What is ESG?
ESG is a framework that helps and enables both stakeholders and shareholders to understand how an organization or a company is managing risks and opportunities related to environment, society and governance. It acknowledges that the effect a business has on its community and surroundings in a wider sense is not only financial, but also environmental and society-related and measures this impact. Only by taking these aspects in consideration in their day to day operations and being conscious about the nature and degree of impact they generate in that respect, businesses can claim that sustainability is incorporated in their business model. The European Union has been issuing directives that govern this area of business for a while now, especially since the introduction of The Green Deal, making them mandatory for certain market participants.