presentations on esg

Newly Launched - AI Presentation Maker

Researched by Consultants from Top-Tier Management Companies

AI PPT Maker

Powerpoint Templates

Icon Bundle

Kpi Dashboard

Professional

Business Plans

Swot Analysis

Gantt Chart

Business Proposal

Marketing Plan

Project Management

Business Case

Business Model

Cyber Security

Business PPT

Digital Marketing

Digital Transformation

Human Resources

Product Management

Artificial Intelligence

Company Profile

Acknowledgement PPT

PPT Presentation

Reports Brochures

One Page Pitch

Interview PPT

All Categories

Top 10 ESG Framework Templates to Build an Eco-friendly Enterprise [Free PDF Attached]

Lakshya Khurana

Swedish power company Vattenfall, a government-owned utility, is facing an unprecedented environmental crisis that threatens its existence. It wanted to sell electricity from three of its hydroelectric power stations on the bed of the Dalälven river. It is a World Heritage Site.

The Swedish government and the United Nations Education, Scientific and Cultural Organisation (UNESCO) were now committed to protecting the site, and power generation there would make these organizations lose face.

The Swedish government was also under pressure from local politicians and environmental campaigners to reduce its stake in Vattenfall. They claimed that the company, among Europe’s largest generators of electricity from renewable energy, was producing more hydroelectric power than the country’s grids could use.

With the government on the verge of issuing an order on reducing its stake, Vattenfall is in the process of implementing its new business model of ESG that will allay all environmental concerns, while allowing it to continue to be in business.

ESG, in fact, is a major go-to way for most businesses today. Why did Vattenfall choose ESG? Let’s understand…

What is ESG and why is important?

The acronym ESG stands for Environmental Social and Corporate Governance. It is the shared responsibility of the three parties involved in the business — government, stockholders/investors, and companies. Not working within ESG policies has damaged the reputation of a number of multinational companies.

ESG practices have been shown to improve both financial performance and business resilience in the long term. The risks that arise from its non-compliance are significant, but so are the benefits in terms of improved reputation and enhanced resilience.

Additionally, the ESG framework is becoming increasingly popular among financial professionals as they seek to provide investors with differentiated products that also consider social values in addition to traditional monetary values.

If you, too, want to benefit from the ESG framework, create a robust plan of action. To help you strategize effectively, we present our visually captivating templates.

Customizable Templates to Bring Your ESG Plan to Fruition

Creating a PowerPoint presentation from scratch is tasking and it might not turn out to be as eye-catching as you would like. This is where our professional PowerPoint services come in handy.

We have selected the most effective ESG framework PPT designs that will help you get started on educating your audience on the benefits of integrating an ESG plan. Let’s take a look at them.

Template 1: ESG Strategies Map Human Rights Product Responsibility

This PowerPoint layout uses an interactive map interface (strategy, KPIs, key constituents, etc) to identify key areas of risk and opportunity, as well as track your progress over time. With this PPT design, you can assess and manage your company's social and environmental responsibilities. So download it now.

Download this template 

Template 2: Community Impact Annual Report PPT Slides

This PPT deck is perfect for organizations who wish to track their community impact and share the findings with funders and other stakeholders. You can use this design to cover snapshots of major CSR achievements, an overview of CSR initiative outcomes, the corporate profile of the company, etc. Download it now.

Grab this template

Template 3: Environmental Stewardship Social Responsibility And Governance Policies For Oil And Gas Industry PPT

This creative PowerPoint set will help you outline your policies and procedures for being a good steward of the environment and acting with social responsibility. Additionally, the design is completely editable and you can tailor it to your specific needs. This one-page document is perfect for sharing the policies of the oil and gas industry. So incorporate it now.

Download this template

Template 4: Environmental Social And Governance Policies For Oil And Gas Industry Document

This PPT theme is perfect for helping oil and gas companies adhere to the highest environmental and social standards. This design is concise, easy to use, and covers all the key points. This PowerPoint preset contains everything you need to get started, from an overview of ESG policies to a checklist of considerations. Therefore, employ it now.

Template 5: ESG Framework With Rating And Score

This creative PowerPoint bundle provides an accurate and timely rating/score of your company's performance in relation to environmental and social responsibility. You can use this design to identify areas of strength and weakness. The PPT layout covers the ESG score, pillar score, and theme score. So get it now.

Template 6: ESG Strategy For Business Organisation

This PPT preset will help you develop a strategy that is tailored to your specific business needs, so you can make a real difference in your community and the world. You can use it to illustrate the elements for each of the ESG verticals, such as strict standards, people, transparency, regulation, etc. Download it now.

Template 7: Organisational ESG Quarterly Initiatives Summary

This PPT preset provides an up-to-date summary of the latest progress in the key areas, so you can stay informed about the latest developments in sustainability. You can use it to stay ahead of the curve including, an ESG summary, the negative impact risks, and an indicators summary. Download it now.

Template 8: ESG Model With Focus Areas

This PPT layout will help you identify and focus on key areas of the ESG metrics and implement best practices to create a socially aware work environment. Some of the focus areas covered in this presentation are waste management, renewable resources, workforce health, safety, etc. This PowerPoint layout also helps businesses identify and address critical sustainability issues. So get it now.

Template 9: ESG Framework KPIs Mapping

Pick this template to illustrate how ESG is a critical part of responsible investing. In this PPT layout, the KPI mapping will help you track your progress and identify areas of improvement. Besides, this design includes metrics, such as resource use, emissions, human rights, management, etc. Get it now.

Template 10: Impact Assessment Chart For ESG Efforts

You can use this PPT design to keep track of your company's environmental and social governance efforts. With this PowerPoint preset, you can see at-a-glance how well your business is performing in terms of sustainability, operations, end product, human capital, etc. Download it now.

Modern businesses exist only to earn revenue but in this current global economy, that attitude is not enough. Especially if the consumer opinion is anything different, blind profits aren’t received well by the customer base that is more aware of worldwide issues. It is the duty of the companies and shareholders to make good on their investments.

However, many organizations have come under criticism recently because they are struggling to create profit for their shareholders along with minimizing the negative impact on the environment.

But you can use our stunning ESG framework templates to determine whether or not your operations are adequately protecting environmental and social interests. Download these stunning presentations right away and advocate an eco-friendly turn to your business.

P.S: To add sustainability and climate change to the social pivot plan of your company check out these amazing templates featured in this guide .

Download the free ESG Framework Templates .

Related posts:

• [Updated 2023] Top 25 Green Renewable Energy PowerPoint Templates for a Sustainable Coexistence
• Top 20 Sustainability, Social Responsibility and Climate Change Presentation Templates for Business and Environment Presentations!!
• 10 Elements of A Successful Corporate Sponsorship Proposal (With Presentation Templates)
• How To Create A Corporate Pitch Deck With Sample Templates and Examples

Liked this blog? Please recommend us

Top 10 Poka-Yoke PPT Templates for Fool-Proof Business Operations

[Updated 2023] The 5 Leadership Styles Along (With PPT Templates Included)

Top 15 Business Card Templates to Represent Your Brand

Top 10 PPT Templates to Propagate the Benefits of Retirement Planning

This form is protected by reCAPTCHA - the Google Privacy Policy and Terms of Service apply.

--> Digital revolution powerpoint presentation slides

--> Sales funnel results presentation layouts

--> 3d men joinning circular jigsaw puzzles ppt graphics icons

--> Business Strategic Planning Template For Organizations Powerpoint Presentation Slides

--> Future plan powerpoint template slide

--> Project Management Team Powerpoint Presentation Slides

--> Brand marketing powerpoint presentation slides

--> Launching a new service powerpoint presentation with slides go to market

--> Agenda powerpoint slide show

--> Four key metrics donut chart with percentage

--> Engineering and technology ppt inspiration example introduction continuous process improvement

--> Meet our team representing in circular format

Environmental Social Governance PowerPoint Template

The Environmental Social Governance PowerPoint Template features slide designs for presenting ESG analysis, risks, and opportunities. ESG is the acronym for Environmental, Social, and Governance. Using these three aspects, investors and analysts deduce the functioning quality of the company. The environmental aspect deals with how the procedures or production at the company is impacting the immediate environment, e.g., waste management and emissions. The S in ESG corresponds to the social interaction of the company with the customers & employees. It also involves other parameters like data privacy and policies. The governance in ESG points to the management team and leadership. This aspect primarily attracts investors, as they will put more trust in organizations with a consolidated team of directors and leaders.

Our ESG Slide Template features nine editable slides in two background color variations (white and dark). The color palette chosen for this presentation template has green shades representing the ESG concept. The template begins with a cover slide showing the green earth illustration with a human hand and leaves around it. Professionals can opt for how to start a presentation by introducing the presentation title and company name on this slide. Following this slide is a semi-circle three-segment diagram with icons to note descriptions. Similarly, this semi-circle diagram is enriched with more relevant icons on the next slide. These icons can help in the visual communication of the concept before the audience.

This Environmental Social Governance PowerPoint Template also includes individual slides for E, S, and G with editable text boxes having a green color scheme. These slides carry icons and an engaging design. Presenters can also use the three-column and table slides to discuss the ESG analysis. The last slide is a summary presentation slide with donut charts, bar graphs, and color-coded bars. So, this ESG Presentation template can help consultants and analysts showcase the ESG status of the company in both descriptive and numerical data forms. Using the text boxes, they can demonstrate environmental impacts or governance setup risks.

Similarly, they can discuss the opportunities for investing. The company executives can also use this PPT Template to discuss the ESG status and development of management strategies accordingly. Hence, download this best PPT template and customize it with all PowerPoint versions and Google Slides. Alternatively, you can download other sustainability PowerPoint templates and presentation slides.

You must be logged in to download this file.

Favorite Add to Collection

Subscribe today and get immediate access to download our PowerPoint templates.

Related PowerPoint Templates

Organizational Climate Diagram PowerPoint Template

Stairs Infographic PowerPoint Template

6-Component Governance Operating Model

5S Plan Diagram Template for PowerPoint

• Contributors

Introduction to ESG

Mark S. Bergman ,  Ariel J. Deckelbaum , and Brad S. Karp are partners at Paul, Weiss, Rifkind, Wharton & Garrison LLP. This post is based on a recent Paul Weiss memorandum by Mr. Bergman, Mr. Deckelbaum, Mr. Karp,  David Curran ,  Jeh Charles Johnson , and Loretta E. Lynch . Related research from the Program on Corporate Governance includes The Illusory Promise of Stakeholder Governance by Lucian A. Bebchuk and Roberto Tallarita (discussed on the Forum here ) and Socially Responsible Firms by Alan Ferrell, Hao Liang, and Luc Renneboog (discussed on the Forum here ).

Interest on the part of investors and other corporate stakeholders in environmental, social and governance (“ESG”) matters has surged in recent years, and the current economic, public health and social justice crises have only intensified this focus. ESG, at its core, is a means by which companies can be evaluated with respect to a broad range of socially desirable ends. ESG describes a set of factors used to measure the non-financial impacts of particular investments and companies. At the same time, ESG also provides a range of business and investment opportunities.

Net flows into ESG funds available to U.S. investors have skyrocketed, totalling $20.6 billion in 2019, nearly four times the previous annual record set in 2018, [1] while ESG funds in Europe also attracted record inflows of $132 billion in 2019. [2] More than 70% of funds focused on ESG investments outperformed their counterparts in the first four months of 2020, [3] and nearly 60% of ESG funds outperformed the wider market over the past decade. [4] Consumers and investors are placing a growing value on ESG, and industry leaders have responded in a number of ways, including issuing comprehensive sustainability reports and expanding ESG disclosures in their annual reports, providing information to ESG rating agencies and publicly communicating ESG commitments.

This post, the first in a series focused on ESG disclosure and regulatory developments, provides an introduction to ESG and identifies several critical issues for companies and their in-house counsel to keep in mind in evaluating and monitoring ESG actions and statements.

The Fundamentals of ESG

ESG grew out of investment philosophies clustered around sustainability and, thereafter, socially responsible investing. Early efforts focused on “screening out” (that is, excluding) companies from portfolios largely due to environmental, social or governance concerns, while more recently ESG has favorably distinguished companies that are making positive contributions to the elements of ESG, premised on treating environmental and social issues as core elements of strategic positioning. While climate figures prominently in ESG discussions, there is no single list of ESG goals or examples, and ESG concepts often overlap. That being said, the three categories of ESG are increasingly integrated into investment analysis, processes and decision-making.

• The “E” captures energy efficiencies, carbon footprints, greenhouse gas emissions, deforestation, biodiversity, climate change and pollution mitigation, waste management and water usage.
• The “S” covers labor standards, wages and benefits, workplace and board diversity, racial justice, pay equity, human rights, talent management, community relations, privacy and data protection, health and safety, supply-chain management and other human capital and social justice issues.
• The “G” covers the governing of the “E” and the “S” categories—corporate board composition and structure, strategic sustainability oversight and compliance, executive compensation, political contributions and lobbying, and bribery and corruption.

ESG metrics have evolved in recent years to measure risk as well as opportunity. In his “Dear CEO” letter in 2018, BlackRock Chairman and CEO Larry Fink wrote that:

[s]ociety is demanding that companies, both public and private, serve a social purpose. To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society. Companies must benefit all of their stakeholders, including shareholders, employees, customers, and the communities in which they operate.

He goes on to say that:

Companies must ask themselves: What role do we play in the community? How are we managing our impact on the environment? Are we working to create a diverse workforce? Are we adapting to technological change? Are we providing the retraining and opportunities that our employees and our business will need to adjust to an increasingly automated world? Are we using behavioral finance and other tools to prepare workers for retirement, so that they invest in a way that will help them achieve their goals? [5]

Other leading business leaders have also supported more expansive views regarding the purpose of a corporation. In August 2019, the Business Roundtable, a non-profit organization comprised of corporate CEOs, released a new Statement on the Purpose of a Corporation (the “BRT Statement”). [6] The BRT Statement was signed by the CEOs of nearly 200 leading U.S. companies and identified shareholders as one of five key stakeholders—along with customers, workers, suppliers and communities. The BRT Statement supersedes prior statements that endorsed shareholder primacy (the idea that corporations exist principally to serve shareholders), and “outlines a modern standard for corporate responsibility.” [7]

ESG in Practice

Under the current disclosure regime applicable to public companies listed in the United States, there is no affirmative duty to provide disclosures on ESG matters. As a practical matter, however, it can be anticipated that important stakeholders, such as investors, insurance companies, lenders, regulators and others, will increasingly look to companies’ disclosures to allow them to evaluate whether those companies have embraced ESG agendas. And, even in the absence of an affirmative duty to disclose, the substance of the information that companies do elect to report regarding their actions to identify and manage ESG risks and opportunities will be subject to the securities laws.

As we will discuss in future posts in this series, the ESG regulatory landscape regarding disclosure is rapidly evolving. While there is a general recognition of the value of, and the imperative for, consistent and decision-critical information to more easily evaluate how companies are overseeing and managing ESG-related risks and opportunities, most companies have yet to achieve that level of consistency. Moreover, ESG factors cover a broad range of activities that may or may not be relevant to particular businesses and their performance, or their potential positive effect on communities, or more broadly, societies. These metrics need to be refined. Accordingly, a prudent public company will find it desirable to establish its own criteria for determining the scope and content of its ESG disclosures, both to mitigate legal risk and identify future opportunities that ESG presents in terms of growth and differentiation.

