What is Environmental, Social, Governance?

The term Environmental, Social, Governance (ESG) has been popping up more and more in many industries under the “Safety” umbrella.  But what is Environmental, Social, Governance, and what does it mean?  I’ll explain my understanding of it.  What is ESG?

ESG is a term used for measuring a company’s social and environmental sustainability.  This is a way for companies to better focus on sustainability in a world fixating on preserving the earth and enhancing employee wellbeing.


Many companies already focus a lot of attention on their environmental impact.  Reducing emissions, preserving natural resources, and reducing waste are the ultimate goals.  Metrics can be gathered to measure the amount of water used, waste generated, and emissions expended.  These metrics can then be used to create an action plan to reduce water usage, waste, and emissions.  All companies, no matter how small, use water and create waste that can both be limited.


More than ever before, companies are focusing on enhancing employee well-being and mental health.  Under the social aspect of ESG, companies are creating policies and procedures to prevent mental health issues caused by stress and anxiety in the workplace.  In addition, they look at the overall picture of a better work-life balance.


Governance is more of an overarching aspect of ESG.  Companies are making conscientious financial decisions with sustainability in mind.  Again, using metrics as a guide for goal setting and continuous improvement overall as a company.

This all fits together to follow the Global Reporting Initiative for reporting ESG information.  As more and more companies fall into alignment with ESG, either willingly or required by their clients, policies, and programs will need to be adopted to ensure compliance.

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Amber Hebert

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