What is ESG?
ESG (Environmental, social and governance) criteria increase interest to companies, their investors and other stakeholders. With growing concern about the ethical status of quoted companies, these standards are the central factors that measure the ethical impact and sustainability of investment in a company.
In less than 20 years, the ESG movement has grown from a corporate social responsibility initiative launched by the United Nations into a global phenomenon representing more than US$30 trillion in assets under management. According to Juliet Chung and Dave Michaels, “ESG Funds Draw SEC Scrutiny”, Wall Street Journal in the year 2019 alone, a surge of capital totalling US$17.67 billion flowed into ESG-linked products, an almost 525 per cent increase from 2015.
ESG factors cover a wide spectrum of issues that have traditionally been excluded from financial analysis:
Environmental:
- Climate change
- Resource depletion
- Waste and pollution
- Deforestation
Social:
- Working conditions, including the use of child labour
- Local communities
- Conflict
- Health and safety
- Employee relations and diversity
Governance:
- Executive pay
- Corruption
- Political affiliations and donations
- Board composition, diversity and structure
- Tax strategy
These factors have increasing financial relevance as global interest in ethical investment grows.
Meeting the ESG Imperative
Increase your shareholder engagement with Corporate Governance Solutions like ABAC Group™’s ISO certification or our brand parent’s DueDiligence360™ service.
An organization’s ESG strategy can be augmented and advanced through ISO Certification and the implementation of an individual or integrated management systems. For example, a sustainable business process framework might include ISO 37001: 2016 Anti-Bribery Management System standard. This standard provides a framework for implementing reasonable and proportionate measures to prevent bribery and corruption.
ISO 37001 isn’t the only standard that addresses these risks; take ISO 37301:2021 Compliance Management Systems. CMS helps organizations to comply with the legislation that is applicable to them and with the commitments assumed by their stakeholders. They undoubtedly help to create a culture of integrity and compliance that fosters sustained success and the organization’s survival.
One of the many benefits of ISO certification is that it is designed to fit together like a puzzle. If you are certified under, for example, ISO 37000:2021 Governance of Organizations, you will be familiar with ISO 37002:2021 Whistleblowing Management Systems. All ISO standards have in common their ability to help organizations achieve greater profits by managing the processes.
Have confidence in your decisions when selecting your business partners, customers and workforce. Our parent’s brand due diligence reports provide research and insights from financial to legal and reputational standing. CRI™ unique identity and vision evolved from our fundamental desire to support our clients and their candidates. Safeguard your business and its integrity with DueDiligence360™.
CRI™ Corporate Accountability exposes vulnerabilities and threats that can cause serious damage to your organisation and can significantly reduce business. CRI™ is trusted by the world’s largest corporations and consultancies. Outsource your corporate due diligence process to an experienced provider and you will only ever have to look forward, never back.
