Sustainable Finance and ESG Reporting
Sustainable Finance and ESG Reporting
Introduction Sustainable finance refers to making investment decisions that consider the social and environmental impacts, rather than financial returns solely. According to the World Bank, it is the process of taking due account of environmental, social, and governance (ESG) considerations when making investment decisions in the financial sector, leading to increased longer-term investments into sustainable economic activities and projects. In brief, these elements can be put in proper context: 1. Environmental: this has to do with an organization's impact on the planet – e.g., greenhouse gas emission, pollution, water consumption, etc. 2. Social: this has to do with the impact on people, including staff, customers, and the community – e.g., human rights, inequality, health & safety, etc. 3. Governance: how an organization is governed – transparency, board independence, shareholders’ rights, etc.