Why does ESG matter?

Companies benefit from ESG for a variety of reasons. Customers demand to know the impact companies are having on the world. Employees prefer to work for organizations that share their ethical values, therefore they want businesses to improve in terms of governance, social, and environmental challenges. Investors now frequently examine ESG reports before making an investment. Moreover, the competition could already be leaps and bounds ahead, showcasing their ESG performance, leaving your business behind.  

Here are a few things ESG can do for your company: 

  1. Businesses with solid ESG programs have better reputations and are more appealing to investors. Consumers also consider these companies more trustworthy. 
  2. An ESG program requires data. You need accurate information from many areas to measure the sustainability of your business and guide your strategy. This data will help you understand your company and its opportunities and risks better. 
  3. When you make sustainability your core value, you prove your commitment to making the world a better place . 
  4. ESG can help your company be more efficient. An ESG analysis will help you understand where you are and how you can improve. Whether you are lowering your carbon footprint or taking better care of the needs of your employees, what you are in fact doing is becoming more agile and resilient in a world full of certainties. 
  5. ESG can help you build a strong brand. Strong brands are reliable, relatable and honest. They also have a strong mission that guides everything they do. An ESG program defines your mission and gives you strategies to spread it company wide. 

Why ESG?

  • You are trying to build a better company. 
  • Your investors ask you to report on the environmental, social and governance metrics in your organization.
  • Your customers want you to report on the impact your products and services have in the world. 
  • Your employees want you to do better on ESG matters.
  • Your competitors have made changes
  • You want to improve your sustainability, become more efficient and more resilient


O’Leary M. and Valdmanis, W. (2021). An ESG reckoning is coming. In Harvard Review. Accessed from https://hbr.org/2021/03/an-esg-reckoning-is-coming on July 29, 2022.

International Governance and Compliance Association (IGCA) (2021). What is ESG and why is it important? Accessed from https://igca.org/2021/07/08/what-is-esg-why-its-important/ on July 29, 2022

Read the next post in our 11 part ESG Series:
Why Integrate the E, S, and G?


This article just scratches the surface of ESG.

We put together a full ESG Explainer for a deeper dive into environmental, social and governance for best business practices.


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