In the absence of international consensus regarding ESG disclosures, a number of frameworks and indices have emerged to guide company disclosures and inform investors. Some of the leading international frameworks include the Global Reporting Initiative standards, the Sustainability Accounting Standards Board (SASB) standards, the United Nations Principles for Responsible Investment and the United Nations Sustainable Development Goals. Ratings have also proliferated over the last decade. Morgan Stanley Capital International (MSCI) and specialist firms such as Sustainalytics have recently been joined by traditional credit rating agencies such as Moody’s and S&P Global. A recent estimate suggests that the “global market for ESG ratings is currently worth about $200m and could grow to $500m within five years.” [8] The influence of these frameworks and rating agencies is such that they may shape regulation to come.

ESG is also influenced by public opinion. ESG issues are inherently reputational, especially given recent societal events. As more companies provide ESG disclosures and commitments, and given the speed of social media responses and the news cycle, observations about a company’s ESG actions or inactions are often published and sometimes go viral. Companies that are out of step with public opinion and market demands may face punishing reputational consequences.

Matching Aspiration and Action

We will describe in subsequent alerts the challenges faced by companies in developing a disclosure posture that satisfies the needs of a growing number of stakeholders, as well as the challenges faced by many of those stakeholders in obtaining information that is consistent and decision-critical. While ESG disclosures today are, from an SEC perspective, purely voluntary, over time that could change, and in the meantime there may be increasing pressure from a range of stakeholders to incorporate ESG statements. If a company’s ESG disclosures (for example, those in relation to compliance with legal, regulatory or voluntary standards or a particular commitment to achieve an ESG-positive outcome) later appear to be false or misleading, the company could face reputational backlash, shareholder lawsuits or possibly regulatory enforcement. Putting aside which disclosure standards they adopt, companies should ensure that they take a systematic approach to ESG reporting.

We highlight below considerations that should facilitate tying aspirations to actions and mitigating legal and reputational risks for commitments that cannot realistically be achieved:

• Monitor internal ESG disclosures and commitments . Management should appoint a team tasked with monitoring the company’s ESG disclosures and commitments, recognizing that these statements can appear in a variety of formal communications ( g. , SEC filings, or in documents incorporated by reference in SEC filings, sustainability reports and corporate responsibility reports) as well as informal communications ( e.g. , communications to employees, social media posts, media interviews and website postings). The team should identify existing ESG commitments to establish a baseline. Thereafter, the team should have a procedure in place to monitor ESG disclosures of the company as well as of peer firms.
• ESG statements made publicly should be vetted for factual accuracy and context in the same way as any other statement of fact.
• Forward-looking commitments should be qualified as such, much as other forward-looking statements are (with aspirational qualifiers and appropriate disclaimers).
• Management should consider extending the internal disclosure controls and procedures process to ESG statements, since some statements may well find their way into SEC filings.
• Even though ESG disclosure standards are not mandatory, the SEC has noted that it will be comparing information that is voluntarily provided with disclosures made in SEC reports and registration statements, which is consistent with its general approach of monitoring analyst and investor calls as well as other statements made outside of SEC filings (for example, to police the use of non-GAAP financial measures and selective disclosure rules).
• As with all material statements that are included in public disclosure, coordination among the relevant internal constituencies is critical and collaboration should be encouraged.
• Educate employees on the risks associated with ESG disclosures . Employees responsible for preparing and updating ESG disclosures should be sensitized to the risks associated with public disclosures and to the importance of ensuring that ESG statements are consistent with the company’s description of its business, its MD&A and its risk factors in annual and quarterly reports, even if those latter disclosures have no apparent ESG themes.
• Measure ESG performance . The ESG team should establish procedures to determine whether the company’s actions match its public ESG goals, the standards set by industry leaders and the frameworks established by third parties that the company has committed to—or is required to—follow. Doing so can help a company identify any vulnerabilities in order to mitigate potential legal and reputational risks.

1 See Greg Iacurci, “Money moving into environmental funds shatters previous record,” CNBC (January 14, 2020) , available here . (go back)

2 Lucca De Paoli, “European ESG Funds Pulled in Record $132 Billion in 2019,” Bloomberg (January 31, 2020), available here . (go back)

3 See Madison Darbyshire, “ESG funds continue to outperform wider market,” Financial Times (April 3, 2020), available here . (go back)

4 See Siobhan Riding, “Majority of ESG funds outperform wider market over 10 years,” Financial Times (June 13, 2020), available here . (go back)

5 Larry Fink, Blackrock, “‘Dear CEO Letter” (2018), available here . (go back)

6 Business Roundtable, “Business Roundtable Redefines the Purpose of a Corporation to Promote ‘An Economy That Serves All Americans’” (August 19, 2019), available here . (go back)

7 Id . (go back)

8 Billy Nauman, “Credit rating agencies join battle for ESG supremacy,” Financial Times   (September 17, 2019), available here . (go back)

One Comment

Common ESG metrics by Deloitte, EY, KPMG, PwC: Please show business case.

The Big Four accounting firms EY, PwC, KPMG, and Deloitte have unveiled on 22 September 2020 a paper proposing to harmonize ESG reporting standards. However, they have not presented any business case. Real data with real companies is what is needed.

Author: Sharafat A. Paracha, 25 September 2020.

Many years ago, before ESG was even coined, I was a young graduate with a Masters’ in Sustainability and I proposed Bordier & Cie, one of the oldest private banks in Geneva (and the only one to have maintained its unlimited liability status), to develop a Corporate Social Responsibility Index for one of its clients. That was 1999 and again in 2000. Claude Morgenegg, the person who hired me, had a Ph.D. in mathematics and in charge of the analysis team. He looked at the general framework I submitted to and then said: you have a model. Great! Now prove it works by collecting the data. That is when reality kicked me in the face and showed me that it was easier said than done.

So, I had to design a system for collecting the data I needed that was not publicly available. Remember, this was before sustainability reports were a common staple. Only a few Scandinavian companies were informing the public on CSR issues. I had to design a questionnaire to give to companies and follow-up with them to obtain answers. Answers from companies were not enough. No, no, no. I had to validate their answers by conducting investigations into their activities around the world, comparing their reports from what NGOs and other sources said. Then I had to convert it all into understandable, measurable and comparable metrics before arriving at a final selection. Then, there was the process of analyzing all the information I had, filtering it and assessing it before it could be ready to be transcribed into a system of notation. This CSR index needed also to be reproducible in the future. Only then one could use it for decision making in portfolio selection. I still have the work I did for them in a diskette. Remember those? I cannot read it as the technology is now obsolete. It was hard work which I did alone but with good guidance and serious oversight. It was necessary as what was at stake was tens of millions of Swiss francs and Bordier & Cie reputation to deliver to the client and to the rest of the private banks. Bordier & Cie became among the first private banks in Switzerland to offer CSR analysis to its clients.

The situation in ESG now in 2020 is completely different from 20 years ago. Sustainability reports have become a staple for corporations. There are a plethora of sustainability standards. There are now teams of ESG analysts who work in banks and for specialized funds producing streams of reports regularly. There is an overload of sustainability perspectives, systems and data. Complexity in ESG has become the norm.

The big four accounting firms EY, PwC, KPMG, and Deloitte are not facing the challenges I faced. They are not alone and are not operating with limited resources. They have access to every ESG source and data. They have substantial resources. They have knowledge, experience and clout. Together with the World Economic Forum they have unveiled on 22 September 2020 a paper proposing to harmonize ESG reporting standards. However, they fail to provide any data, any case study, any business model to back their proposal. Putting a table of metrics together is the easy part. The harder part is getting companies to agree, getting the data, independently validating the data (be in no doubt that if you don’t do this you expose yourself to serious risks – after all, there are also short sellers), getting banks to find them useful, getting clients to put their money.

This is a welcome first step, don’t get me wrong. ESG needs this to take-off and anything that starts the ball rolling is to be encouraged. But I believe a solid business case is necessary. When I developed the Bordier & Cie CSR system, I looked into more than 20 companies. It is reasonable to ask the Big Four accounting firms and the World Economic Forum to commit to providing 20 ESG evaluations of diverse types of corporations based on their harmonized metrics for IBC’s Winter Meeting in January 2021.

Supported By:

Subscribe or Follow

Program on corporate governance advisory board.

• William Ackman
• Peter Atkins
• Kerry E. Berchem
• Richard Brand
• Daniel Burch
• Arthur B. Crozier
• Renata J. Ferrari
• John Finley
• Carolyn Frantz
• Andrew Freedman
• Byron Georgiou
• Joseph Hall
• Jason M. Halper
• David Millstone
• Theodore Mirvis
• Maria Moats
• Erika Moore
• Morton Pierce
• Philip Richter
• Elina Tetelbaum
• Marc Trevino
• Steven J. Williams
• Daniel Wolf

HLS Faculty & Senior Fellows

• Lucian Bebchuk
• Robert Clark
• John Coates
• Stephen M. Davis
• Allen Ferrell
• Jesse Fried
• Oliver Hart
• Howell Jackson
• Kobi Kastiel
• Reinier Kraakman
• Mark Ramseyer
• Robert Sitkoff
• Holger Spamann
• Leo E. Strine, Jr.
• Guhan Subramanian
• Roberto Tallarita

July special: Financial Reporting PPT Templates. Save with bundles 30%

How to Present Social Sustainability of ESG Report With Visual PowerPoint Slides

• January 26, 2023
• PowerPoint templates for download , Sustainability, ESG, Climate Change presentations

Last Updated on June 28, 2024 by Barbara

While presenting ESG issues in your sustainability report, they may be a moment when you’ll need to go in-depth with the social sustainability aspects of the study. Listing your company’s goals, actions, and achievements in this field could end with a bunch of similar descriptions.

Using visuals to support your messages proves to be an effective way to stand out. They help in creating logic across your slides, color-coding crucial information, and winning your audience’s attention. Not to mention emphasizing the professionalism of the presenter.

Feel encouraged to convince yourself of these statements by checking our example slides in the following paragraphs. For your inspiration, we present a detailed design analysis of some of our topic-related diagrams:

• a  list of  target social beneficiaries
• a  social sustainability examples
• a  list of diversity & inclusion achievements
• a presenting employee satisfaction
• explaining GDPR policy areas

Get all the graphics presented here – click on the slide pictures to see and download the source illustration. Check the complete Social Sustainability Report ESG Presentation here .

Why Use Visual Way of Presenting Social Sustainability in ESG Report?

Presentation composed of similar-looking content slides often causes a loss of interest in your audience. In the case of text descriptions and lists, alteration possibilities are constrained.  

It is generally accepted to limit font types, colors, and sizes; therefore, graphic elements come in handy when there is a need for differing slides from each other. Conscious use of colors, text containers, or icons allows the creation of a coherent deck of slides with similar content but varied appearance. This way, we can juice up the presentation to everyone’s benefit. 

If you struggle with diversifying your data-rich slides or searching for visual ideas for your social sustainability report, this blog post may be a great source of inspiration.

Present a List of Target Beneficiaries of the Social Responsibility Strategy

Defining the beneficiaries of social sustainability policy may help open a chapter of the ESG report. This topic is closely linked with defining goals, conducting a SWOT analysis, or understanding supply chain connections. Describing actors in the social responsibility scene (employees, community, suppliers, and customers) lays the foundation for further discussing their relations.

In order to make the list of elements more appealing to the audience, we propose to present its items horizontally on our example slide. It creates an effect of personas cards which fits the topic very well. On top of that, we used meaningful outline icons illustrating each card to make the information memorable. Bold titles and detailed descriptions introduce participants before moving on to the detailed lists of their benefits. Such reading logic is achieved through the horizontal listing and popping out dark text backgrounds, which attract attention.

Highlight Social Sustainability Achievements Contributing to Global ESG Targets

Lists of short text descriptions related to numbers find use in chapter summaries and are meant to fall into the reader’s memory. In social sustainability reporting, they can be used to highlight metrics such as percentage shares, rating results, financial investments, or ISO standards.

Such slides are an excellent opportunity for creating solid visual messages of great resonance. The following diagram illustrates how adding colors, icons, and big numbers transforms a simple list into an appealing infographic. In this example, all elements were combined into long horizontal tickets designed in the presentation color palette and arranged diagonally using the entire slide area. We know from our professional experience that information conveyed in this way is easy to read, engaging, and impactful. 

Illustrate the Company’s Diversity & Inclusion Initiatives With Quadruple Diagram

Inclusivity initiatives have become a flag achievement for many businesses nowadays. It is one of the most critical aspects of social sustainability, and this is why we are sharing our example slide covering this topic. Take a closer look and notice how design decisions enriched content that would be more of a simple list.

The first decision that catches the eye is distributing list elements in the matrix layout. This approach allows for utilizing the entire slide space. The second visible design decision is assigning colorful title tiles to each description and illustrating it with extensive outline icons suitable for topics such as:

• LGBTQ+       

The last visual decision noticeable on this slide is linking text container graphical titles and additions with illustrative tiles mentioned before. This action results in a clear and coherent slide conveying the message effortlessly.   

Employees Satisfaction Measurement Dashboard Example

When thinking about how social sustainability is obtained conducting the research plays a fundamental role. One of the aspects of social balance in the working environment is employee satisfaction which can be rated in terms of employee net promoter score and employee satisfaction index. Displaying statistics data becomes interesting when visuals are incorporated. Let’s analyze the slide below and check how it works.

In this example slide space has been divided into three sections – two for presenting eNPS and ESI measures and one for a written summary. They can be easily distinguished thanks to the dedicated use of green and navy graphics. What’s special about the result section is the application of gauge charts and icons supporting the message. Also, the conscious use of red, yellow, and green among evaluation graphics refers to universally used color coding expressing success or failure. Replacing text data with visuals resulted in an orderly and legible dashboard of human resources metrics.

Compose GDPR Policy Slide With Descriptions of Data Privacy Areas

Data management is considered part of social sustainability policy. Whenever people are involved, some information starts circulating, especially in the business environment. Employees and customers became genuinely concerned about their privacy and the security of sensitive data collected about them. Presenting a company’s attitude to GDPR Policy is nowadays often included in ESG reporting and covers topics such as:

• data collection,
• data protection,
• data processing,
• data storage.

When you add a text description to each topic, you will get a pretty dense text slide. Such text-rich slides may be overwhelming to the audience, so we prepared an example of a visual template helping to solve that problem. You can see how even and total usage of the slide area created an interesting structure for detailed descriptions. Narrow paragraphs are easier to read than full-width-long ones and adding large titles, colors, and icons to the composition make it easy to navigate the content quickly. As the whole slide is about the company’s goals, there has been a symbol of a mountain with arrows in all directions added in the central area.

Summary of Design Tips for Social Sustainability Report ESG Presentation

Sustainability reports usually contain an extensive amount of information. Using PowerPoint format for such ESG reports gives you the opportunity to introduce graphical structure and elements that help comprehension of more complex documents. 

