What are the three main ESG criteria

ESG by definition means environmental, social and governance criteria. These different criteria make it possible to evaluate the societal contribution of a company towards its customers, employees and partners. It also allows us to analyze the financial performance of a company. Let's take a look at the three ESG criteria

Environmental criteria

Environmental criteria are very important. They measure the direct or indirect effects of an organization's or company's activities on the environment through greenhouse gas (GHG) emissions, in particular CO2, energy consumption (electricity) and waste recycling. Find more information on this article. Biodiversity preservation and risk mitigation are objectives of this criterion. For this objective to be achieved, companies and their managers must become aware of the importance of this criterion.

Social criteria

These criteria also refer to the direct or indirect effects of an organization's operations on stakeholders such as employees, customers, suppliers, unions and even the local community in relation to certain universal values. These values are mainly based on human rights and international labor standards. These include, for example, the quality of social dialogue within companies, the ratio of men to women, the employment of disabled people or people from underrepresented groups, access to employee training, accident prevention, and respect for employees' rights. Not only that this criterion fights for equality, but also ethical and moral values.

Governance criteria

These are often the least known to individuals. They relate to the direction, management and control of the company, the feminization and independence of the board of directors and its management. It also forces itself for the transparency of the remuneration of the executives and the fight against corruption, the management structure and the presence of an accounting committee. These three criteria aim to improve the living conditions of employees as well as the preservation of biodiversity.

 These are the three main environmental, social and governance criteria