An Introduction to ESG

The term Environmental, Social, and Governance, abbreviated to ESG, relates to the investing sphere. In all sectors, companies look for investors. ESG is an important concept for all kinds of people, including employees, CEOs, investors, and government officials.

By the end of this track, you’ll know what ESG is, how it looks in practice and its advantages and disadvantages. You will also be able to identify the dilemmas businesses that want to pursue ESG principles come up against.

ESG is a framework that third-party companies and research groups use to identify whether a company is a viable investment opportunity. Dr Jean Rogers, founder of the Sustainability Accounting Standards Board, created the framework so that ‘investors could compare performance on critical social and environmental issues, and capital could be directed to the most sustainable outcomes.’

ESG is an alternative to the widely held belief that companies can only be sustainable when they focus on the environment. In the investing sphere, ESG is a set of criteria (or standards) that socially and economically conscious investors use to decide whether they want to invest.

Learning Objectives

• Identify what Environmental, Social, and Governance means
• Discover examples for each of the three facets of ESG investing
• Establish some of the advantages and disadvantages of ESG investing