Environmental, social, and governance (ESG)

Definition

Environmental, Social, and Governance (ESG) criteria are standards for a company's operations that socially conscious investors use to screen potential investments. ESG factors include how a corporation responds to climate change, how it manages relationships with employees, suppliers, customers, and the communities where it operates, and the leadership standards it upholds.

Related terms

Sustainable Investing: Investment in companies that consider environmental, social, and corporate governance criteria to generate long-term competitive financial returns and positive societal impact.

Corporate Social Responsibility (CSR): A business model in which companies integrate social and environmental concerns in their operations and interactions with stakeholders.

Green Bonds: Bonds specifically earmarked to be used for climate and environmental projects