Editor's Note: Strong Government/Business Partnerships Mitigate Location Risks
Economic development programs are evolving to help companies mitigate risks and boost their return on investment, while businesses are also placing increasing emphasis on environmental, social, and governance (ESG) issues.
Among the business dynamics that are shifting in a post-pandemic world are workplace norms, which now emphasize environmental, social, and governance (ESG) issues, including climate change, social equity, and business ethics. Goals are being established to reduce greenhouse gas emissions, support diversity and inclusion (D&I), engage with the community, prioritize employee safety and wellness, and more, according to Steve Tozier at EY.
Brooke Beebe, who is senior vice president of Advocacy and Engagement at Hemlock Semiconductor, says her firm has hired its first diversity and community liaison, as well as increased the number of women and non-white males in professional and technical roles.
Economic developers are also targeting their business attraction approaches to ensure they support these post-pandemic goals. And while the financial incentive programs that economic development departments are known for will remain a priority, these programs are evolving in order to help companies mitigate risk and boost their return on investment, according to those on the Business Incentives Practice team at Cushman & Wakefield.
Supply chain disruptions, a shortage of industrial real estate product, and hybrid employment models have increased site selection risks. Incentives are usually based on the capital investment and job creation numbers that a company has promised at the location of choice. However, a large capital investment for automation would reduce employee headcounts, and a hybrid or work-from-home scenario would do the same – both resulting in a company not qualifying for incentives. This is where a strong partnership between government and industry adds value by providing flexible incentive programs to accommodate projects varying in terms of scope and size.
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