ESG (Environmental, Social, Governance)

ESG stands for environmental, social and governance. These are called pillars in ESG frameworks and are used to evaluate the sustainability and ethical impact of an investment in a company. They are the main topic areas that companies are expected to report in. Here’s a summarized breakdown of each:

• Environmental (E): captures energy efficiencies, carbon footprints, greenhouse gas emissions, deforestation, biodiversity, climate change and pollution mitigation, waste management and water usage.
• Social (S): covers labor standards, wages and benefits, workplace and board diversity, racial justice, pay equity, human rights, talent management, community relations, privacy and data protection, health and safety, supply-chain management and other human capital and social justice issues.
• Governance (G): covers the governing of the “E” and “S” categories; board diversity, executive compensation, shareholder rights, transparency, and ethical business leadership practices, anti-bribery and corruption.