What does ESG stand for?

ESG stands for Environmental, Social and Governance - three categories used to assess how an organisation manages non-financial risks and impacts.

The Environmental pillar covers carbon emissions, energy use, waste, water consumption and biodiversity. This is where most regulatory pressure currently sits, driven by frameworks like SECR, ESOS and the GHG Protocol.

The Social pillar addresses workforce practices, health and safety, diversity, human rights across supply chains and data privacy. Social performance increasingly determines contract eligibility, particularly under public procurement rules like PPN 06/21.

The Governance pillar examines board oversight, executive pay, business ethics, anti-corruption and risk management. Governance failures are where the most damaging ESG incidents originate.

Together, these three lenses give investors, regulators and lenders a structured way to evaluate business resilience beyond the balance sheet.