ESG, which refers to how environmental, social and governance factors pertain to business, has been all over the headlines lately — and the debate has become increasingly contentious. Billionaires like Elon Musk call it a “scam,” consumers and business leaders see it as a strategic priority to develop more sustainable business models, while governments are implementing ESG standards as a way to act in the public’s interest.
Each of these diverse sets of stakeholders have a valid claim to ESG, but they also have radically different priorities when it comes to how it’s used. It’s no wonder, then, that debates around the topic between these groups often devolve into arguments, name-calling, and more shouting than listening.
In order to move the debate from combative to constructive, we need a shared language. Stakeholders need to be able to express what they want out of the movement, and be able to understand what others want out of it (even if they are approaching it from a different angle).
When debating ESG, stakeholders typically fall into one or more of the following categories in terms of what they want out of the movement: assurance, impact or regulation.
In this article, we’ll take a closer look at each, and suggest how they can be used together to facilitate the implementation of meaningful practices that positively impact society and the environment.
ESG for assurance
ESG for assurance is all about adjusting for financial risk. From this…
