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| DELIVERING ON DIVERSITY, GENDER EQUALITY, AND INCLUSION | | | In this issue, we look at what the EU’s net-zero pledge will mean for low-income families and at the kind of expertise that board members need to help elevate Black women in corporate America. | | | | Europe has already set out to become the world's first climate-neutral continent by 2050—and all EU member states have committed to cutting the bloc’s emissions by at least 55 percent by 2030 (compared with 1990 levels). But what will the European Green Deal mean for Europe's low-income families? | | Many, it turns out, may financially benefit. McKinsey analysis shows that on a societally cost-optimal pathway to net zero, low-income households in lower-income European countries like Romania, Hungary, and Poland would actually see their expenses go down. On the whole, the cost of living would slightly decrease for Europe’s middle- and lower-income households, while high-income households would see no significant change. | | Broadly speaking, if consumption patterns remain the same and the cost increases and savings of decarbonization are directly passed through to consumers, the aggregate cost of living for an average household in a climate-neutral European Union would be roughly the same as today. What's the breakdown? Power and heating/cooling bills would be somewhat lower, thanks to more energy-efficient buildings, and mobility would ultimately be more affordable, while the cost of food and air travel would increase. | | What about all of the other low-carbon goods and services? It's worth noting that cost increases due to decarbonization are often much higher for intermediate rather than final products. The cost of steel, for example, may rise by 25 percent, but the price of a car produced with that steel would increase by less than 1 percent. | | The upshot is that the EU could achieve net-zero emissions at a net-zero cost—with benefits extending far beyond its borders. | | | It’s been 20 years since Ella Bell Smith, a professor of management at the Tuck School of Business, published Our Separate Ways: Black and White Women and the Struggle for Professional Identity with coauthor Stella M. Nkomo. Yet on the occasion of the book’s rerelease, Professor Smith reports very little progress in the advancement of Black and Brown women—and women in general—in corporate America. Companies are not developing women of color, Smith says, or elevating them to positions that would put them in contention for high-profile, revenue-earning jobs. Much of this reality is reflected in McKinsey’s latest Women in the Workplace report (developed in collaboration with LeanIn.Org), which found that women of color lose ground compared with White women and men of color (as well as White men) at every step in the corporate pipeline. What’s more, even after a year of increased focus on racial equity, women of color continue to have worse experiences at work: they report similar types and frequencies of microaggressions as they did two years ago. The growing societal discourse around inclusion and equity makes Smith hopeful, but she says companies must go beyond awareness and relationship building. Radical, sustainable change relies on a reexamination of the corporate systems in place and on leaders (board members, in particular) who have inclusion expertise and can foster trust, systemic equity, and a sense of belonging throughout a company. | | | — Edited by Daniella Seiler, a senior editor in McKinsey’s New York office | | Did you enjoy this newsletter? Forward it to colleagues and friends so they can subscribe too.
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