Composing the presentation of text-rich slides often requires a dose of imagination to diversify them and keep the audience interested. The horizontal layout of PowerPoint documents may be challenging when filling in descriptions and lists. Some design tricks help to enrich slides and use the whole slide space; others make the composition more readable and engaging. Check the summary below and feel free to draw from it as you’ll be working on your following social sustainability report: 

• distribute elements of your lists alternately in horizontal, vertical, diagonal, or distracted order
• keep your color pallet simple and coherent throughout the whole presentation
• choose colors symbolizing harmony, responsibility, and trust to discuss social sustainability
• use large titles to help readers navigate slides easily
• support the content with meaningful icons to make slides memorable
• use text containers to implement a structure to your slides
• illustrate data metrics with color-compatible data charts

Resource: Social Sustainability Report ESG PowerPoint Presentation Template and Layouts

The social sustainability report ESG layouts presented on this blog are available for download in the format of a PowerPoint file within the infoDiagram collection of ready-to-use PPTX templates. You will find many slides appropriate for institutional, business, and civil audiences in this presentation, including social sustainability definitions, ESG achievements, employees policy, diversity & inclusion, employees satisfaction, community engagement, company CSR investments, circular consumption, GDPR policy, supply chain management, and more.   Don’t hesitate to check the details and click the link to the Social Sustainability Report ESG Presentation Template below:

If you look for more visuals to illustrate sustainability topics try our template for the circular economy and sustainability .

Chief Diagram Designer, infoDiagram co-founder

Related Posts

How to Visually Present B2B Segmentation in PowerPoint

• April 26, 2024

How to Present Real Estate Property with Impact Using PowerPoint

• April 15, 2024

How to Present Quoted Company Financial Report in PowerPoint

• April 10, 2024

Got any suggestions?

We want to hear from you! Send us a message and help improve Slidesgo

Top searches

Trending searches

31 templates

business pitch

696 templates

65 templates

158 templates

cybersecurity

6 templates

43 templates

Sustainability Strategy

It seems that you like this template, sustainability strategy presentation, free google slides theme, powerpoint template, and canva presentation template.

Sustainability and caring for the environment are increasingly present in business strategies. This template will help you point out the value of the measures you implement. Its design in green tones reminds of nature, with leaf motifs. Its top index will help the reader not to get lost. Use the different icons and illustrations to explain your projects visually, and the tables, diagrams and maps to expose the most relevant data.

Features of this template

• 100% editable and easy to modify
• 33 different slides to impress your audience
• Contains easy-to-edit graphics such as graphs, maps, tables, timelines and mockups
• Includes 500+ icons and Flaticon’s extension for customizing your slides
• Designed to be used in Google Slides, Canva, and Microsoft PowerPoint
• 16:9 widescreen format suitable for all types of screens
• Includes information about fonts, colors, and credits of the free resources used

How can I use the template?

Am I free to use the templates?

How to attribute?

Attribution required If you are a free user, you must attribute Slidesgo by keeping the slide where the credits appear. How to attribute?

Register for free and start downloading now

Related posts on our blog.

How to Add, Duplicate, Move, Delete or Hide Slides in Google Slides

How to Change Layouts in PowerPoint

How to Change the Slide Size in Google Slides

Related presentations.

Premium template

Unlock this template and gain unlimited access

Boardroom Secrets and Invitations Magazine!

7 Tips for Creating an Effective ESG Board of Directors presentation

An Effective ESG Board of Director’s presentation:

An Environmental, Social, and Governance (ESG) Board of Director's presentation is a critical communication tool for sustainability and good governance organizations. It can educate directors about the organization's ESG performance, assess progress relative to goals, and make decisions about future priorities.

What is ESG?

ESG is the acronym for environmental, social, and governance. It's a term that refers to the overall performance and its stakeholders. ESG includes things like environmental impact, social responsibility, and economic sustainability.

Boardroom Secrets and Invitations Magazine! is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

ESG can measure the effectiveness of your company's environmental, social, and governance (ESG) performance. ESG can inform decision-making for your company and its stakeholders.

How can you measure your business's ESG performance?

There are several ways you can measure your business's ESG performance. You can use financial performance metrics to monitor your progress, such as net income or cash flows. You can also use other metrics, such as social media likes and shares, environmental impact factors (EI), and public disclosure factors (PDFs). You can also use ESG indicators to measure the success of your business initiatives.

What types of data should you collect to assess your business's ESG performance?

To assess your business's ESG performance, you should collect data about customers, employees, the environment, and other stakeholders . This data can help you make informed decisions about improving your ESG performance.

How can you present your business's ESG performance?

There are a few different ways to present your business's ESG performance. One way is to have an ESG report prepared by an independent consultant. An independent consultant's report can provide a more comprehensive and accurate picture of your business's ESG performance than a report created by you or your team.

Additionally, an ESG board presentation can provide a more specific and concise snapshot of your business's ESG performance than could be found in a report from a consultant.

A slide show is another way to present your business's ESG performance. Slideshows can help you depict the various aspects of your business's ESG performance in an easy-to-read format. Slideshows can also visually represent how well your business meets its environmental, social, and governance obligations.

What are the benefits of having an effective ESG board?

Having practical ESG board presentational tools will help you make better decisions, but it can also help you assess the progress of your company's ESG performance. 

By having an effective ESG board, you can:

Assess the progress of your business's environmental, social, and governance (ESG) performance.

Identify areas in which your company needs to improve.

Find ways to reduce environmental, social, and governance (ESG) risks.

Create a strategy for increasing the effectiveness of your company's environmental, social, and governance (ESG) initiatives.

Evaluate the effectiveness of your company's environmental, social, and governance (ESG) efforts regularly.

Recommend changes to your company's management that would improve the effectiveness of your ESG performance.

Use an effective ESG board presentation to understand your business and its stakeholders better.

Here are the best 7 tips for creating an effective ESG Board of Director's presentation:

#1 Cater to the Different skills of your board of directors

Cater your ESG presentation to the varied skill sets of your board members . Understand every board member will mix every board member's ESG skills, interest level on the topic, and understanding?

- For example, if your board is vital in finance, you can focus on the financial aspects of ESG. Include examples of how ESG Factors effects the Credit Worthiness of your organization? Ratings and Scores.

If your board is vital in marketing, you can focus on how ESG is communicated to the public.

#1 How ESG Data Points span cross-functionally can be highlighted in the presentation.

The board members should be educated on how ESG Data points and factors span Enterprise-wide functions; HR, Finance, Legal, Marketing, IT, Supply Chains, and varied Functions and the jurisdictions it operates.

#2 Every board should understand how the company will be evaluated in that industry.

How is the company operating, culture, ESG metrics, how the company is doing, and how are we doing to improve on ESG factors? Jane Bomba serves Clarivate and two different public companies in the USA. What ESG factors are we measuring, and how are we doing in those ESG factors?

My recommendation would be an analysis, a strategic road map with tangible action items planned by the CEO, CFO, and C-Suite , on how we will improve those baseline measurements?

ESG presentation with factors highlighted should be tailored to the specific company and industry. For example, a pharmaceutical company will have different ESG priorities than a food company. An environmental presentation for a power company will be other than one for a renewable energy company.

#4 ESG Systems being Implemented to Capture Baseline Measurements. 

According to Jane Bomba, The board needs to know, like any new ERP implementation , what ESG systems are we implementing in the company and how are we doing with them are relevant to the board.

#5 Creating an ESG Department and Agenda for Chief Sustainability Officer

The Chief Sustainability Officer (CSO) is a new role in most organizations that create an ESG agenda.

- The CSO should be able to report how the company is doing against its NetZero 2030, 2050 commitment goals and what progress has been made with materiality assessments

- The CSO should also be able to report on the effectiveness of different ESG factors, initiatives and policies established

The board presentation is crucial for the CSO to report on progress and get buy-in from the board for future endeavours.

#6 Some Metrics / Measurements relevant to the industry - Analysts covering the stocks in their analysis 

ESG Data points factors most pertinent to the Institutional Investors , Analysts covering the stocks in their analysis

- Example: CDP Water Disclosure Scorecard, Carbon Disclosure Project (CDP) Climate Change Report,

The organization's carbon footprint, water usage, and waste production

Community engagement metrics

Employee satisfaction and retention rates

#7 How ESG and Company Culture are being affected/measured against ESG factors

The company culture is a crucial driver of ESG. For example A company with a strong safety culture will have lower workers' compensation

- How are we doing?

- What can be done better?

- Are employees happy with the way things are going?

- What does the future look like?

Tags: sec esg comment letter, esg disclosure examples, sec esg task force, sec esg disclosure requirements

Ready for more?

One Time Code

< Go back to Login

Forgot Password

Please enter your registered email ID. You will receive an email message with instructions on how to reset your password.

ESG framework PowerPoint Templates

•   Environment-Social-Governance-01 - 4x3  –  $4.99
•   Environment-Social-Governance-01 - 16x9  –  $4.99

Environment Social Governance 01 PowerPoint Template

Environment Social Governance 01 Presentation Template Use this Environment Social Governance 01 PowerPoint template to create visually appealing....

•   Environment-Social-Governance-03 - 4x3  –  $4.99
•   Environment-Social-Governance-03 - 16x9  –  $4.99

Environment Social Governance 03 PowerPoint Template

Environment Social Governance 03 Presentation Template Use this Environment Social Governance 03 PowerPoint template to create visually appealing....

•   Environment-Social-Governance-02 - 4x3  –  $4.99
•   Environment-Social-Governance-02 - 16x9  –  $4.99

Environment Social Governance 02 PowerPoint Template

Environment Social Governance 02 Presentation Template Use this Environment Social Governance 02 PowerPoint template to create visually appealing....

•   ESG 01 - 4x3  –  $6.99
•   ESG 01 - 16x9  –  $6.99

ESG 01 PowerPoint Template

ESG 01 Presentation Template Use this ESG 01 PowerPoint template to create visually appealing presentations in any professional setting. Its mini....

•   ESG-02 - 4x3  –  $4.99
•   ESG-02 - 16x9  –  $4.99

ESG 02 PowerPoint Template

ESG 02 Presentation Template Use this ESG 02 PowerPoint template to create visually appealing presentations in any professional setting. Its mini....

•   Sustainable Initiatives PowerPoint Template - 4x3  –  $4.99
•   Sustainable Initiatives PowerPoint Template - 16x9  –  $4.99

Sustainable Initiatives PowerPoint Template

Sustainable Initiatives Presentation Template Use this Sustainable Initiatives PowerPoint template to create visually appealing presentations in ....

•   Sustainability-Quote-PowerPoint-Template - 4x3  –  $4.99
•   Sustainability-Quote-PowerPoint-Template - 16x9  –  $4.99

Sustainability Quote PowerPoint Template

Sustainability Quote Presentation Template Use this Sustainability Quote PowerPoint template to create visually appealing presentations in any pr....

•   Green-Sustainability-PowerPoint-Template - 4x3  –  $4.99
•   Green-Sustainability-PowerPoint-Template - 16x9  –  $4.99

Green Sustainability PowerPoint Template

Green Sustainability Presentation Template Use this Green Sustainability PowerPoint template to create visually appealing presentations in any pr....

•   Recycle-Diagram-PowerPoint-Template - 4x3  –  $4.99
•   Recycle-Diagram-PowerPoint-Template - 16x9  –  $4.99

Recycle Diagram PowerPoint Template

Recycle Diagram Presentation Template Use this Recycle Diagram PowerPoint template to create visually appealing presentations in any professional....

•   Simple-Recycle-PowerPoint-Template - 4x3  –  $4.99
•   Simple-Recycle-PowerPoint-Template - 16x9  –  $4.99

Simple Recycle PowerPoint Template

About Simple Recycle PowerPoint Template The best-in-class Simple Recycle Template for PowerPoint is a slide set with recycled logos designed in ....

•   World Environment Day 02 - 4x3  –  $4.99
•   World Environment Day 02 - 16x9  –  $4.99

World Environment Day 02 PowerPoint Template

World Environment Day 02 Presentation Template Use this World Environment Day 02 PowerPoint template to create visually appealing presentations i....

•   World Environment Day 03 - 4x3  –  $4.99
•   World Environment Day 03 - 16x9  –  $4.99

World Environment Day 03 PowerPoint Template

World Environment Day 03 Presentation Template Use this World Environment Day 03 PowerPoint template to create visually appealing presentations i....

Related Presentations

Human resource.

920 templates >

Sustainability

28 templates >

19 templates >

5,698 templates >

SWOT Analysis

130 templates >

ESG PowerPoint Templates For Presentations:

The ESG PowerPoint templates go beyond traditional static slides to make your professional presentations stand out. Given the sleek design and customized features, they can be used as PowerPoint as well as  Google Slides templates . Inculcated with visually appealing unique and creative designs, the templates will double your presentation value in front of your audience. You can browse through a vast library of ESG Google Slides templates,  PowerPoint themes  and  backgrounds  to stand out in your next presentation.

Product Pricing

What is a esg powerpoint template.

A ESG PowerPoint template is a ready-made presentation template that provides a structured framework for creating professional ESG presentations. The ESG PPT presentation template includes design elements, layouts, and fonts that you can customize to fit your content and brand.

How To Choose The Best ESG Presentation Templates?

Keep the following points in mind while choosing a ESG Presentation template for PowerPoint (PPT) or Google Slides:

• Understand your presentation goals and objectives.
• Make sure the ESG template aligns with your visual needs and appeal.
• Ensure the template is versatile enough to adapt to various types of content.
• Ensure the template is easily customizable.

Are ESG PowerPoint Templates Compatible With Google Slides?

Yes, all our ESG presentation templates are compatible and can be used as ESG Google Slides templates.

What Are The Advantages Of ESG Presentation Templates?

ESG PPT presentation templates can be beneficial because they:

• Add multiple visual and aesthetic layers to your slides.
• Ensure that complex information, insights and data is presented in a simplistic way.
• Enhance the overall visual appeal of the content.
• Save you a lot of time as you don’t have to start editing from scratch.
• Improve the professional outlook of your presentation.

Can I Edit The Elements In ESG PowerPoint Templates?

Yes, our ESG PowerPoint and Google Slides templates are fully editable. You can easily modify the individual elements including icons, fonts, colors, etc. while making your presentations using  professional PowerPoint templates .

How To Download ESG PowerPoint Templates For Presentations?

To download ESG presentation templates, you can follow these steps:

• Select the resolution (16*9 or 4*3).
• Select the format you want to download the ESG template in (Google Slides or PowerPoint).
• Make the payment (SlideUpLift has a collection of paid as well as free ESG PowerPoint templates).
• You can download the file or open it in Google Slides.

Forgot Password?

Privacy Overview

Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information

Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.

Does ESG really matter—and why?

Since the acronym “ESG”  (environmental, social, and governance) was coined in 2005, and until recently, its fortunes were steadily growing. To take one example, there has been a fivefold growth in internet searches for ESG since 2019, even as searches for “CSR” (corporate social responsibility)—an earlier area of focus more reflective of corporate engagement than changes to a core business model—have declined. Across industries, geographies, and company sizes, organizations have been allocating more resources toward improving ESG. More than 90 percent of S&P 500 companies now publish ESG reports  in some form, as do approximately 70 percent of Russell 1000 companies. 1 Sustainability reporting in focus , G&A Institute, 2021. In a number of jurisdictions, reporting ESG elements is either mandatory or under active consideration. In the United States, the Securities and Exchange Commission (SEC) is considering new rules that would require more detailed disclosure of climate-related risks and greenhouse-gas (GHG) emissions. 2 Release Nos. 33-11042, 34-94478, File No. S7-10-22, US Securities and Exchange Commission (SEC), March 21, 2022. The proposed rule would not come into effect until fiscal year 2023 and could face legal challenges; “We are not the Securities and Environment Commission—At least not yet,” statement of Commissioner Hester M. Peirce, SEC, March 21, 2022; Dan Papscun, “SEC’s climate proposal tees up test of ‘material’ info standard,” Bloomberg Law, March 23, 2022. Additional SEC regulations on other facets of ESG have also been proposed or are pending. 3 See “SEC response to climate and ESG risks and opportunities,” SEC, modified April 11, 2022; “SEC proposes to enhance disclosures by certain investment advisers and investment companies about ESG investment practices,” SEC press release, May 25, 2022.

