Environmental, Social, and Governance (ESG) is a strategic framework for identifying, assessing, and addressing organizational objectives, activities, risks, and opportunities related to environmental, social, and governance. It is an organizational concept that has become increasingly important, especially considering the rise of sustainable investment and investors that solely want to invest in companies that have a high ESG score.
In most countries, governments are introducing or continue to introduce regulations aimed towards enhancing the environmental, societal, and governance-related issues, but ESG remains a voluntary initiative for organizations and companies. However, almost all large organizations in recent years have taken very direct steps towards institutionalizing ESG frameworks voluntarily within their own organizations, and it is likely that governments will introduce corporate mandatory boundaries related to ESG in the near future.
The ESG Framework is structured on 3 pillars:
1. The Environmental Pillar – where the organization’s focus is aimed towards the reduction of its carbon footprint and negative environmental impacts (such as electricity usage management, water usage management, waste management – re-use, recycle, reduce, decreasing noise pollution, among other initiatives).
2. The Social Pillar – where the organization focuses on supporting its employees, its stakeholders, and the community where it operates (including initiatives related to diversity, income equality, employee wellbeing, CSR initiatives, and labor wellbeing).
3. The Governance Pillar – where the organization aims to enhance and elevate its current governance standards through maximum accountability, transparency and reporting aiming towards greater long-term trust with all stakeholders.
Learn more about ESG and ESG reporting, its relevant standards, best practices, and COP 28, in our upcoming “ESG Assessment, Implementation, and Reporting” Course in January 30-31, 2023. Click here to register and to get more information.