ESG

How to Discover your ESG Rating and Attract Socially Responsible Investors

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With investors and customers alike making more of their buying decisions based on the ethics and sustainability of a company, we can help you join the growing number of companies who are ahead of the curb with a ESG report that meets international standards.

We can help you plan, report and showcase your road to net zero carbon while you build a greener tomorrow.

ESG DEFINED

Environmental, Social and Governance (ESG) is increasingly influencing business operations, from stakeholders to investors, regarding how your ESG rating compares and matches up. As we move further into the 21st century, the way in which our businesses operate within their individual hierarchies, and the way we conduct our business, has evolved to encapsulate a forward thinking, socially aware environment.

Broken down between three pillars, the ESG framework encapsulates the fundamentals of modern day to day business operations, providing a standard and guidance towards how companies can fulfil ESG regulations and meet their full potential. From an investment and analysis perspective, financial institutions use ESG criteria and performance to understand the ins and outs of a company’s operations, as well as the future of their performance based on the behaviours and insights of the company.

ESG standards encapsulate the standardized approach that businesses should embrace moving forward. Having transparency and accountability is the future of socially responsible investing, highlighted and showcased by ESG criteria that not only shines publicly, but also ensures that businesses can be proud of their companies. Through elements of accounting and reporting, as well as ESG sustainability strategies and scrutiny of corporate social responsibility, ESG offers opportunities for businesses to lessen the risk of investment through consciousness decision making.

When broken down, Environmental Social Governance captures different areas of a company’s operations to provide focus and scrutiny of different aspects of the business operations:

ESG DEFINED

Environmental

Beginning with the Environmental pillar of the ESG framework, Environmental relates to issues surrounding a company’s performance towards nature and towards the physical environment around it. Encapsulating this CSR issue and embracing it allows companies to present themselves as a steward of ESG issues, as well as minimize risk when relating to issues that could affect the market or supply chain of their operations. The 21st century has brought about environmental issues that offer disruption and high risk to business activities and operations that are unprecedented. Global Climate Change poses a threat to earthly systems as we know it, and the effects of it are already becoming clear. Higher temperatures, unnatural seasons, more frequent and larger severity of natural disasters, rising sea levels, scarcity of commodities and uninhabitable areas are just some of the consequences the earth is already facing as a result of climate change. Businesses and professionals around the world are at risk of their investments and portfolios becoming outdated if they do not embrace solutions and acknowledge environmental issues at the forefront of their operations.

Global climate change legislation and policy established within the public sector, through governments around the world has created a pathway for the private sector to disclose, report on and analyse the way their company can promote and transition their business operations to accommodate for the issue of climate change. Given the size and scope on the issue of climate change, ties between the public and private sectors are growing stronger and stronger, with companies and governments working collaboratively to finance, mitigate and adapt to the effects of climate change by transitioning economic dependence on energy sources into clean, renewable energy.

Companies can do their part through ESG management and reporting to transparently declare their contributions to environmental issues and ESG rating. Through assessment, analysis and research into the impacts of their company operations on ESG factors, businesses can move towards becoming an ESG company. Sustainable futures and potentials reside in strategic planning and initiative that can transform businesses and bolster their environmental credentials, increasing displayed marketability and environmental consciousness.

Customers and consumers are also becoming frequently conscious and aware of environmental issues in the products and services they purchase. Through sustainable growth, companies not only display their commitment to environmental issues to socially responsible investors, but also to the customers and employees who make up the core of their business.

Through Tunley Engineering, by assessing and analysing where your company is today, we can provide you with a strategic plan in order for you to identify and reduce your carbon emissions and transition your business towards a brighter and more environmentally conscious champion of sustainability.

ESG DEFINED

Social

ESG regulation also incorporates and highlights the need to focus on other areas of business operations. The Social pillar in Environmental Social Governance relates to focus on issues surrounding organisational policies, and practices regarding human rights, business ethics, supply chain management, diversity and inclusions, as well as social impacts resulting from corporate operations.

Social standards within a company’s operations have before been somewhat overlooked within the traditional corporate model but have certainly been brought to light as a result of recent events. The COVID-19 pandemic for example, shone light on issues within traditional corporate models regarding their employees and their workplace relationships. Individuals and factions embodying the hierarchical frameworks of the corporate model are taking increasing steps to ensure they take responsibility for their actions to ensure that the people affected by a company’s operations, whether that be customers, employees, stakeholders or civil society, is treated with respect and mutuality.

Understanding a company’s principles and culture is key to empowering corporations who strive to create a workplace with a positive atmosphere, putting workers and customers, as well as members of the public, at the forefront of a transition away from traditional corporate models, and towards a fairer, more inclusive working environment.

ESG DEFINED

Governance

The ESG Governance pillar relates largely to the corporate hierarchy within the leadership and management of the corporate model. Within governance structures, the purpose of corporate operations as well as the key roles of individuals making up the core of governance is deliberated on and discussed.

Ensuring proper and organised management structures are in place are fundamental to successful governance structure and element risk within business operations due to the stability of a well organised hierarchy. The structure and makeup of corporate operations are vital in ensuring governance can be successful, through collaboration and communication, as well as compassion and strong oversight skills, the ESG Governance pillar sets precedent to how the company is managed, and whose voices should be heard throughout the business. Similar to the Social pillar in ESG framework, key issues of inclusivity, fairness and equality are fundamental to ensuring that the hierarchical structures of a business are sound. The evolution and growth of social, political, and cultural attitudes towards the world, as well as the attitudes towards business operations internally, serve as a vitality for a successful business model.

ESG DEFINED

Becoming an ESG Company

The core fundamentals and definition of ESG is to encapsulate the pillars that make up the new corporate model and define business operations, and transition them into a portfolio that is worthy of recognition not just externally, but internally. As aforementioned, Environmental Social Governance transitions companies from the traditional corporate model of old, into the forwarding-thinking extroverted and transparent model idealised by the many. Embracing ESG framework as the new normal within business operations projects companies further and higher.

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