ESG Frequently Asked Questions

Today, transparency and accountability of companies are increasingly questioned topics. Actions taken in the environmental sphere and socially become more noticeable for customers. The topic of this article by Green Academy will be frequently asked questions about ESG and their answers. The responses to this topic, which investors, regulators, NGOs, customers, and other stakeholders are paying more attention to than ever, will serve as a guide for you.

What is ESG?

ESG refers to the examination of a company's environmental, social, and governance practices, their impacts, and actions taken based on these evaluations. This analysis, referred to as ESG, contains the initials of the English words "environmental, social, governance".

Why is ESG important for companies?

ESG is important for various reasons, from responding to investor pressure and managing financial risks to reducing costs and waste and improving public relations. Every company deals with ESG issues, and neglecting them can significantly increase the risk of negative events or controversies.

What are the advantages of an ESG strategy?

By implementing an ESG strategy, companies and stakeholders can benefit from a range of valuable advantages, including improving investor and public relations, managing risk, reducing costs, and enhancing financial performance.

How can an ESG program reduce costs?

Effective ESG programs can reduce operating expenses in various ways. For example, sustainable practices can significantly reduce energy and water usage and limit packaging costs and the amount of waste generated by your company.

Can an ESG strategy improve financial performance?

There is increasing research indicating that ESG practices can lead to better financial performance and increased shareholder value.

Does a high ESG score increase profitability?

While a high ESG score may not immediately increase a company's profitability, not having such a score can lead to the company being unprepared for global conditions in the foreseeable future.

How does ESG risk management affect?

Since ESG practices are risk management practices, they also affect risk management. For example, companies implementing effective ESG programs may be less exposed to supply chain disruptions and other ESG controversies.

How is ESG scoring done?

Companies focusing on ESG can learn their score by working with specialized scoring service companies.

By identifying their deficiencies in ESG and raising their score after making the necessary corrections, they can reap the benefits mentioned above for their own company.

To get more detailed information about ESG and benefit from this service, you can visit the GreenCarbon ESG Consultancy page.