The rising profile of ESG has also been plainly evident in investments, even while the rate of new investments has recently been falling. Inflows into sustainable funds, for example, rose from $5 billion in 2018 to more than $50 billion in 2020—and then to nearly $70 billion in 2021; these funds gained $87 billion of net new money in the first quarter of 2022, followed by $33 billion in the second quarter. 4 “Global Sustainable Fund Flows: Q2 2022 in Review,” Morningstar Manager Research, July 28, 2022; Cathy Curtis, “Op-ed: While green investments are underperforming, investors need to remain patient,” CNBC, March 28, 2022. Midway through 2022, global sustainable assets are about $2.5 trillion. This represents a 13.3 percent fall from the end of Q1 2022 but is less than the 14.6 percent decline over the same period for the broader market. 5 “Global Sustainable Fund Flows: Q2 2022 in Review,” Morningstar Manager Research, July 28, 2022; Cathy Curtis, “Op-ed: While green investments are underperforming, investors need to remain patient,” CNBC, March 28, 2022.

A major part of ESG growth has been driven by the environmental component of ESG and responses to climate change. But other components of ESG, in particular the social dimension, have also been gaining prominence. One analysis found that social-related shareholder proposals rose 37 percent in the 2021 proxy season compared with the previous year. 6 Richard Vanderford, “Shareholder voices poised to grow louder with SEC’s help,” Wall Street Journal , February 11, 2022.

In the wake of the war in Ukraine and the ensuing human tragedy, as well as the cumulative geopolitical, economic, and societal effects, critics have argued that the importance of ESG has peaked. 7 Simon Jessop and Patturaja Murugaboopathy, “Demand for sustainable funds wanes as Ukraine war puts focus on oil and gas,” Reuters, March 17, 2022; Peggy Hollinger, “Ukraine war prompts investor rethink of ESG and the defence sector,” Financial Times , March 9, 2022. Attention, they contend, will shift increasingly to the more foundational elements of a Maslow-type hierarchy of public- and private-sector needs, 8 Bérengère Sim, “Ukraine war ‘bankrupts’ ESG case, says BlackRock’s former sustainable investing boss,” Financial News , March 14, 2022. and in the future, today’s preoccupation with ESG may be remembered as merely a fad and go the way of similar acronyms that have been used in the past. 9 Charles Gasparino, “Russian invasion sheds light on hypocrisy of Gary Gensler, woke investment,” New York Post , March 5, 2022; James Mackintosh, “Why the sustainable investment craze is flawed,” Wall Street Journal , January 23, 2022; David L. Bahnsen, “Praying that ESG goes MIA,” National Review , March 17, 2022. Others have argued that ESG represents an odd and unstable combination of elements and that attention should be only focused on environmental sustainability. 10 See, for example, “ESG should be boiled down to one simple measure: emissions,” Economist , July 21, 2022. In parallel, challenges to the integrity of ESG investing have been multiplying. While some of these arguments have also been directed to policy makers, analysts, and investment funds, the analysis presented in this article (and in the accompanying piece “ How to make ESG real ”) is focused at the level of the individual company. In other words: Does ESG really matter to companies ? What is the business-grounded, strategic rationale?

A critical lens on ESG

Criticisms of ESG are not new. As ESG has gone mainstream and gained support and traction, it has consistently encountered doubt and criticism as well. The main objections fall into four main categories.

1. ESG is not desirable, because it is a distraction

Perhaps the most prominent objection to ESG has been that it gets in the way of what critics see as the substance of what businesses are supposed to do: “make as much money as possible while conforming to the basic rules of the society,” as Milton Friedman phrased it more than a half-century ago.” 11 Milton Friedman, “The social responsibility of business to increase its profits,” New York Times Magazine , September 13, 1970. Viewed in this perspective, ESG can be presented as something of a sideshow—a public-relations move, or even a means to cash in on the higher motives of customers, investors, or employees. ESG is something “good for the brand” but not foundational to company strategy. It is additive and occasional. ESG ratings and score provider MSCI, for example, found that nearly 60 percent of “say on climate” votes 12 Say-on-climate votes are generally nonbinding resolutions submitted to shareholders (similar to “say-on-pay” resolutions), which seek shareholder backing for emissions reductions initiatives. See, for example, John Galloway, “Vanguard insights on evaluating say on climate proposals,” Harvard Law School Forum of Corporate Governance, June 14, 2021. in 2021 were only one-time events; fewer than one in four of these votes were scheduled to have annual follow-ups. 13 “Say on climate: Investor distraction or climate action?,” blog post by Florian Sommer and Harlan Tufford, MSCI, February 15, 2022. Other critics have cast ESG efforts as “greenwashing,” “purpose washing,” 14 Laurie Hays, et al., “Why ESG can no longer be a PR exercise,” Harvard Law School Forum on Corporate Governance, January 20, 2021. or “woke washing.” 15 See Owen Jones, “Woke-washing: How brands are cashing in on the culture wars,” Guardian , May 23, 2019; Vivek Ramaswamy, Woke Inc.: Inside Corporate America’s Social Justice Scam , New York, NY: Hachette Book Group, 2021. One Edelman survey, for example, reported that nearly three out of four institutional investors do not trust companies to achieve their stated sustainability, ESG, or diversity, equity, and inclusion (DEI) commitments. 16 Special report: Institutional investors , Edelman Trust Barometer, 2021.

2. ESG is not feasible because it is intrinsically too difficult

A second critique of ESG is that, beyond meeting the technical requirements of each of the E, S, and G components, striking the balance required to implement ESG in a way that resonates among multiple stakeholders is simply too hard. When solving for a financial return, the objective is clear: to maximize value for the corporation and its shareholders. But what if the remit is broader and the feasible solutions vastly more complex? Solving for multiple stakeholders can be fraught with trade-offs and may even be impossible. To whom should a manager pay the incremental ESG dollar? To the customer, by way of lower prices? To the employees, through increased benefits or higher wages? To suppliers? Toward environmental issues, perhaps by means of an internal carbon tax? An optimal choice is not always clear. And even if such a choice existed, it is not certain that a company would have a clear mandate from its shareholders to make it.

3. ESG is not measurable, at least to any practicable degree

A third objection is that ESG, particularly as reflected in ESG scores, cannot be accurately measured. While individual E, S, and G dimensions can be assessed if the required, auditable data are captured, some critics argue that aggregate ESG scores have little meaning. The deficiency is further compounded by differences of weighting and methodology across ESG ratings and scores providers. For example, while credit scores of S&P and Moody’s correlated at 99 percent, ESG scores across six of the most prominent ESG ratings and scores providers correlate on average by only 54 percent and range from 38 percent to 71 percent. 17 Florian Berg, Julian Kölbel, and Roberto Rigobon, “Aggregate confusion: The divergence of ESG ratings,” Review of Finance , forthcoming, updated April 26, 2022. Moreover, organizations such as the Global Reporting Initiative (GRI) and the Sustainability Accounting Standards Board (SASB) can measure the same phenomena differently; for example, GRI considers employee training, in part, by amounts invested in training, while SASB measures by training hours. It is to be expected, therefore, that different ratings and scores providers—which incorporate their own analyses and weightings—would provide diverging scores. Moreover, major investors often use their own proprietary methodologies that draw from a variety of inputs (including ESG scores), which these investors have honed over the years.

4. Even when ESG can be measured, there is no meaningful relationship with financial performance

The fourth objection to ESG is that positive correlations with outperformance, when they exist, could be explained by other factors and, in any event, are not causative. It would indeed challenge reason if ESG ratings across ratings and scores providers, measuring different industries, using distinct methodologies, weighting metrics differently, and examining a range of companies that operate in various geographies, all produced a near-identical score that almost perfectly matched company performance. Correlations with performance could be explained by multiple factors (for example, industry headwinds or tailwinds) and are subject to change. 18 See, for example, James Mackintosh, “Credit Suisse shows flaws of trying to quantify ESG risks,” Wall Street Journal , January 17, 2022. Several studies have questioned any causal link between ESG performance and financial performance. 19 See, for example, Chart of the Week , “Does ESG outperform? It’s a challenging question to answer,” blog post by Raymond Fu, Penn Mutual, September 23, 2021; Gregor Dorfleitner and Gerhard Halbritter, “The wages of social responsibility—where are they? A critical review of ESG investing,” Review of Financial Economics , Volume 26, Issue 1, September 2015. While, according to a recent metastudy, the majority of ESG-focused investment funds do outperform the broader market, 20 Ulrich Atz, Casey Clark, and Tensie Whelan, ESG and financial performance: Uncovering the relationship by aggregating evidence from 1,000 plus studies published between 2015 – 2020 , NYU Stern Center for Sustainable Business, 2021. some ESG funds do not, and even those companies and funds that have outperformed could well have an alternative explanation for their outperformance. (For example, technology and asset-light companies are often among broader market leaders in ESG ratings; because they have a relatively low carbon footprint, they tend to merit higher ESG scores.) The director of one recent study 21 Giovanni Bruno, Mikheil Esakia, and Felix Goltz, “‘Honey, I shrunk the ESG alpha’: Risk-adjusting ESG portfolio returns,” Journal of Investing , April 2022. proclaimed starkly: “There is no ESG alpha.” 22 Steve Johnson, “ESG outperformance narrative ‘is flawed,’ new research shows,” Financial Times , May 3, 2021.

In addition to these four objections, recent events and roiled markets have led some to call into question the applicability of ESG ratings at this point. 23 See James Mackintosh, “War in Ukraine reveals flaws in sustainable investing,” Wall Street Journal , March 27, 2022. It is true that the recognized, pressing need to strengthen energy security in the wake of the invasion of Ukraine may lead to more fossil-fuel extraction and usage in the immediate term, and the global collaboration required for a more orderly net-zero transition  may be jeopardized by the war and its aftermath. It is also likely that patience for what may be called “performative ESG,” as opposed to what may be called true ESG, will likely wear thin. True ESG is consistent with a judicious, well-considered strategy that advances a company’s purpose and business model (exhibit).

Yet, many companies today are making major decisions, such as discontinuing operations in Russia, protecting employees in at-risk countries, organizing relief to an unprecedented degree, and doing so in response to societal concerns. They also continue to commit to science-based targets and to define and execute plans for realizing these commitments. That indicates that ESG considerations are becoming more —not less—important in companies’ decision making.

Sustainable performance is not possible without social license

The fundamental issue that underlies each of the four ESG critiques is a failure to take adequate account of social license—that is, the perception by stakeholders that a business or industry is acting in a way that is fair, appropriate, and deserving of trust. 24 “‘Corporate diplomacy’: Why firms need to build ties with external stakeholders,” Knowledge at Wharton , May 5, 2014; and Witold J. Henisz, Corporate Diplomacy: Building Reputations and Relationships with External Stakeholders , first edition, London, UK: Routledge, 2014; see also Robert G. Boutilier, “Frequently asked questions about the social license to operate,” Impact Assessment and Project Appraisal , Volume 32, Issue 4, 2014. It has become dogma to state that businesses exist to create value in the long term. If a business does something to destroy value (for example, misallocating resources on “virtue signaling,” or trying to measure with precision what can only be imperfectly estimated, at least to date, through external scores), we would expect that criticisms of ESG could resonate, particularly when one is applying a long-term, value-creating lens.

But what some critics overlook is that a precondition for sustaining long-term value is to manage, and address, massive, paradigm-shifting externalities . Companies can conduct their operations in a seemingly rational way, aspire to deliver returns quarter to quarter, and determine their strategy over a span of five or more years. But if they assume that the base case does not include externalities or the erosion of social license by failing to take externalities into account, their forecasts—and indeed, their core strategies—may not be achievable at all. Amid a thicket of metrics, estimates, targets, and benchmarks, managers can miss the very point of why they are measuring in the first place: to ensure that their business endures, with societal support, in a sustainable, environmentally viable way.

ESG ratings: Does change matter?

Among the most sharply debated questions about environmental, social, and governance (ESG) is the extent to which ESG, as measured by ratings, can offer meaningful insights about future financial or TSR performance—particularly when ratings and scores providers use different, and sometimes mutually inconsistent, methodologies. A number of studies find a positive relationship between ESG ratings and financial performance. 1 Florian Berg, Julian Kölbel, and Roberto Rigobon, “Aggregate confusion: The divergence of ESG ratings,” Review of Finance, forthcoming, updated April 2022; Ulrich Atz, Casey Clark, and Tensie Whelan, ESG and financial performance: Uncovering the relationship by aggregating evidence from 1,000 plus studies published between 2015–2020 , NYU Stern Center for Sustainable Business, 2021. Other research suggests that while scoring well in ESG does not destroy financial value, the relationship between ESG ratings at any given time, and value creation at the identical time, can be tenuous or nonexistent. 2 See Chart of the Week , “Does ESG outperform? It’s a challenging question to answer,” blog post by Raymond Fu, Penn Mutual, September 23, 2021; Giovanni Bruno, Mikheil Esakia, and Felix Goltz, “‘Honey, I shrunk the ESG alpha’: Risk-adjusting ESG portfolio returns,” Journal of Investing , April 2022. Because of the short time frame over which the topic has been studied, and the resulting lack of robust analyses, conclusions from the analyses should be tempered. 3 When the ESG characteristic of a company changes, based on MSCI ESG data, it may be a useful financial indicator for generating alpha. Guido Giese et al., “Foundations of ESG investing: How ESG affects equity valuation, risk, and performance,” Journal of Portfolio Management , July 2019, Volume 45, Number 5.

In exploring the connection between ESG ratings and financial performance, another approach is to look at the effect of a change in ESG ratings. This approach mitigates issues deriving from differences among various ESG rating methodologies (assuming the methodologies are relatively consistent over time). It stands to reason that demonstrating real improvement—if reflected in the scores—could, in turn, drive TSR outperformance for multiple reasons, including those we explore in this article. Our initial research indicates, however, that it is too soon to tell. We found that on average companies that show an improvement in ESG ratings over multiyear time periods may exhibit higher shareholder returns compared with industry peers in the period after the improvement in ESG scores. We found, too, that the effect of this result has increased in recent years (exhibit). This initial finding is in line with some of the recent academic research and was also generally consistent across data from multiple ratings and scores providers.

Still, the findings are not yet conclusive. For example, only 54 percent of the companies we categorize as “improvers” and less than one-half of those categorized as “slight improvers” demonstrated a positive excess TSR. The research also does not prove causation. It is important to bear in mind that ESG scores are still evolving, observations in the aggregate may be less applicable to companies considered individually, and exogenous factors such as headwinds and tailwinds in industries and individual companies cannot be fully controlled for.

Most important, this research does not explain the mechanism of TSR outperformance and whether the outperformance is sustainable. We know from decades of research that companies with a higher expected return on capital and growth are ultimately TSR outperformers and that there is clear, statistically significant correlation. Are ESG ratings a sign of greater expected resilience of margins in the transition, an indication of higher growth through green portfolios—or do they suggest something else? Will these increased expectations relative to peers ultimately materialize, or will they revert to the mean? ESG ratings are very new compared with financial ratings, and therefore, it will take time for them to evolve. We will continue to research these questions as data sets increase and refinements to ESG scores continue to be refined.

Regardless of current ratings scores, many companies are already advancing in ESG to improve their long-term financial performance. High performers consider and seek to learn from ESG ratings, but they do not get unduly distracted or make superficial changes merely to score higher. Companies should focus on ESG improvements that matter most to their business models, even if the improvements do not directly translate to higher ratings.

