What Is ESG?

What Is ESG?

ESG stands for Environmental, Social and Governance – these three factors make up the criteria investors consider when measuring a company’s sustainability and ethical impact.

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ESG criteria include a company’s positions and positive impact on things like climate change, carbon emissions, water use, conservation, anti-corruption, board member diversity, human rights, and community development.

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Environmental criteria measure how a company performs as a steward of the environment through its energy use, waste generation, pollution, natural resource conservation and treatment of animals.

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Social criteria looks at how a company treats its employees, suppliers, customers and communities.

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Governance criteria considers how a company conducts its business and encompasses its leadership, executive pay, audits, internal controls and shareholder rights.