How ESG is shaping a just transition: Focusing on the society dimension in large-scale renewable projects

The global energy transition isn’t just a vision for the future — it’s unfolding right now, and it's happening faster than we ever thought possible. Renewable energy is swiftly becoming the foundation of future economies, opening up new job opportunities, empowering communities, and playing a vital role in protecting our planet.

In 2023 alone, renewable energy jobs reached 16.2 million globally, marking the most significant annual increase on record and an 18% growth in just one year. Nearly half of these jobs were in solar PV, employing 7.1 million people, with hydropower and wind supporting 2.3 million and 1.5 million jobs respectively. The shift is worldwide — China alone accounts for 7.4 million jobs, while the European Union has 1.8 million, Brazil has 1.56 million, and both the United States and India each have around 1 million. However, the benefits are not evenly distributed: the ILO highlights that Africa has only 324,000 renewable energy jobs, emphasising the urgent need for this transition to be not only environmentally sustainable but also fair and inclusive.

The real challenge isn’t only about reducing emissions; it’s about ensuring that communities, workers, and societies are warmly at the heart of this historical shift.

The overlooked “S” in ESG

ESG (Environmental, Social, and Governance) frameworks have emerged as a key means of measuring the sustainability of investments. Environmental and governance issues often take the spotlight, while the social side — the “S” — gets less attention. That’s a problem we can’t afford to ignore. Large renewable projects can bring huge benefits, like new jobs and stronger communities — but if social issues aren’t handled carefully, they can also spark conflict. Land acquisition, displacement, and unequal distribution of benefits can threaten both local development goals and the long-term success of projects.

Building fair, collaborative partnerships

By analyzing projects worldwide, clear lessons emerge about what works. Communities involved from the earliest stages are more likely to embrace projects and see lasting benefits. Skills development provides local employment and empowers communities to manage and maintain renewable energy systems. Participatory governance builds trust through open dialogue and shared decision-making, preventing misunderstandings that could derail projects. 

The message is clear: renewable energy can only deliver on its promise if we build fair, collaborative partnerships. Governments, investors, financial institutions, and local communities must collaborate to design projects that not only reduce emissions but also empower people.

The role of RES4Africa Foundation in a just transition

RES4Africa Foundation, with support from Enel Foundation as Knowledge Partner, developed the new policy brief How ESG is Shaping a Just Transition - Focusing on the Society Dimension in Large-Scale Renewable Projects. It focuses on the social aspect of ESG in renewable energy investments, emphasising community engagement and local development. By analysing fourteen projects worldwide — including some key examples in North Africa — the study demonstrates how inclusive planning, skills training, and participatory governance can foster trust, reduce conflict, and empower communities.

Africa’s opportunity to lead 

Africa has a special chance to set a positive example. When we prioritise fairness in energy investments, we can foster a transition that is both environmentally friendly and equitable — ensuring every community is included. The moment to take action is now, and the positive impacts of doing so will be felt for generations to come.

illuminem Voices is a democratic space presenting the thoughts and opinions of leading Sustainability & Energy writers, their opinions do not necessarily represent those of illuminem.

Track the real‑world impact behind the sustainability headlines. illuminem's Data Hub™ offers transparent performance data and climate targets of companies driving the transition.