Since conclusions about the relationship between ESG ratings and financial performance are not yet certain, they might not be compelling enough, on their own, to persuade executives to invest significant resources in ESG. But there is a tangible cost to waiting. In fact, companies should adopt a bias toward focusing on ESG today ; if companies, particularly those with significant externalities (such as high-emitting industries), hold out for perfect data and a “flawless” rating process, they may not have a business in 20 to 30 years.

Accordingly, the responses to ESG critics coalesce on three critical points: the acute reality of externalities, the early success of some organizations, and the improvement of ESG measurements over time. And the case for ESG cannot be dismissed by connections between ESG scores and financial performance and changes in ESG scores over time. (For a discussion about ESG ratings and their relationship to financial performance, see sidebar, “ESG ratings: Does change matter?”)

1. Externalities are increasing

Company actions can have meaningful consequences for people who are not immediately involved with the company. Externalities such as a company’s GHG emissions, effects on labor markets, and consequences for supplier health and safety are becoming an urgent challenge in our interconnected world. Regulators clearly take notice. 25 See, for example, Sinziana Dorobantu, Witold J. Henisz and Lite J. Nartey, “Spinning gold: The financial returns to stakeholder engagement,” Strategic Management Journal , December 2014, Volume 35, Issue 12. Even if some governments and their agencies demand changes more quickly and more forcefully than others, multinational businesses, in particular, cannot afford to take a wait-and-see approach. To the contrary, their stakeholders expect them to take part now in how the regulatory landscape, and broader societal domain, will likely evolve. More than 5,000 businesses , for example, have made net-zero commitments as part of the United Nations’ “Race to Zero” campaign. Workers are also increasingly prioritizing factors such as belonging and inclusion  as they choose whether to remain with their company or join a competing employer. 26 ” ‘Great Attrition’ or ‘Great Attraction’? The choice is yours ,” McKinsey Quarterly , September 8, 2021. Many companies, in turn, are moving aggressively to reallocate resources and operate differently; nearly all are feeling intense pressure to change. Even before the Ukraine war induced dramatic company action, the pandemic had prompted companies to reconsider and change core business operations. Many have embarked on a similar path with respect to climate change. This pressure, visceral and tangible, is an expression of social license—and it has been made more pressing as rising externalities have become more urgent.

2. Some companies have performed remarkably, showing that ESG success is indeed possible

Social license is not static, and companies do not earn the continued trust of consumers, employees, suppliers, regulators, and other stakeholders based merely upon prior actions. Indeed, earning social capital is analogous to earning debt or equity capital—those who extend it look to past results for insights about present performance and are most concerned with intermediate and longer-term prospects. Yet unlike traditional sources of capital, where there are often creative financing alternatives, there are ultimately no alternatives for companies that do not meet the societal bar and no prospect of business as usual, or business by workaround, under conditions of catastrophic climate change.

Because ESG efforts are a journey, bumps along the way are to be expected. No company is perfect. Key trends can be overlooked, errors can be made, rogue behaviors can manifest themselves, and actions can have unintended consequences. But since social license is corporate “oxygen”—thus impossible to survive without it—companies cannot just wait and hope that things will all work out. Instead, they need to get ahead of future issues and events by building purpose into their business models and demonstrating that they benefit multiple stakeholders and the broader public. Every firm has an implicit purpose—a unique raison d’être that answers the question, “What would the world lose if this company disappeared?” Companies that embed purpose in their business model not only mitigate risk; they can also create value from their values. For example, Patagonia, a US outdoor-equipment and clothing retailer, has always been purpose driven—and announced boldly that it is “in business to save our home planet.” Natura &Co, a Brazil-based cosmetics and personal-care company in business to “promote the harmonious relationship of the individual with oneself, with others and with nature,” directs its ESG efforts to initiatives such as protecting the Amazon, defending human rights, and embracing circularity. Multiple other companies, across geographies and industries, are using ESG to achieve societal impact and ancillary financial benefits, as well.

3. Measurements can be improved over time

While ESG measurements are still a work in progress, it is important to note that there have been advancements. ESG measurements will be further improved over time. They are already changing; there is a trend toward consolidation of ESG reporting and disclosure frameworks (though further consolidation is not inevitable). Private ratings and scores providers such as MSCI, Refinitiv, S&P Global, and Sustainalytics, for their part, are competing to provide insightful, standardized measures of ESG performance.

There is also a trend toward more active regulation with increasingly granular requirements. Despite the differences in assessing ESG, the push longitudinally has been for more accurate and robust disclosure, not fewer data points or less specificity. It is worth bearing in mind, too, that financial accounting arose from stakeholder pull, not from spontaneous regulatory push, and did not materialize, fully formed, along the principles and formats that we see today. Rather, reporting has been the product of a long evolution—and a sometimes sharp, debate. It continues to evolve—and, in the case of generally accepted accounting principles (GAAP) and International Financial Reporting Standards (IFRS) reporting, continues to have differences. Those differences, reflecting how important these matters are to stakeholders, do not negate the case for rigorous reporting—if anything, they strengthen it.

While the acronym ESG as a construct may have lost some of its luster, its underlying proposition remains essential at the level of principle. Names will come and go (ESG itself arose after CSR, corporate engagement, and similar terms), and these undertakings are by nature difficult and can mature only after many iterations. But we believe that the importance of the underlying ideas has not peaked; indeed, the imperative for companies to earn their social license appears to be rising. Companies must approach externalities as a core strategic challenge, not only to help future-proof their organizations but to deliver meaningful impact over the long term.

Lucy Pérez is a senior partner in McKinsey’s Boston office; Vivian Hunt is a senior partner in the London office; Hamid Samandari is a senior partner in the New York office; Robin Nuttall  is a partner in the London office; and Krysta Biniek is a senior expert in the Denver office.

The authors wish to thank Donatela Bellone, Elena Gerasimova, Ashley Gorman, Celine Guo, Pablo Illanes, Conor Kehoe, Tim Koller, Lazar Krstic, Burak Ovali, Werner Rehm, and Sophia Savas for their contributions to this article.

This article was edited by David Schwartz, an executive editor in the Tel Aviv office.

Explore a career with us

Related articles.

The role of ESG and purpose

The ESG premium: New perspectives on value and performance

Why ESG is here to stay

• SUGGESTED TOPICS
• The Magazine
• Newsletters
• Managing Yourself
• Managing Teams
• Work-life Balance
• The Big Idea
• Data & Visuals
• Reading Lists
• Case Selections
• HBR Learning
• Topic Feeds
• Account Settings
• Email Preferences

It’s Time to Change How ESG Is Measured

• Lauren Cohen,
• Umit G. Gurun,
• Quoc Nguyen

Creating separate ratings for E, S, and G would benefit firms, investors, and policymakers.

Estimates suggest ESG investing could surpass $50 trillion by 2025, as investors around the world look for opportunities for their investment capital to have a broader social impact. However, research suggests that ESG ratings suffer from a measurement trap that occurs when a metric used as part of the rating is systematically biased towards certain industries or types of companies. This trap can manifest in three ways: 1) The rater focuses on what can easily be measured; 2) The rater overly simplifies the feature to be measured into an existing categorical framework; or 3) The rater tries to distill rich multi-dimensional data into a single number. A two-pronged solution can improve transparency, efficiency, and effectiveness, creating a win-win-win-win scenario for firms, investors, policymakers, and the world more broadly.

A large and growing proportion of global investors are looking for vehicles that take into consideration not only their investments’ financial returns but also the investment capitals’ ability to have a broader societal impact. This trend has propelled environmental, social, and governance (ESG) investing to the forefront of the financial sector. By December 2020, ESG-linked assets had surged to constitute one-third of the $51 trillion U.S. assets under professional management, with predictions suggesting it could surpass $50 trillion by 2025.  

• Lauren Cohen is the L.E. Simmons professor in the finance & entrepreneurial management units at Harvard Business School and a research associate at the National Bureau of Economic Research.
• Umit G. Gurun is the Stan Liebowitz professor of finance and accounting at the Naveen Jindal School of Management at the University of Texas at Dallas.
• Quoc Nguyen is an assistant professor of finance at the Kellstadt Graduate School of Business at DePaul University.

Partner Center

What is ESG investing?

• Best SRI apps

Types of ESG investments

• Pros and cons
• ESG vs. SRI
• The bottom line

A beginners guide to ESG investing: Understanding the power of ESG investing in your portfolio

Paid non-client promotion: Affiliate links for the products on this page are from partners that compensate us (see our advertiser disclosure with our list of partners for more details). However, our opinions are our own. See how we rate investing products to write unbiased product reviews.

• ESG investing is a type of investing that considers a company's sustainability and societal impact.
• Impact investing allows investors to support companies conducting ethical and sustainable business practices in the hope that it encourages others to do the same. 
• ESG funds can be just as lucrative as traditional funds and are generally lower risk than other market offerings. 

Sustainable investing allows folks to invest in target companies whose values align with their own. As impact investing has evolved and expanded, so have the opportunities for investors to build portfolios they truly believe in.

You can invest in ESG stocks and funds with some of the best online brokerages like Betterment and Ellevest. 

Here's how ESG investing works and what brokerages are offering socially responsible investing options. 

ESG investing is a type of socially responsible investing that allows you to support businesses that align with your environmental, social, and governance views. An institution's priorities could be anything from reducing carbon emissions to providing community outreach initiatives, which all fall under the umbrella of ESG investing.

Individual companies or assets are then rated on how well they adhere to the ESG guidelines. Each letter that makes up the ESG acronym stands for one of the three factors used to assess and rank a given investment.

• Environmental: Conservation efforts aimed at protecting the Earth and our natural environment, including emissions and air quality, waste management, land usage, and energy footprint.
• Social: A look at the company's connective tissues, including on-site labor practices, safety standards, community outreach, equal employment opportunities, and product quality.
• Governance:  A snapshot of the standards that leadership is held to, including ethical business practices, board diversity, executive compensation vs. employee pay, and overall transparency.

"An investor that holds socially responsible characteristics as their top priority when investing, and has a limited amount of time to conduct research on their own, should consider opening an account through a socially responsible investment app," says Sandra Cho RIA, wealth manager, and CEO of  Pointwealth Capital Management . "For this type of investor, the fee for the platform is worth it, as the investor will save hours of time not having to do the research on their own."

Despite all these bars to clear, ESG funds can be just as lucrative as traditional funds and are generally lower risk compared to other market offerings. 

Best socially responsible investing apps

A great way to ESG investing opportunities is through some of the best socially responsible investing apps, including: 

• Wealthfront
• Interactive Brokers
• Betterment Investing
• Sustainfolio
• Ellevest Investing
• Charles Schwab
• Ally Invest

The investment platforms and brokerages offer a variety of ESG funds, various portfolio options, educational resources, low fees, and more. Like many of the best free stock trading apps , you can open a brokerage account with a bank or investment platform that offers sustainable investing or ESG investing portfolio options.

"An investor that holds socially responsible characteristics as their top priority when investing, and who has a limited amount of time to conduct research on their own, should consider opening an account through a socially responsible investment app," states Cho.

Although socially responsible investing apps offer an accessible way for investors to support ethical business practices and similarly related issues, it's still in your best interest to research the institutions you're investing in and ensure that their values align with yours.

History of ESG investing

While the term wasn't coined until the 2000s, the practice of ESG investing stretches back much further. It began with religious groups such as Muslims, Quakers, and Methodists who avoided businesses dealing in alcohol, tobacco, and gambling and wanted their portfolios to do the same.

ESG investing has been adopted by other groups looking to align their investments and their beliefs, from the Vietnam anti-war movement in the 1960s and 1970s to a call for corporate accountability in the '80s and climate change initiatives in the 1990s. 

For those who want to explore promising ESG investments, scores of highly rated options exist in each category. To give you an idea, here are a few worth exploring:

• Environmental ESG investments: iShares Global Clean Energy ETF ( ICLN ) — tracks the S&P Global Clean Energy Index, providing exposure to companies pursuing renewable resources
• Social ESG investments: Vanguard FTSE Social Index Fund Admiral ( VFTAX ) — an inexpensive option that works only with companies with clean labor and human rights records
• Corporate Governance ESG investments: iShares ESG MSCI USA ETF ( ESGU ) — subjects each of its investments to a corporate governance review.

Other market leaders that aren't specific to a certain category include:

• iShares MSCI USA ESG Select ETF ( SUSA )
• Natixis Sustainable Future 2025 N ( NSFEX )
• Shelton Green Alpha Fund ( NEXTX )
• Vanguard ESG US Stock ETF ( ESGV )
• Xtrackers MSCI USA ESG Leaders Equity ETF ( USSG )

Finding ESG opportunities

You can find more ESG funds and follow current trends with resources like MSCI , a financial services company dedicated to corporate responsibility. There, you'll find an entire vertical stocked with the latest research on ESG investing, including data and ratings.

When it comes to ratings, no one method has yet been adopted industry-wide, but companies like Morningstar, MSCI, Bloomberg, and Sustainalytics are all popular data providers.

Morningstar's methodology is a tri-pronged equation that gives you a number between one and 100, rating the amount of ESG risk carried by that investment:

• 0-9.99: Negligible ESG Risk
• 10-19.99: Low ESG Risk
• 20-29.99: Medium ESG Risk
• 30-39.99: High ESG Risk
• 40+: Severe ESG Risk

You can also use online trading programs to find and build a portfolio based on ESG Investments, like BTheChange.com, which breaks investments into five categories: those best for the environment, community, governance, workers, and customers.

Pros and cons of ESG investing

The main advantage of socially responsible investing apps is that you can support businesses with morals and ethics that align with your own views.

Rather than investing in large tech companies or businesses participating in unethical business practices, you can make a positive impact by supporting institutions dedicated to sustainability, community outreach, environmental conservation efforts, and ethical business practices.

Moreover, funding these businesses may encourage them to continue supporting sustainable and ethical policies.

However, you may not get the most you can out of your investment portfolio. Just because a business has good morals and ethical business practices doesn't guarantee it will have high rewards. There's still a possibility that your investments will fail or produce smaller returns compared to other sectors of the market. 

ESG funds can also be pricey. "This fee covers the platform's cost of research, analysis, and other operating expenses," says Cho. "Compared to a standard platform that allows investors to open an account for free, this a significant disadvantage."

ESG investing vs. Socially responsible investing

The terms ESG investing and socially responsible investing (SRI) are often used interchangeably in the investing space, and they do have a fair amount of overlap. For each strategy, investors make decisions based on social impact instead of rates of return alone, and both represent ways of making your voice heard as a conscious investor. 

It's in the method where the two factions diverge.

SRI relies on excluding problematic investments from your portfolio. If one of your passions is carceral reform, for example, and it's revealed that a successful company exploits prison labor for its profits, you wouldn't invest in that company no matter how high its profits soared. 

With ESG, things are less black and white. The strategy is based on a rating system, and while higher-ranked investments are preferred, there's no rule that states you can't invest in a lower-ranked company. Because of this flexibility and potential for customization, investors often don't have to choose between their morals and bottom line but can incorporate both.

Finally, there's a third term at work: impact investing. In direct opposition to SRI, this method adopts an inclusive technique, seeking out companies that work toward specific goals for social betterment, like eradicating world hunger or poverty.

Why does ESG investing matter?

ESG investing allows individual investors to engage with the market and the economy in small but marked ways, aligning with businesses that share their values, a process known as conscious capitalism. 

