Sustainability issues in the environment dimension impact a company either through the use of nonrenewable, natural resources as inputs to production, or through harmful releases into the environment. The environment aspect of ESG covers the below critical areas

– Climate change and carbon emissions

– Air and water pollution

– Biodiversity

– Deforestation

– Energy efficiency

– Waste and Hazardous material management

– Water and Wastewater management

– Ecological impacts

The social aspect relates to the expectation that the business will contribute to soceity in return for building long standing relationship with all stakeholders such as the public, customers, local communities and governments.

The social dimension of ESG covers the below critical areas

– Human rights and Community relations

– Customer privacy

– Dat security

– Access and Affordability

– Product quality and Safety

– Customer Welfare

– Selling practices

– Product labeling

Human capital defines human resources as key assets to delivering long-term value. A company’s human capital performance depends on the productivity of employees, the management of labor relations, and the health and safety of employees. Good human capital management fosters workforce well-being and generates positive workplace culture. It can enhance personal development and social inclusion in the service of productivity and competitive employment. Poor human capital management, on the other hand, can reduce productivity, increase risk, and harm customer relationships. 

Key information pertaining to the human capital are:

• Labor practices

• Employee health & safety

• Employee engagement

• Diversity & Inclusion

The Business Model & Innovation dimension explicitly addresses the integration of environmental, human, and social issues in a company’s value-creation process. This includes topics related to process innovation, such as resource recovery, and product innovation, including efficiency and responsibility in the design, use phase, and disposal of products. The information captured in this dimension include:

• Product design & lifecycle management

• Business model resilience

• Supply chain management

• Material sourcing & efficiency

• Physical impacts of climate change

Governance involves the management of issues that are inherent to a company’s business model or that constitute common practice in the industry and that are in potential conflict with the interest of broader stakeholders and therefore may create liabilities or hinder license to operate. The leadership & governance aspect of ESG covers

– Business ethics

– Competitive behavior

– Management of legal and regulatory environment

– Critical incident risk management

– Systemic risk management