WHAT IS ESG?
Environment
The "E" in ESG stands for Environmental. This refers to the environmental impact and sustainability practices of a company or investment. It considers the impact that the organisation has on the natural environment, such as its carbon footprint, water usage, waste generation, and use of natural resources.
Environmental issues are becoming increasingly important to investors, governments, and consumers, as they recognize the urgency of addressing climate change and protecting the planet.
Social
The "S" in ESG stands for Social. This refers to the social impact and practices of a company or investment. It considers the company's impact on society, including issues such as labor practices, human rights, community relations, diversity and inclusion, and consumer protection.
Social issues are important because they can impact a company's reputation, employee morale, and customer loyalty.
Governance
The "G" in ESG stands for Governance. This refers to the way a company or investment is governed, managed, and controlled. It includes issues such as executive compensation, board composition and diversity, shareholder rights, and transparency in financial reporting.
Good corporate governance is important because it can help ensure that companies are managed in a responsible and ethical manner