Every business is deeply intertwined with ESG concerns. It makes sense, therefore, that a strong ESG proposition can create value. ESG stands for Environmental, Social, and Governance. ESG refers to the aspects of investing that are sustainable, responsible, or ethical. It’s a system for assessing a company’s or investment’s long-term viability in three areas: environmental, social, and governance.

Environmental criteria

This includes the energy your organisation consumes and the garbage it produces, as well as the resources it requires and the effects for living beings. Last but not least, carbon emissions and climate change are included in this criteria. Every business consumes energy and resources; every business influences and is influenced by the environment.

Social criteria

Discusses your company’s relationships and reputation with individuals and institutions in the communities where you do business. It also covers labour relations, diversity, and inclusion. Every business functions in a larger, more diversified society.

Governance Criteria

It is your company’s internal system of practices, controls, and processes for governing itself, making successful choices, adhering to the law, and meeting the needs of external stakeholders. Every legal entity, even a corporation, requires governance.

Environmental factors look at the conservation of the natural world, social factors examine how a company treats people both inside and outside the company and governance factors consider how a company is run.

Socially responsible investing, ethical investing, sustainable investing and impact investing are more general terms.

Why is ESG Important?

Any business’s environmental, social, and governance concerns are inextricably interwoven. Because it is considered as a strategy to protect businesses from future hazards, ESG has grown in relevance among investors, legislators, and other key stakeholders.

• A good and relevant ESG programme can provide benefits both internally and externally by setting a vision for an organisation’s environmental and societal influence.
• Setting environmental goals can help you minimise your carbon footprint, decide your sourcing strategy, and lay the groundwork for reducing waste. You can create a meaningful diversity programme, improve employee wellness, and make long-term changes in your community using a social impact perspective.
• You can also diversify your board, improve company ethics, increase stakeholder openness, and protect privacy by establishing a robust governance framework.

ESG Consulting

ESG consulting is the process of discovering any investment opportunities in a company’s portfolio as well as divesting from those that are not ecologically or socially responsible. Sustainable Investing encompasses this concept. Sorditcon is India’s first ESG consulting company that helps businesses and investors to identify what impact they have on society and the environment. Sorditcon informs their clients how much their investment is worth in different currencies by taking into consideration ethical impacts.

ESG Reporting

A corporation or organisation’s environmental, social, and governance (ESG) implications are detailed in an ESG report. It allows the business to be more open about the threats and opportunities it confronts. It is a communication tool that is crucial in persuading sceptics that the company’s efforts are genuine. ESG reporting includes both qualitative and quantitative measures that are used to assess a company’s performance in relation to ESG risks, opportunities, and initiatives.