As the practice spreads and increasingly larger groups use ESG investing, it allows socially conscious investors to put pressure on corporations from the inside via shareholder activism — using their influence as partial owners to encourage businesses toward a brighter, more sustainable future.  

In March 2021, the SEC created a task force focused on climate, other ESG issues, and accountability standards. The initiative comes as companies are setting their own ESG goals in a larger push to define ESG.

What is ethical consumerism?

Ethical consumerism, while similar to ESG investing, is not quite the same thing. There are several ways to think about ethical consumerism. At face value, ethical consumerism is the idea that your consumption has an impact on the world, so you want that impact to align with your values. This means understanding the footprint of the products you consume, how they were made, and how they will be disposed of. 

An extension of this is known as dollar voting, in which you view your money as a statement to companies. For example, when you buy sustainable products, you're signaling to companies that its customers care about these kinds of products — there's a market for it.

Similarly, you can refrain from buying from companies that engage in activities that don't align with your values, such as unfair labor practices or unsustainable production methods.

ESG investing — Frequently asked questions (FAQs)

ESG investing, or sustainable investing, is when you invest in companies dedicated to making positive social and ethical changes. By participating in ESG investing, you're investing in stocks or mutual funds of companies that align wither your environmental, social, and governance views. 

An example of a socially responsible investment is buying stock in a business or institution engaged in environmental sustainability and alternative energy practices. These institutions focus on developing sustainable (aka clean) energy, such as wind or solar. 

Whether ESG funds are a good investment or not depends on your investing goals and priorities. ESG funds are ideal options for those who want to make a positive difference with their investments. IMPACT, for instance, allows investors to filter out companies that practice animal testing, high water use, and more. 

Characteristics of a socially responsible investment are often shares of a company or business that positively impact the community. Positive impacts can be political, social, or environmental actions that often coincide with current trends. 

Vanguard does offer several ESG investment options. Vanguard offers several ESG investment options, including equity ESG index funds and fixed-income ESG products. 

Is ESG investing worth it?

ESG investing is a sustainable approach to the market, which weighs an investment's impact in environmental, social, and corporate governance spheres more heavily than it does its profitability. 

Cho recommends that investors pursuing ESG funds ensure they are familiar with all the risks involved.

"I would make sure that socially responsible characteristics are of paramount importance to them," says Cho. "I would also make sure that they understand the fees associated with the app that they choose and how that can impact long-term returns."

Luckily, more online brokerages and investment platforms have started offering socially responsible investments as an option for taxable brokerage accounts and even IRAs. 

• Credit cards
• Investing apps
• Retirement savings
• Cryptocurrency
• The stock market
• Retail investing

• Main content

More From Forbes

Digital esg strategies: the future of corporate sustainability.

• Share to Facebook
• Share to Twitter
• Share to Linkedin

Mr. Giang Tran currently serves as Chief Executive Officer of FPT Digital - a consulting firm of FPT Corporation.

Over the past several decades, digital transformation has evolved from a novel concept to a universal practice, fundamentally altering every aspect of business operations. Its adoption has become essential for companies striving to maintain a competitive edge in today’s market.

Concurrently, the emergence of environmental, social and governance (ESG) trends has garnered significant attention, transcending from mere corporate responsibility to a key component of business strategy. As businesses navigate between technological advancement and societal imperatives, the synergy between digital transformation and ESG principles emerges as a promising alliance toward sustainability.

This raises the question: Is it necessary for ESG initiatives to be accompanied by digital transformation, and how do digital technologies enhance ESG performance?

Environmental

To evaluate the potential effectiveness of this synergy, let’s begin with the environmental aspect of ESG . This component focuses on minimizing the ecological footprint of businesses. Nowadays, companies are increasingly aware of the need to reduce their consumption of natural resources and emissions. This involves optimizing the use of water, energy and raw materials to ensure sustainable operations.

Today’s NYT Mini Crossword Clues And Answers For Wednesday, July 24

J.d. vance biopic ‘hillbilly elegy’ becomes netflix global top 10 hit, the good, bad and ugly from day 2 of packers’ training camp.

By leveraging advanced technologies such as IoT, AI and big data analytics, companies can streamline operations, reduce waste and improve energy efficiency, thereby minimizing environmental impact. In fact, according to a report by my company, FPT Digital, applying digital technologies can help to potentially reduce 20% of greenhouse gas emissions and save a total of $4.9 trillion by 2030 on a global scale.

Other remarkable numbers come from Johnson & Johnson Bangkok with the integration of 4IR technologies like AI for energy optimization and advanced data analytics. This transformative approach has yielded impressive figures across their value chain: a 47% increase in revenue alongside a 25% reduction in inventory.

Moreover, they’ve managed to slash end-to-end supply chain lead times by 43%, boost productivity by 42% and optimize carbon footprint by 20%. These efforts not only mitigate environmental damage but also help companies reduce operational costs and enhance their reputation among environmentally conscious consumers and investors.

The social aspect of ESG emphasizes the importance of equitable treatment and the well-being of employees, communities and other stakeholders. Companies are called upon to promote diversity and inclusion within their workforce, ensuring equal opportunities regardless of gender, race or background.

Digital transformation ensures that technology becomes the great equalizer in the workplace. Regardless of gender or race, employees can access the same digital tools and platforms, fostering an inclusive environment where opportunities are based on merit and performance. Technology can help bridge gaps and dismantle long-standing biases, contributing to a more equitable workplace.

Moreover, digital transformation can significantly boost quality of life by enabling flexible work arrangements, improving healthcare through telemedicine and enhancing education through e-learning platforms. The beneficial effects of digital technologies are evident in statistics from WifiTalents, which show that technology can increase employees' productivity by up to 25% .

Additionally, 83% of workers indicated that having the capability to work remotely with the aid of digital tools would increase their happiness. By fostering a fair and supportive work environment, businesses can boost employee satisfaction and productivity and help attract and retain talent.

The last component of ESG involves governance, a part that is widely considered as the backbone of a sustainable business. It involves establishing robust, transparent management practices that ensure accountability and fairness in all corporate dealings.

From a management perspective, digital tools provide clearer, data-driven insights that facilitate informed decision-making and strategic planning. Enhanced transparency and accountability within organizational processes lead to more fair and effective governance structures.

According to research by Oracle , over 90% of business leaders believe that the right data and insights can help them make better decisions, and 79% of people also believe that an organization that uses technology to make data-driven decisions will be more successful.

In addition, digital transformation opens new revenue streams by creating innovative business models and services. For instance, companies can capitalize on digital platforms for e-commerce, subscription services or digital twins, expanding their market reach and enhancing profitability.

The integration of digital transformation and ESG initiatives is not just beneficial but increasingly imperative for businesses seeking to thrive in today’s socially conscious market. This synergistic approach not only drives sustainability but also cultivates resilience, innovation and long-term value creation for all stakeholders involved.

Forbes Technology Council is an invitation-only community for world-class CIOs, CTOs and technology executives. Do I qualify?

• Editorial Standards
• Reprints & Permissions

KPMG Personalization

• Global ESG due diligence+ study 2024

Moving from risk to value creation

• Home ›
• Insights ›

ESG due diligence rising in priority

ESG due diligence remains a priority for dealmakers. In fact, respondents to the latest Global KPMG due diligence study report a rise in ESG priority in transactions over the last 12 to 18 months, despite challenges.

Many global M&A markets have decelerated in the face of higher interest rates. Geopolitical and economic uncertainty has taken its toll, shifting priorities for many businesses. And, in some countries, there is lively public debate about the merits and justifications to include ESG factors in investment decisions.

Despite these headwinds, the findings from our latest survey of more than 600 active dealmakers from 35 geographies confirms the results of the first-ever international study on ESG due diligence. In 2022, we set out to explore ESG sentiments among dealmakers across the Europe, Middle East and Africa (EMA) region. A follow-up study in the US in 2023 found similar developments, albeit slight less pronounced than in the EMEA region. 

ESG in deal is rapidly maturing. The ESG lens is becoming increasingly important to investors and customers. The difficulty lies in the breadth of the topic, making it critical to know how to look at it in a focused manner. That’s why we focus on value not values. Craig Mennie Global Head of Transaction Services KPMG Australia

Global insights at a glance.

ESG due diligence continues to rise in importance, despite headwinds. Dealmakers report an increased importance of ESG due diligence over the past 12 to 18 months, and expect further increases soon. This counters initial expectations of a decline in the importance of ESG factors due to softer M&A activity, economic uncertainty and an ESG backlash in some countries.

Leading investors tie ESG to the investment thesis and drive financial value from it. They do this by combining a deep understanding of the commercial, operational, and financial risks and opportunities triggered by evolving ESG regulations and stakeholder expectations with a disciplined focus on financial returns during the holding period. They use tools like comprehensive baselining, integrated 100- day action plans, and a systemic scan for sources of financing to improve their investee’s performance. Such performance improvements can materialize in the form of increasing revenues, decreasing costs, or de-risking of an investment, across various environmental and social and governance areas — at this moment, typically in connection with themes such as decarbonization, recycling and circularity and supply chain management.

Challenges in conducting ESG due diligence persist, but solutions are emerging. Investors struggle with selecting a meaningful, yet actionable scope with receiving quality data from target companies, and with quantifying potential findings. However, for each of these challenges, there are emerging solutions. On scoping, it is becoming increasingly clear which topics should indeed be part of an ESG due diligence workstream, with the focus moving from values to value. On data quality, we see a great opportunity for sellers and sell-side advisors to drive value from divestments by commissioning higher-quality ESG vendor documentation. And on quantification, the synergies between ESG due diligence teams and commercial and operational due diligence teams are becoming clearer.

Key findings

It is becoming increasingly clear that considering ESG on transactions primarily means understanding the commercial implications that could have a significant deal value impact. Florian Bornhauser Director, Deal Advisory, Co-Head of Strategy Group in Switzerland KPMG Switzerland

Global ESG due diligence study 2024

Learn how leading investors are leveraging evolving ESG regulations and shifting stakeholder behaviors with a disciplined focus on financial returns.

Considering ESG in investment decisions has become non-negotiable for many investors. The extent and depth to which ESG-related risks and opportunities are being considered has increased significantly over the past 12 months, and leading investors are driving value from it. Julie Vasadi Partner, Head of ESG Transaction Services, Deal Advisory KPMG Australia

Interactive dashboard of 2024 findings

Interactive dashboard

Discover the data that drives the world of ESG due diligence with our interactive dashboard. Designed to offer a more personalized view of the data points detailed in our report, this tool allows you to delve deeper into the survey results. With the ability to filter data by region, company type, and sectors, you can gain additional perspectives and insights that go beyond the report.

This dashboard is a companion to the Global ESG due diligence study and when used together, they provide a comprehensive understanding of the findings.  Download the report and explore the dashboard today. Unlock the power of data to drive your ESG due diligence decision-making process.

ESG due diligence around the globe

 Click on the country or region below for the unique point of view in each market. 

