April 2021
Why It’s Time for More Employer Branding
in "Developing" Countries
Employer brand represents an organization’s reputation as a place to work. It’s based on an Employee Value Proposition (EVP), which is the sum of offerings the organization can provide in return for the skills of the talent it employs. Once an organization’s employer brand is established, traditional branding and marketing activities then follow to ensure the brand is known and perceived as attractive among employees and potential candidates.
In general, formal employer branding remains a fairly new field, starting to only pick up momentum in the early 2000s. Two decades later, however, one noticeable and concerning observation is the unequal distribution of employer brand prioritization and investment around the world.
The trend is that we see the strongest employer brands from organizations whose headquarters are in countries with advanced economies (often referred to interchangeably as “HICs”, or “high-income countries”). This includes the strength and perception of those brands in both economically advanced and economically developing countries (often referred to interchangeably as “LMICs”, or “low- and middle-income countries”). Does this mean that there aren’t great places to work whose headquarters are in economically developing countries? Absolutely not, but there are some factors that come into play why this trend appears:
Naturally, the countries with the comparatively advanced economies have flourished for longer due to a wide range or historical, political, civil, and legislative reasons, so they have had a head start. However, nearly all of the world’s emerging markets are currently located in low- and middle-income countries. This presents a tremendous opportunity for organizations headquartered in these countries, as well as organizations with entities there. These organizations can also ensure that they have equal employee working conditions as those in high-income countries with advanced infrastructures as a foundation to retain and attract talent. This, of course, can even lead to greater societal demand and faster changes than local or national governments would ordinarily implement.
Employer Branding Landscape in Emerging Markets:
If we take a look at Universum’s 2020 “Top 50 Most Attractive Employers” among business, IT, and engineering students entering the workforce, only one employer is headquartered in a BRICS (Brazil, Russia, India, China, South Africa) emerging market. When taking a more detailed look into the attractiveness of the top 10 employers in other emerging markets, typically less than half of those employers are actually headquartered in that same country:
Furthermore, of those locally headquartered organizations in those selected countries, the average combined Glassdoor rating of the top three is a 3.8, while the same average among organizations headquartered in high-income countries like the U.S., Canada, Germany, the U.K., France, South Korea, and Australia is a solid 4.0.
Of the companies in BRICS countries that have been recognized with prestigious employer awards, only 16% have their headquarters in that country, with most being in South Africa or Brazil. That number slips to almost 0% in the rest of the world’s developing economies. “Global” employer awards are simply too expensive or are funded by international corporations whose headquarters are abroad, further causing high disparity among the recognition of the world’s employer brands.
Despite this, there’s tremendous opportunity in the world’s most emerging markets. Looking at the rate of business start-ups among the leading economic nations in 2019, India and Brazil came in at third and fourth, and India alone accounts for over 63 million small and medium-sized businesses.
Challenges in Economically Developing Countries:
Some of the challenges that employees face in many economically developing countries include available opportunities, salary levels, ease of doing business, and the government’s protection of workers’ rights. People in these countries looking for jobs will frequently think of the big international corporations or even resort to emigrating for better working conditions. The latter can result in “brain drain”, which is a serious problem that disproportionately affects economically developing countries.
While human migration does have proven positive outcomes, and may be influenced by serious needs, such as danger, persecution, or lack of opportunity or basic freedoms, the talent that contributes to the diversity of thought and experience in the new country only further supports the success of the organization in the new country, while families in the home country typically rely on remittances that have been received from abroad.
This actually allows for ripe territory for employers to lead the way for progress in their countries. Employers can easily take a grassroots approach to pave the way for fair remuneration, minimum wages, career development opportunities, and a dignified and respectful working environment faster than governments.
Conclusions:
All this employer “branding” is great but where does it start? By offering a world-class style “product” – that is your place of work. This entails all of your working conditions and offerings therein: your talent acquisition process, your onboarding experience, your career development possibilities, communication and transparency, your employees’ well-being, and even your CSR strategy for how you give back to your community. Improving these conditions will always be the first step.
It’s important for managers of organizations in emerging markets to adapt an approach that an investment in employer branding saves on talent acquisition costs later, speeds up the recruitment pipeline, and increases employee productivity when the workplace conditions are good. It’s also important to understand that an investment in improving workplace conditions and subsequent employer branding contribute to an interconnected change inside the workplace and in the wider society. After these changes take place, a further obstacle that must be overcome is to promote it, especially in societies that traditionally admire humility and where any sort of self-promotion doesn’t come naturally.
By prioritizing employer branding in emerging markets and in countries with developing economies, it’s a step to end the unequal globalized hunt for talent. It’s also the duty of HR and management to consider what responsibility and influence they have to change working conditions in their countries and pave the way for larger progress.