                                               69 percent

What is your anticipated sales growth for 2021?

Up 10 percent or more                                               16 percent

Up 5-9 percent                                                            29 percent

Up 3-4 percent                                                            22 percent

Up 1-2 percent                                                            13 percent

Flat                                                                              7 percent

Down 1-2 percent                                                       5 percent

Down 3-4 percent                                                       4 percent

Down 5-9 percent                                                       1 percent

Down 10 percent or more                                           2 percent

What is your forecast for fall performance?

Significantly worse than spring                                   2 percent

Somewhat worse than spring                                     9 percent

Similar to spring                                                          27 percent

Somewhat higher than spring                                     50 percent

Significantly higher than spring                                  12 percent

Are you having trouble hiring store employees?

Yes, significant challenges                                         32 percent

Yes, moderate challenges                                          29 percent

Yes, minor challenges                                                32 percent

No                                                                              6 percent

Are you doing anything new or different to attract and retain store employees?

No, not having trouble                                                  6 percent

No, have challenges but not taking actions               44 percent

Yes, special incentive plans                                       21 percent

Yes, sign-on bonuses                                                 29 percent

Yes, increase raise frequency                                   9 percent

Yes, referral programs                                                32 percent

About the survey

The Korn Ferry survey of more than 50 major U.S. retailers, with annual revenues between $50 million to more than $20 billion, took place in Late April 2021.                                    

About Korn Ferry

Korn Ferry is a global organizational consulting firm. We work with our clients to design optimal organization structures, roles, and responsibilities. We help them hire the right people and advise them on how to reward and motivate their workforce while developing professionals as they navigate and advance their careers.

Media Contact:

Tracy Kurschner

Tracy.kurschner@kornferry.com

612.309.3957