It is a set of criteria that evaluates the social, environmental, and governance impact of companies. An acronym in English, which stands for "environmental", "social", and "governance".

ESG - this acronym is here to stay! Stay tuned!

Here, we gather three best definitions for a better understanding of this acronym that is currently very much in vogue:

• It refers to the environmental, social, and governance practices of an organization, which will be evaluated for sustainability and social impact.

• It is responsible towards the environment, employees, clients, suppliers, and the community, through practical actions that benefit the organization.

• It is a set of standards and best practices that defines whether the organization is socially conscious, sustainable, and properly managed. It is a way of measuring the sustainability performance of an organization.

COMPONENTS OF ESG.

Environmental: Analyzes the impact that a company has on the environment and its commitment to sustainability. Factors: carbon emissions, energy efficiency, waste management, conscientious water use, actions to improve and preserve biodiversity, the company's stance on climate change issues, among others.

Social: Analyzes how the company manages its relationships with employees, clients, suppliers, and the community. Involves issues such as labor rights, diversity and inclusion, human rights, employee health and safety, child labor, slavery, involvement in deforested or burned areas, community engagement, product safety, among others.

Governance: Analyzes the decision-making processes, responsibility, and transparency of a company. Includes aspects such as board composition, executive compensation, shareholder rights, auditing practices, financial and accounting transparency, complete and honest financial reporting, among others.

ESG INVESTMENTS.

When an organization invests in ESG practices and standards, it generates opportunities and recognition of social, environmental, and governance responsibility, thus promoting its growth as an organization actively concerned with improving the world, as well as obtaining special credit lines.

ESG factors suggest a good rating for investors or financial institutions, when evaluating the sustainability and risk profile of a company or investment. This creates a chain of opportunities and advantages. Cool, right?

Are you interested and want to know more?

The ESG theme is quite broad, so very soon we will continue, delving deeper and learning more about this acronym that is currently gaining a lot of attention in the corporate world and financial institutions.

I9 with us and see you in the next content!