ESG Explained! What ESG Stands for and Why It Matters!
Environmental (E):
The environmental aspect of ESG evaluates a company’s impact on the planet. This includes efforts to reduce and minimize environmental risks associated with business operations.
Social (S):
The social component assesses a company’s relationships with its employees, communities, and broader society. It encompasses factors such as diversity and inclusion, employee well-being, community engagement, and contributions to social causes.
Governance (G):
Governance focuses on the structure and practices that guide a company’s decision-making processes. This includes the effectiveness of the board of directors, ethical business conduct, transparency, and adherence to legal and regulatory requirements.