ESG due diligence in Australia

In australia, decarbonization, climate risk – both physical and transition – dominate the esg conversation. with no required esg regulations in place just yet, companies keenly aware of the financial implications of esg are voluntarily reporting on their esg practices and disclosing standards. investors, too, are increasingly aware of the importance of identifying climate risks and mitigating climate exposures. modern slavery, human rights and labor practices are also growing focus areas as dealmakers look to better assess potential reputational risks associated with non-compliance. yet, it is the opportunities for value creation that has captured the imagination of mature dealmakers. reinforced by intensifying progressive sentiments, dealmakers are assessing potential targets with a lens on how well they can navigate the transition to a low-carbon economy. those with such potential, can innovate using australia’s natural advantages, its abundant sunshine, for example, to enhance competitiveness in the renewable energy sector, and access new revenue streams and markets. products with strong esg credentials can also command premium prices. seeking value, not values the appetite for esg due diligence is rising, yet the breadth and complexity of the topics within the esg umbrella is challenging. unlike financial due diligence, which has a well-defined scope, esg due diligence encompasses a wide range of issues that can make it difficult for investors to know which issues to prioritize and manage. adding to this is the lack of prescriptive regulations, like those in the eu, that are making it tough for businesses to navigate socially sensitive situations. dealmakers also struggle with the practical aspects of integrating esg considerations into their dealmaking. this includes defining and measuring the financial impact of esg performance. as finding the right advisors who can offer a holistic approach that encompasses environmental, social and governance factors with sector knowledge and an investor acumen. kpmg professionals help clients focus on value, not values. driven by the financial value that esg due diligence can bring to an investment, teams bring their extensive experience and global methodologies to quickly and efficiently define a scope of work that targets value creation, which is translated into financial language. as the country prepares to implement new esg-related reporting frameworks, starting with climate disclosures in 2025, esg due diligence awareness and adoption is expected to grow across all market segments. visit our website if you want to know more about esg due diligence in australia www.kpmg.au, esg due diligence in canada, canada continues to strengthen its understanding and implementation of corporate esg risk mitigation . in the early days of the responsible investing movement, the country’s larger public pension funds were among the first to recognize the impact esg could have on enhancing revenue, reducing costs and mitigating risks. many of canada’s banks , corporations and investors quickly followed suit, voluntarily aligning with international sustainability standards like the principles for responsible investment (pri) and the task force on climate-related financial disclosures (tcfd). as mandatory measures begin to emerge, including reporting on climate risk management for banks, the fight against forced and child labor in supply chains across all sectors, and federal and provincial carbon pricing mechanisms, the country will see even more transparency across esg considerations. this proactive approach is leading many investors and businesses to view esg due diligence as an effective tool for identifying opportunities for value creation rather than solely as a way to mitigate risks. opportunities abound in esg the energy transition, for example, offers ample investment opportunities in renewable energy, electric vehicles and battery storage. government incentives at various levels further support these initiatives, offering financial benefits for energy efficiency and retraining programs. on the risk side, the country’s exposure to wildfires and extreme heat events call for robust climate risk management strategies, especially for the transportation and logistics , mining and industrial manufacturing sectors. despite this support for esg due diligence, investors are challenged by the limited access to reliable data, especially when targets may not provide comprehensive information. canada’s diverse investment portfolio spans various global markets, making it difficult to maintain consistent and comparable esg information. in particular, smaller investors struggle with limited resources and expertise compared to larger funds. to help navigate these challenges, kpmg in canada uses its subject matter expertise in various sectors and sustainability issues to provide clients with insights and practical tools. the firm’s global reach and access to a diverse client base support clients with leading trends and practices to help dealmakers connect esg findings to revenue growth, cost management and asset valuation. looking ahead, climate change is expected to demand increased attention in terms of physical and transition risks. the social aspects of esg, including talent attraction and retention, is also gaining prominence. sustainability will increasingly influence valuations – all of which will likely make esg due diligence an essential part of investment decision-making. as esg in canada evolves from a voluntary, business-led initiative to a more structured practice, investors will need to stay agile and seek the professional guidance they’ll need to help turn esg challenges into opportunities for sustainable growth and long-term value creation. visit our website if you want to know more about esg due diligence in canada www.kpmg.ca, esg due diligence in china, over the past two decades, esg due diligence has undergone a significant evolution in china. initially, esg disclosures were influenced by foreign investors – global private equity funds investing in china as well as chinese investors participating in outbound opportunities. today, voluntary esg reporting is growing across the country. china’s ambitious carbon targets has supported this uptake. esg standards have been embedded into broader compliance frameworks, such as energy efficiency review, air emissions, water discharge and industrial zoning. these regulations promote sustainable development and meet global standards. for the most part they heavily emphasize environmental concerns, and as such, predominately affect high-risk sectors, such as manufacturing and energy. with the potential to incur operational risks, loss of investor confidence as well as financial penalties, investors have come to see esg due diligence as a compliance exercise. broadening the scope of esg due diligence as more and more investors and companies recognize the value of esg, this perception is starting to change. investors and consumers are calling for private equity businesses to prioritize environmental and social responsibilities. government regulations are following suit. guidelines are being developed to promote corporate social responsibilities, and environmental regulations are expanding to more industries. geopolitical uncertainties are becoming more complex, requiring investors to carefully consider these factors in their investment decisions. there are also opportunities for local and global investors: aligning to best practices boosts a company’s public image at home and enhances its appeal globally. the latter point is of particular interest for those investing in emerging sectors, including renewable energy and electric vehicles. all together, these factors are helping corporate and private equity investors broaden their scope of esg. as more and more investors perform esg due diligence and use its findings as a strategic tool to create value, they will likely call on businesses to collect reliable esg data to better assess esg performance – such data is currently lacking. investors should also look to their advisors for such strategic insights, in addition to providing in-depth analysis of regulatory compliance. in time, it is anticipated this experience will help investors in china embrace esg as a core aspect of their business strategy. visit our website if you want to know more about esg due diligence in china www.kpmg.cn, esg due diligence in finland, the trend in finland is clear: corporate and private equity investors recognize esg as a value driver to enhance portfolio performance. esg due diligence is gaining traction, too, appearing in about 20 percent of all deals. this movement is greatly influenced by the esg regulation landscape in the eu. like other eu countries, finland adheres to the corporate sustainability reporting directive and directives in place in the eu. this proactive approach goes further. mature investors, particularly private equity houses, have integrated esg considerations deeply into their strategies and operations. portfolio managers, for example, have developed internal capabilities and tools to scout targets that are innovating sustainable solutions, such as smart grid technology, or using circular economy practices to minimize waste and maximize resources. from an early stage of the deal, they assess esg factors to guide investment decisions and help ensure that potential acquisitions align to their sustainability goals. additionally, they leverage esg performance to attract capital, structuring financial arrangements where esg key performance indicators, such as diversity and climate targets, can influence capital costs. finland’s institutional investors, including pension funds and insurance companies, are highly sophisticated with comprehensive responsible investment policies. using esg strategies, including exclusionary screening, thematic investing, active engagement and esg integration, they can better position their investments to generate financial returns while positively contributing to social and environmental outcomes. investors with less sophisticated practices also increasingly recognize the potential for value creation from strong esg performance. yet, there are challenges holding them back from capturing these opportunities through esg due diligence. with a focus on the immediate risks, some investors struggle to recognize long-term value. further, quantifying value of esg factors, such as human rights and diversity in management, requires sector-specific insights and nuanced analysis that goes beyond simple compliance checks. adding to this challenge are budget constraints. this common issue often leave investors depending on other due diligence workstreams to surface esg risks, or limiting the depth of analysis within a specific esg due diligence. as regulations continue to evolve and investor expectations rise, companies should deepen their esg integration. time will also help investors mature around esg assessments. as they do, pooling sector and esg due diligence expertise can position them to become a benchmark for others to follow. visit our website if you want to know more about esg due diligence in finland www.kpmg.fi, esg due diligence in france, investors in france consider esg issues like talent retention, social governance and environmental initiatives as integral to a company’s long-term success. this has led to marked shift in the demand and scope for esg due diligence in the past 10 years. for decades, businesses and investors in france were focused on environmental, health and safety factors related to tangible assets like manufacturing facilities. then with the growing number of french signatories to the un principles of responsible investment since 2012, the scope was expanded to include the fuller esg criteria. this sentiment led to growing demand for esg due diligence. a trend that is helping investors mitigate the environmental, social and governance risks that face many french companies. for example, environmental risks in industries with high environmental footprints or high turnover rates and employee dissatisfaction that can impact business continuity and reputation. on the other hand, esg due diligence is helping mature investors uncover numerous advantages. companies that aligned with decarbonization targets or demonstrate strong ethical supply chain practices often have enhanced reputation capital, which can translate into higher customer loyalty, better employee retention and greater overall market value. sellers, too, win, attracting more investments in their business. despite this growing awareness and appreciation, esg due diligence continues to be seen as a ‘nice to have’ exercise by less mature investors who are unsure which components to assess across the broad scope of esg criteria. these dealmakers often allocate lower budgets to esg due diligence compared to other due diligence streams, making it hard for advisors to provide an effective assessment of the risks and value potential of a deal. in time, as regulatory frameworks evolve and investors become more attuned to the potential business benefits of esg, the demand for esg due diligence will continue to gain momentum. expectations will likely also shift toward more comprehensive and higher-value esg assessments that can open the door to better business outcomes and a more sustainable future. visit our website if you want to know more about esg due diligence in france www.kpmg.fr, esg due diligence in germany, the following is the transcript from an interview with elsa stetinger, kpmg in germany, about the evolution of esg due diligence in germany. at a high level, could you please explain the local regulatory framework that supports esg due diligence in recent years, various regulations have been enacted, such as the eu green deal, eu taxonomy, sfdr, tcfd, tnfd, csrd, csddd, german supply chain act, cbam and the anti-greenwashing directive that was recently in 2024 enforced. these have become much more important, especially in the european union. those regulations are also strongly interlinked and relevant nowadays to conduct and support an esg due diligence because those regulations request (i) transparency (ii) comparability and (iii) reporting. this, along with the identification of risks and opportunities, is the core of an esg due diligence. these regulations are a strong signal from politicians and the countries for the need for sustainable investments and transformation that drive the future market outlook and future transactions including esg due diligences on the buy-side and on the sell-side. what are the key esg risks and opportunities that companies in germany face the key esg risks in germany include: understanding the various regulatory requirements and complying to them. generating and providing qualitative and quantitative data – so data availability and quality. understanding the various scope items or esg topics, and implementing those into an applicable, usable and feasible framework to analyze risks and opportunities. setting concrete goals, and sustainably and sequentially achieve those goals. having the sufficient resources – financially or personally – so qualified employees. at the same time, the various regulations are a great steep template and offer a huge chance for: innovation; return-on investment; talent attraction; new market expansion and growth opportunities; reputational, transitional, and transformational chances; and future-proof the business and contribute to a sustainable future, including environmental protection and social fairness. could you provide some examples of how esg factors have influenced investment decisions and/or deal outcomes there are several environmental topics, such as very high emissions, main energy sources from nuclear power plants or brown coal, and severe soil and groundwater contamination that could impact the outcome of a deal. social topics, such as human rights issues, forced or child labor as well as poor working conditions, including severe accidents and deaths within a company are an absolute deal breaker. and of course, there are various other esg factors, such as water scarcity or poor climate mitigation, and climate adaptation measures that can influence the investment decision and the deal price. what are the common challenges that companies face when implementing esg due diligence in your local market some common challenges include: defining a reasonable and manageable esg scope. generating and providing robust data. identifying relevant risks and opportunities by qualified people within the various environmental, social and governance topics. setting priorities of measure implementation and being able to quantify findings within an esg due diligence analysis. how does your firm help clients navigate esg risks and opportunities at kpmg in germany, we have established a robust and at the same time flexible, esg due diligence framework that assess the esg-performance and status quo of a company or investment. our esg due diligence framework is based on the various regulations (as mentioned before) and combines and integrates the anchored environmental, social and governance requirements. additionally, we include other kpis that are appliable to the industry, sector and business activity. our established robust and flexible esg due diligence framework allows us to reveal the material risks and opportunities based on key element and color-coding system. it creates objectivity, transparency, comparability and implies the relevant building blocks as a great basis for future transformation processes and impacts of a company or investment. what trends or developments do you foresee in next 5-10 years i think esg due diligence (as a stand-alone workstream) will a be involved almost in 100% of all deals. the need is and will become very high for transparency and a real sustainable future – away from greenwashing. i think the esg due diligence scope is constantly expanding, and more building blocks will be integrated in the esg due diligence scope as newer and stricter regulations will become enforced. the expansion will include integrity due diligences, a stronger double and even triple materiality assessments, and of course risks and opportunities. there will be more precise benchmarking with better data quality, and customer and stakeholder analysis. i believe that various companies might not be able to exist on the market in the next five to 10 years if they do not undertake a sustainable transformation. at the same time, i believe that esg high-performing, very innovative and sustainable companies with a smart governance structure with high-qualitative and robust data will conquer the market in the next five to 10 years. visit our website if you want to know more about esg due diligence in germany www.kpmg.de, esg due diligence in iceland, a growing number of investors in iceland are aligning their investments to sustainability objectives. the upward trend comes from the country’s rising commitment to environmental sustainability, global climate action initiatives, and gender equality and other social issues. as a result, esg due diligence is evolving in the country. five years ago, esg considerations were rarely part of a deal’s due diligence process. now, there is a promising evolution in a short period of time where investors are asking esg-related questions during traditional due diligence exercises, such as tax and legal. more mature investors are also leveraging esg due diligence to assess the value creation potentials in a target. in a country ripe for sustainable innovation, investors are looking for businesses that have the potential to advance renewable energy options like geothermal or hydroelectric power. iceland is also well-known for its strong stance on gender equality and other social equities. this social consciousness is having a greater influence on investors as they seek out targets that actively promote equal opportunities and representation across all levels. compliance as a first step with financial bodies calling for updated reporting from companies big and small, the race to implement the new regulations has left many companies scrambling. partly this is due to a cultural tendency to comply with regulations only when enforced. however, good progress has been made. larger companies with their better access to systems and expertise have been more efficiently responding to mandates. smaller businesses, which make up the majority of iceland’s economy, have also been working to understand the technical standards and minimum safeguards required to comply, despite their limited access to expert resources. as icelandic companies adapt to these changes, the role of due diligence will become increasingly intertwined with esg factors. a thorough understanding of esg issues will be essential for due diligence teams to assess the fuller spectrum of compliance and sustainability aspects. companies will also need to continue to develop their esg practices to mitigate associated risks and fully capitalize on the sustainability opportunities ahead. visit our website if you want to know more about esg due diligence in iceland www.kpmg.is, esg due diligence in island group, in jurisdictions known for their susceptibility to significant climate risks, esg due diligence is gaining attention. the many islands within the caribbean, together with jersey, guernsey, the isle of man and malta make up the kpmg islands group, where investors and businesses are beginning to recognize the potential of esg to attract global capital and ensure sustainable growth. in the cayman islands and bermuda, the financial services sector shows a growing awareness of esg considerations. in the more traditional industrial and tourism-centric jurisdictions, such as trinidad & tobago and jamaica, there is also a growing understanding for esg and its importance to long-term sustainability and competitiveness. with the potential for substantial financial returns, more mature regional players and impact investors are beginning to integrate esg factors into their investment strategies. progress, however, is slow due to the absence of mandatory regulations as well as global political influence. for now, esg integration relies heavily on voluntary adoption and the foresight of investors and business leaders who are looking to open up new opportunities for growth and development. as governments in the region begin to implement frameworks to support sustainable finance, businesses will likely begin to embed esg principles into their core operations and investors are more likely to incorporate esg due diligence into their decision-making, along with the more traditional financial, commercial, regulatory and tax due diligence. this shift could come faster as governments contend with the realities of climate exposure. hurricanes, rising sea levels and extreme weather events pose significant threats to these islands. the bahamas, for example, is still recovering from hurricane dorian in 2019 and may be at risk of financial default if another hurricane strikes. an eye focused on innovation on the upside, with plenty of sunshine and wind energy (as well as the increasingly talked-about natural resource, sea grass), the caribbean region is teaming with untapped esg potential into renewable energy sources like solar and wind power and the ability to create a carbon credit economy from sea grass, as is being explored in the bahamas. such innovations can be hindered by high costs and legacy agreements, but declining costs of renewable technologies and innovative financial strategies, such as thematic bonds, could unlock substantial growth in this sector. governments and private investors can also come together on large-scale renewable energy projects that could help reduce reliance on imported fossil fuels, but also create sustainable jobs and stimulate economic growth. the kpmg islands group professionals are helping investors understand the long-term value that comes from sustainable practices and unlock the region’s potential for sustainable growth. as more investors take advantage of these opportunities, kpmg professional will help them integrate esg due diligence to identify potential risks and uncover opportunities for value generation. visit our website if you want to know more about esg due diligence in island group https://kpmg.com/ky, esg due diligence in norway, esg is moving up the business agenda in norway . already many businesses and investors comply with esg reporting. this signals the country’s cultural commitment to sustainability and the environment. businesses also feel a sense of national pride and responsibility to uphold norway’s image as a responsible and ethical nation. even more businesses are expected to adhere to reporting in line with eu and national standards and requirements as they begin to roll out, including the corporate sustainability reporting directive (csrd) and the corporate sustainability due diligence directive (cs3d). at the core of norway’s new regulations is the transparency act, requiring companies to identify and assess actual and potential adverse impacts on human rights and decent working conditions in companies and their supply chains, among other requirements. as welcome as these regulations may be, they are creating new challenges for companies. businesses often struggle with understanding the depth of compliance required by new and evolving regulations. lack of reliable data and information adds another layer of difficulty. for example, norway’s energy businesses often have complex, multi-tiered supply chains that deal with suppliers from countries and regions with lower transparency practices and potential human rights violations. without a clear line of sight, companies can be exposed to reputational risks and public disapproval. such risks can extend to investors, putting greater importance on comprehensive esg due diligence developed by esg specialists that stay on top of evolving regulations and understand the geopolitical risk environment within specific sectors. sustainable opportunities encourage evolution as important as it is to mitigate risks associated with these social factors, investors and businesses are looking across the broader scope of esg to identify potential opportunities to create value for their companies. this is most notable in the country’s growing clean tech and renewable energy sectors with decarbonization innovations like electrolyzers for hydrogen production and expanding hydropower and wind energy sources. as these and other technologies evolve, there may be growing focus on the intersection of tech investments and esg considerations. for example, as more businesses leverage ai they may want to consider how to best power their respective data centers with sustainability in mind. such evolutions will also shift and refine the scope of esg due diligence to help investors maintain their sustainable and ethical commitments, while enhancing their portfolio performance. visit our website if you want to know more about esg due diligence in norway www.kpmg.no, esg due diligence in spain, in spain, investors have come to see esg due diligence as an essential part of value creation in transactions. this shift indicates a growing sophistication among corporate and private equity dealmakers, and a recognition of the strategic potential benefits of robust esg credentials. spain’s esg due diligence practices are heavily influenced by the influx of eu regulations over the last several years. these directives compel funds to integrate esg considerations into their operations. this exposes businesses and investors to risks should they neglect to comply to these mandates. for example, in sectors like energy or agriculture, lack of alignment could lead to unforeseen liabilities and reputational damage. regulations aside, evolving consumer demands influenced corporate and private equity investors to practice greater corporate responsibility and transparency also contributed to the shift. as investors began integrating esg factors into their investment decisions, the experience provided proof that prioritizing esg supported long-term financial performance. it also enhanced their reputation and helped build trust with clients, consumers and other stakeholders. esg-focused companies are often less volatile, and demonstrate superior risk management and operational efficiency. they are also more innovative. such innovation could come in terms of how well a target can adapt to future regulatory changes or evolving market conditions. it also offers insights in a company’s potential to branch out to emerging sectors, such as renewable energy, sustainable agriculture or green technology – all of which are poised for substantial growth in spain. for the most part, esg in spain has mainly centered on environmental aspects. addressing issues like climate change and decarbonization impacts a company’s operations, portfolio of products and services, as well as its overall strategic approach. the social and governance aspects of esg are less tangible. yet, mature investors are increasingly recognizing such issues, like human rights and fair labor conditions, can be integral to building resilient companies. quantifying such factors is one of the challenges dealmakers face during the due diligence process. unlike environmental liabilities that can often be translated into financial terms, social and governance issues can be tough to attach to a concreate number. such complex valuations call for esg specialists who can assess the cost of reputational risks on company value. looking ahead, esg due diligence in spain is expected to continue to evolve from a niche practice and become a mainstream necessity. this will be especially important as regulations progress and adjust, and consumer demands shift to new focus areas. visit our website if you want to know more about esg due diligence in spain www.kpmg.es, esg due diligence in u.k., investors in the uk are increasingly focusing on sustainability and esg considerations in their investment process. as a result, esg due diligence has jumped higher up the m&a agenda. the kpmg 2024 global esg due diligence study found 71 percent of respondents reported an increase in importance of esg in transactions over the last 12 to 18 months. there are several drivers underpinning this shift. esg has become an important lever to create value in transactions and dealmakers are seeing higher returns for their investments when there are stronger esg practices and positioning in place. investors are also focused on protecting value. with increased regulations, such as the eu corporate sustainability reporting directive (csrd), and concern for ethical considerations there are potential reputational risks that could come with non-compliance. there has also been a significant increase in impact investing. investors focused on impact seek companies that balance profit with purpose, and are focused on addressing global sustainability challenges, such as the energy transition. for investors, then, failure to embrace esg can leave tangible value on the table. it can also minimize the pool of capital, and potentially prevent a deal from closing. uk investors are turning away from some sectors, such as tobacco, gambling and fossil fuels due to ethical consideration and long-term sustainability concerns. according to the survey, more than 50 percent of surveyed investors indicated that esg was a “deal stopper.” investors are also asking more of target companies. with esg due diligence becoming a strategic, cross-function and commercially focused exercise, investors are looking for greater transparency on their climate-related practices, diversity, equity and inclusion programs, supply chains and more. this is pressuring sellers to enhance esg-related efforts, especially as more dealmakers plan to include esg due diligence in deal strategies going forward. globally, 57 percent of survey respondents say they expect to perform esg due diligence on most of their transactions over the next two years. even with this rise in activity, investors are looking for greater clarity around the areas to evaluate, specifically in fast-moving deal contexts. whereas others are looking to advisors to help quantify less tangible esg factors, such as the impact of reputation risks or long-term environmental impacts on value. kpmg in the uk’s esg transaction advisory services is placed to help, bringing you the experience and insights you need to realize value from esg in your investments. visit our website if you want to know more about esg due diligence in u.k. www.kpmg.uk, esg due diligence in u.s., esg is undergoing a transformative shift in the us. with regulations tightening, the investor community is beginning to recognize the link between sustainable esg practices and sustainable business growth. esg has long been on the agendas of us investors and businesses. federal and state regulations were initially focused on environmental health and safety matters, ensuring businesses had the right permits for sustainable practices like air emissions, wastewater discharge and waste management. many of these requirements are still in place today. states have also introduced esg-related regulations to encompass a wider range of issues, including sustainability, employee well-being and regulatory compliance. more recently, states like california have implemented climate disclosure requirements for businesses. investor influence spurs esg due diligence yet, the biggest push for esg mandates comes from investors themselves. over the past five to eight years, there has been a marked shift in interest around esg from investors. this has been particularly driven by private equity investors who are focused on creating sustainable and long-term value for their businesses. they are funding innovative projects in renewable energy and carbon capture and energy-efficient technologies. they are also turning to their advisors to discuss governance matters, supply chain transparency, product lifecycle and customer satisfaction. growing demands from socially and environmentally conscious consumers are further pressuring us companies to integrate esg considerations into their business strategy and operations. however, reporting these practices to investors during esg due diligence is proving challenging. one major issue is the collection and management of relevant data, particularly for greenhouse gas inventories. many companies can track their direct emissions, capturing indirect emissions from supply chains is complex and resource intensive. governance is another area of concern. not all companies have access to robust mechanisms to report regulatory reporting and materiality assessments, or reliable data on social matters related to business ethics, labor practices or supply chain integrity. despite these initial challenges, investors and businesses are starting to realize the financial and operational benefits of more sustainable and ethically responsible practices and investments. looking ahead, emerging regulations and increasing stakeholder demands is expected to continue to shape the esg landscape in the us. as this happens, investors will need to stay agile and seek expert guidance to unlock new growth opportunities. visit our website if you want to know more about esg due diligence in u.s. www.kpmg.us.

