ESG Background and Imperatives
Last Updated: November 3, 2021| 1 min
Environmental, social, and governance (ESG) identifies and measures the impact of an organization’s policies and procedures in the areas of the environment, social, and governance, which may impact their brand, revenue, company valuation, and market perception, and reduces risk. Publishing ESG reports is becoming more important as customers, employees, and investors want to know what your impact is in these areas. But ESG reporting and programs are very new to many companies and very complex.
ESG reports are typically defined from metrics in the areas of environmental, social, and governance. What do these include?
The Environmental component of ESG addresses the impact and the footprint of an organization on the external environment. These criteria are increasingly looked out by investors and capital markets in their evaluations of companies, who take them into account when assessing their internal policies and managing environmental factors.
The environmental criteria within ESG considers a wide variety of factors. Organizations looking to address these criteria build, enable and maintain policies around issues such as:
- energy use
- waste and resource management
- carbon emissions and climate change
- natural resource conservation
- animal treatment
- sustainable use of land, plastics, and water
- the consequences of all this for living beings