What is ESG?

By Staff writer
May 10, 2023
Environmental, social and governance criteria, or ESG, is a framework used by companies to assess their sustainability by evaluating environmental, social, and governance factors. Environmental criteria pertain to the preservation of the natural world, while social criteria examine a company's treatment of people both inside and outside the organization. Governance criteria consider how a company is managed.
Illustration of the letters ESG and their meaning
The ESG categories cover a variety of aspects, including carbon emissions, air and water pollution, deforestation, green energy initiatives, waste management, employee gender and diversity, data security, customer satisfaction, sexual harassment policies, human rights, board member diversity, political contributions, executive pay, large-scale lawsuits, internal corruption, and lobbying.
Illustration of the 17 UN SDGs in a circle
ESG investment has gained significant importance in recent times, with a growing focus on the Sustainable Development Goals (SDGs) both in Japan and globally. The SDGs are a set of 17 goals that cover a range of global issues relating to the economy, society, and environment. Adopted by all United Nations Member States in 2015 as part of the 2030 Agenda for Sustainable Development, they represent a shared blueprint for achieving peace and prosperity for both people and the planet.

Given this urgent call to action by all countries, ESG investment is increasingly being recognized as an effective means to address these critical issues.
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