ESG

Environmental, social, and governance (ESG) criteria are a set of standards for a company’s behaviour used by socially conscious investors to screen potential investments. Environmental criteria consider how a company safeguards the environment, including corporate policies addressing climate change, for example. Social criteria examine how it manages relationships with employees, suppliers, customers, and the communities where it operates. Governance deals with a company’s leadership, executive pay, audits, internal controls and shareholder rights.

REPORTING STANDARDS USED WORLD WIDE:

1. Global Reporting Initiative (GRI) Standards,
2. Task Force on Climate-related Financial Disclosures (TCFD)
3. SASB Standards

Types of Environmental, Social and Governance (ESG) Criteria 

ESG investors seek to ensure the companies they fund are responsible stewards of the environment, good corporate citizens and are led by accountable managers.

Environmental 

Environmental criteria may include corporate climate policies, energy use, waste, pollution, natural resource conservation, and treatment of animals. The criteria can also help evaluate any environmental risks a company might face and how the company is managing those risks.

Considerations may include direct and indirect greenhouse gas emissions, management of toxic waste, and compliance with environmental regulations.

Social 

Social criteria look at the company’s relationships with stakeholders.

Does it hold suppliers to its own ESG standards? Does the company donate a percentage of its profits to the local community or encourage employees to perform volunteer work there?

Do workplace conditions reflect high regard for employees’ health and safety? Or does the company take unethical advantage of its customers?

Governance 

ESG governance standards ensure a company uses accurate and transparent accounting methods, pursues integrity and diversity in selecting its leadership, and is accountable to shareholders.5

ESG investors may require assurances that companies avoid conflicts of interest in their choice of board members and senior executives, don’t use political contributions to obtain preferential treatment, or engage in illegal conduct.

Special Considerations

Investment firms following ESG criteria often set their own priorities.

The criteria are set by analysts who identify the relevant issues facing specific sectors, industries, and companies. Trillium’s ESG criteria preclude investments in the following:

• Companies that operate in higher-risk areas or have exposure to coal or hard rock mining, nuclear or coal power, private prisons, agricultural biotechnology, tobacco, tar sands, or weapons and firearms.
• Companies involved in major or recent controversies over human rights, animal welfare, environmental concerns, governance issues, or product safety.

TECHNOCRAT CONSULTANTS Consulting Offerings:

1. Training on ESG Standards.
2. Assistance for company to publish ESG report as per GRI / BRSR standards.
3. Consulting support to meet various criteria of ESG reporting.