KPMG member firms are at the nexus of the intersection between M&A and ESG. Through their daily work, KPMG professionals are at the forefront of the developments taking place in this rapidly evolving field. They are working with many of the leading corporate and financial investors to identify and develop ESG-related deal strategies and processes that meet their unique needs and objectives. Select your country or region below to connect with a local ESG practitioner.

Julie Vasadi

Head of ESG Due Diligence, Transaction Services KPMG Australia

Seymur Niftaliyev

Director, Head of KPMG Law KPMG in Azerbaijan

Katharina Schönauer

Senior Manager, Advisory KPMG in Austria

Stijn Potargent

Partner, Deals | Advisory KPMG in Belgium

Arnaud van Dijk

Partner, ESG KPMG in the Cayman Islands

Niclas Buch Mahler

Associate Director, Deal Advisory KPMG in Denmark

Alexey Abramov

Partner, Head of KPMG Law, KPMG in the Caspian

Partner, ESG Advisory / ESG Data & Technology Lead KPMG in China

Partner, Deal advisory KPMG China

Jaba Gvelebiani

Head of KPMG Law KPMG in Georgia

Tomas Otterström

Global Leader, Sustainable Finance Services KPMG in Finland

Nicolas Cottis

Director, Responsible Investment, Transaction Services KPMG in France

Frank Hengelbrock

Partner, Advisory, Head of ESG Due Diligence in Deals KPMG in Germany

Director KPMG in Hungary

Head of Transaction Services, Deal Advisory KPMG in Indonesia

Shivananda Shetty

Partner, Practice Lead- ESG KPMG in India

Shane O'Reilly

Director, KPMG Sustainable Futures KPMG in Ireland

Stefano Giacomelli

Associate Partner KPMG in Italy

Fadi Al Shihabi

ESG Services Leader KPMG Lower Gulf

Kyohei Yoshino

Partner, Deal advisory KPMG in Japan

Sheen, Sue-Ryearn Jessica

Director, Deal advisory, KPMG Korea KPMG in Korea

Elaine Cheah

Partner–Head of Deal Advisory & Transaction Services KPMG in Malaysia

Jeiran Ebrahimi

Director Transaction Services KPMG in the Netherlands

Krzysztof Pietrzyk

Director, Deal Advisory KPMG in Poland

Marc Leubner

Associate Partner KPMG in Slovakia

Ramón Pueyo

Director, Governance, Risk and Compliance KPMG in Spain

Tomas Grendal

Head of Deal Strategy KPMG in Sweden

Florian Bornhauser

Director, Global Strategy Group, Deal Advisory KPMG in Switzerland

Vincent Chang

Deputy Head of Advisory, Head of Private Equity KPMG in Taiwan

Songon Kiatlertpongsa

Partner, Deal Advisory KPMG in Thailand

James Holley

Partner, ESG Transaction Services KPMG in the UK

Jakob Schenker

Director, Sustainability and Climate Advisory KPMG in the US

Clark Savolaine

Partner, Deal Advisory, Global Infrastructure Advisory KPMG in Canada

Review our latest insights

Taking a strategic approach towards corporate governance, board-level responsibility and reporting

Anchoring ESG in governance

How leading M&A teams are managing ESG DD

Leveraging ESG due diligence to unlock value

Examining steps taken by 24 countries as well as key economic sectors to reduce the greenhouse gas emissions that cause climate change.

Examining the progress of 24 countries as well as key economic sectors

Assessing the risks and opportunities of digital assets and data

Sustainable deal value comes from a deeper, more expansive look at a deal’s risks and value opportunities

Helping dealmakers create sustainable value

How KPMG can help

KPMG’s integrated team of specialists works at deal speed to help you find and drive value throughout your transformation and transaction lifecycle.

An integrated team of specialists working at deal speed to help you find and drive value.

Helping you realize desired results with a deliberate, forward-thinking approach to deal planning, execution and integration.

Helping you realize desired results with a deliberate, forward-thinking approach to...

Unlock the power of ESG to transform your business and build a more sustainable future.

KPMG. Make the Difference.

KPMG firms’ global ESG due diligence methodology

Since the launch of the landmark KPMG ESG due diligence study in the EMEA region in 2022, the state of adoption and prevailing challenges faced by investors have been clear.  In response, KPMG ESG due diligence solution leaders worldwide have developed a market-leading, client-informed ESG due diligence methodology that quantifies ESG risks and value creation opportunities, calibrating them against investment materiality. It combines the experiences of the leading practitioners across the global KPMG organization, making them accessible and consistent to our teams globally.  The KPMG methodology leverages internationally recognized ESG standards and frameworks, as well as industry specific regulations. It is scalable, enabling tailored scoping for respective targets and sectors, and covers a wide array of ESG topics with input from various subject matter specialists across the global KPMG organization. The methodology is also  tech-enabled, drawing on vast public and proprietary ESG benchmarks and data sources globally. Importantly, ESG due diligence findings are calibrated with financial materiality and value drivers, articulated in terms of their strategic business and deal implications.

Working together, we can reimagine medicine to improve and extend people’s lives.

Associate Director, ESG Disclosures & Ratings (80-100%*)

About the role.

Key Responsibilities:

MATERIALITY ASSESSMENT

• Monitor Disclosure Requirements: Collect and maintain an overview of disclosure requirements across various standards and ESG ratings, ensuring alignment with regulations.
• Double Materiality: Continuously refine our double materiality assessment (DMA) methodology to ensure compliance with the EU’s Corporate Sustainability Reporting Directive (CSRD) and regularly execute and refresh our DMA.
• Impacts, Risks and Opportunities (IROs): Establish and maintain a repository of ESG impacts, risks, and opportunities (IROs) in collaboration with relevant business functions.

RISK MANAGEMENT INTEGRATION

• Integration with Enterprise Risk Management (ERM) : Incorporate ESG risk identification and assessment processes into the overall ERM framework.
• Quantification of IROs : Enhance the quantification of IROs using scenario analysis and measurement of material ESG factors.
• Value chain mapping: Establish consistent mapping for our value chain to support the assessment of impacts, risks, and opportunities in our own operations, upstream and downstream value chain.

INSIGHTS GENERATION

• Insights Sharing: Establish a system for sharing insights to support the development of the overarching ESG strategy.
• Monitor ESG developments: Keep abreast of developments in ESG standards and best practices related to risk management, materiality assessment, and related general disclosures under the CSRD.
• Strengthen disclosure links: Strengthen the connection between material disclosure requirements and our business model and strategy.

Essential Requirements:

• Degree in Business, Finance, Law or Life Sciences or equivalent on-the-job experience

• Strong project management skills and the ability to transfer analytical insights into action

• Strong communicator, able to develop presentations for senior leaders and to present clearly and effectively

• Good understanding of trends and developments in the area of sustainability and ESG and significant previous exposure to ESG ratings, and Sustainability/ESG reporting

• Proactive self-starter, able to operate independently, strong attention to detail

• Proficiency in English (written and spoken)

Why Novartis?

Our purpose is to reimagine medicine to improve and extend people’s lives and our vision is to become the most valued and trusted medicines company in the world. How can we achieve this? With our people. It is our associates that drive us each day to reach our ambitions. Be a part of this mission and join us! Learn more here: https://www.novartis.com/about/strategy/people-and-culture

*Some restrictions on flexible working options may apply and will be discussed during interview if applicable

You’ll receive:

You can find everything you need to know about our benefits and rewards in the Novartis Life Handbook. Thrive Together (novartis.com)

Commitment to Diversity & Inclusion:

Novartis is committed to building an outstanding, inclusive work environment and diverse teams representative of the patients and communities we serve.

Accessibility and accommodation

Novartis is committed to working with and providing reasonable accommodation to all individuals. If, because of a medical condition or disability, you need a reasonable accommodation for any part of the recruitment process, or in order to receive more detailed information about the essential functions of a position, please send an e-mail to diversity.inclusion_ch@novartis.com and let us know the nature of your request and your contact information. Please include the job requisition number in your message.

Join our Novartis Network:

If this role is not suitable to your experience or career goals but you wish to stay connected to hear more about Novartis and our career opportunities, join the Novartis Network here: https://talentnetwork.novartis.com/network

Why Novartis: Helping people with disease and their families takes more than innovative science. It takes a community of smart, passionate people like you. Collaborating, supporting and inspiring each other. Combining to achieve breakthroughs that change patients’ lives. Ready to create a brighter future together? https://www.novartis.com/about/strategy/people-and-culture

Join our Novartis Network: Not the right Novartis role for you? Sign up to our talent community to stay connected and learn about suitable career opportunities as soon as they come up: https://talentnetwork.novartis.com/network

Novartis is committed to building an outstanding, inclusive work environment and diverse teams' representative of the patients and communities we serve.

Advertisement

Supported by

What We Know About the Global Microsoft Outage

Airlines to banks to retailers were affected in many countries. Businesses are struggling to recover.

• Share full article

By Eshe Nelson and Danielle Kaye

Eshe Nelson reported from London and Danielle Kaye from New York.

Across the world, critical businesses and services including airlines, hospitals, train networks and TV stations, were disrupted on Friday by a global tech outage affecting Microsoft users.

In many countries, flights were grounded, workers could not get access to their systems and, in some cases, customers could not make card payments in stores. While some of the problems were resolved within hours, many businesses, websites and airlines continued to struggle to recover.

What happened?

A series of outages rippled across the globe as information displays, login systems and broadcasting networks went dark.

The problem affecting the majority of services was caused by a flawed update by CrowdStrike , an American cybersecurity firm, whose systems are intended to protect users from hackers. Microsoft said on Friday that it was aware of an issue affecting machines running “CrowdStrike Falcon.”

But Microsoft had also said there was an earlier outage affecting U.S. users of Azure, its cloud service system. Some users may have been affected by both. Even as CrowdStrike sent out a fix, some systems were still affected by midday in the United States as businesses needed to make manual updates to their systems to resolve the issue.

George Kurtz, the president and chief executive of CrowdStrike, said on Friday morning that it could take some time for some systems to recover.

How a Software Update Crashed Computers Around the World

Here’s a visual explanation for how a faulty software update crippled machines.

How the airline cancellations rippled around the world (and across time zones)

Share of canceled flights at 25 airports on Friday

50% of flights

Ai r po r t

Bengalu r u K empeg o wda

Dhaka Shahjalal

Minneapolis-Saint P aul

Stuttga r t

Melbou r ne

Be r lin B r anden b urg

London City

Amsterdam Schiphol

Chicago O'Hare

Raleigh−Durham

B r adl e y

Cha r lotte

Reagan National

Philadelphia

1:20 a.m. ET

We are having trouble retrieving the article content.

Please enable JavaScript in your browser settings.

Thank you for your patience while we verify access. If you are in Reader mode please exit and  log into  your Times account, or  subscribe  for all of The Times.

Thank you for your patience while we verify access.

Already a subscriber?  Log in .

Want all of The Times?  Subscribe .