· The environmental impacts and risk management procedures of an organization are referred to as environmental factors.
· These include the firm's overall resilience to physical climate threats, management's stewardship of natural resources, and direct and indirect greenhouse gas emissions (like climate change, flooding, and fires).
· The relationships a company has with its stakeholders are referred to as the social pillar. Human capital management indicators, such as fair salaries and employee engagement, as well as an organization's influence on the communities in which it operates, are examples of elements that a corporation may be judged against.
· The social impact expectations that have been extended to supply chain partners, particularly those in developing economies where environmental and labor regulations may be less stringent, is a distinguishing feature of ESG.
· Corporate governance describes the direction and management of a company.
· In order to better understand how shareholder rights are perceived and upheld, how incentives for leadership are aligned with stakeholder expectations, and what kinds of internal controls are in place to encourage leadership accountability and transparency, ESG analysts will look at these and other factors.