ESG stands for Environmental, Social, and Governance.

• Environmental: This refers to an organisation’s impact on the planet, including factors like carbon emissions, resource usage, and environmental conservation efforts.
• Social: This pertains to an organisation’s impact on people, encompassing its interactions with employees, customers, communities, and broader societal welfare.
• Governance: This concerns how an organisation is governed and managed, focusing on aspects like transparency, ethics, and accountability.

ESG takes a holistic view of sustainability, recognising that it extends beyond just environmental concerns to include social and governance factors.

ESG is important because:

• It helps investors identify well-managed and sustainable companies, reducing investment risks and promoting long-term value creation.
• It encourages companies to adopt responsible business practices, leading to positive societal and environmental impacts.
• It enhances transparency, accountability, and trust between companies and their stakeholders.

No, ESG is focused on managing risk and compliance, whereas social value encompasses broader societal impacts and aims to create additional value beyond risk mitigation.

• Sustainability reporting: Focuses on a company’s overall sustainability performance, including environmental, social, and economic aspects. It typically covers a broader range of topics beyond ESG criteria.
• ESG reporting: Specifically focuses on Environmental, Social, and Governance criteria used to evaluate a company’s sustainability and ethical practices. It may be a subset of sustainability reporting, emphasising these specific areas.