ESG brings together environmental, social and governance issues under one banner to ensure that a company's overall impact is positive. ESG is much like corporate social responsibility, but on a vastly larger and more measurable scale. It represents a set of priorities that are most important to investors and consumers at the present time, and having such a policy is beneficial for a company wishing to take action on these issues and to be seen to do so. ESG policies are often used as a framework for organisations to assess and manage their sustainability and responsible business practices, and to communicate their efforts to stakeholders. Organisations may choose to adopt ESG policies for a variety of reasons, including ethical considerations, risk management, reputation management, and alignment with stakeholder expectations.

Examples of ESG criteria:

• Environmental: includes factors such as a company's carbon footprint, water and energy usage, waste management, and pollution levels.

• Social: includes a company's labour practices, human rights record, diversity and inclusion policies, and impact on local communities.

• Governance: includes factors such as a company's board diversity, executive compensation, transparency, and ethical business practices.

What are the benefits of an ESG Policy?

• Demonstrates a company’s commitment to responsible and sustainable business practices, and to manage risks and create long-term value.

• An ESG policy can help companies identify and mitigate risks related to environmental impact, social issues, and governance practices.

• It can drive innovation by encouraging companies to develop new products and services that prioritise sustainability and social responsibility, leading to new market opportunities and increased competitiveness.

• It can help companies align with their stakeholders’ values, including customers, employees, investors, and communities, leading to increased loyalty, engagement, and support.

• It can contribute to long-term growth by promoting sustainable business practices which increase efficiency, reduce costs and generate new revenue streams.

Use this ESG Policy if:

• You are a company looking to improve your sustainability practices and reduce your environmental footprint.

What does the ESG Policy cover?

• The parties responsible for implementing this policy, and the role that they play.

• Monitoring, reporting and enforcement mechanisms.

• The details of initiatives that can be taken.

• Reputational issues.

• Ethical procurement.

Further information

• How to Engage in Socially Responsible Investing