Understanding ESG (Environmental, Social, and Governance)

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The goal of ESG is to integrate environmental, social, and governance issues in asset and capital management.

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ESG contributes significantly to the diffusion of governance mechanisms.

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Conscious consumption movements are gaining strength to reduce emerging negative environmental impacts.

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These movements aim to address and mitigate new environmental challenges.

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The concept of ESG became globally discussed after the 2004 "Who Cares Wins" report.

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This report was a joint initiative by the UN and financial institutions to develop guidelines for integrating ESG issues.

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Environmental issues impacting investments include climate change and related risks.

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Environmental issues impacting investments include climate change and related risks.

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Social issues include health and safety in the workplace.

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Social issues include health and safety in the workplace.

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Governance issues include board structure and responsibility.

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Governance issues include board structure and responsibility.

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Customer satisfaction and loyalty

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Marketing

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Access to capital, lower cost of capital

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Financial

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"Who Cares Wins" report availability.

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Available at: https://d306pr3pise04h.cloudfront.net/docs/issues_doc%2FFinancial_markets%2Fwho_cares_who_wins.pdf