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What Does ESG Stand For?

Corporate Services • January 16, 2024 • Written by: Ongresso - Business Beyond Borders

The spotlight on Environmental, Social, and Governance (ESG) criteria is greater than ever in an age when global challenges demand a reevaluation of business practices. A company's adherence to a set of standards known as ESG indicates that it is committed to sustainable and ethical business practices. Together, these three factors environmental impact, social impact, and governance structures—form a comprehensive framework that goes beyond conventional profit-centric methods.

Understanding ESG

Environmental:
  • Pay attention to your ecological footprint
  • Taking care of resource consumption and carbon emissions
  • Dedication to climate change mitigation through sustainable practices
Social:
  • An assessment of the influence on society
  • Taking into account ties with suppliers, customers, workers, and communities
  • Incorporating community involvement, labor practices, and diversity
Governance:
  • A focus on the systems and procedures that direct decision-making
  • Openness and morality in governance methods
  • Respect for the law and morality in order to build confidence among stakeholders

Benefits of Embracing ESG for Companies

 Competitive Advantage:
  • Customer Preferences: According to a survey, 66% of participants are willing to pay more for products that are better for the environment.
  • IT professionals: To increase market competitiveness, 70% would pay more for IT products from suppliers that have strong ESG policies.

Improved Cash Flow:

  • Operational Efficiency: Costs can be decreased and ROI (Return of Investment) can be increased with ESG initiatives, even modest ones like going paperless.
  • Regulatory Compliance: Maintaining ESG compliance has a positive financial impact by lowering exposure to fines and penalties.
Drawing Lenders and Investors:
  • Interest from Investors: According to a Gallup poll, 50% of investors are considering sustainable investment funds.
  • Forecast: A Dow Jones survey highlighted the increasing importance of ESG in financial decision-making by projecting that ESG investments would double over the next three years.

Bildschirmfoto 2024-01-16 um 15.25.25source: statista.com

Ecologically Friendly Operations:

  • Adaptability: Businesses with an ESG integration can find ways to cut expenses, use less energy, and run their operations more efficiently overall.
  • Future-Proofing: Embracing ESG principles now helps businesses get ready for future legal, regulatory, and reputational environments as ESG reporting continues to gain traction.

How to obtain ESG certification


1. Phase of Initial Assessment:
  • Assess current ESG practices in relation to certification requirements.
  • Determine your areas of strength and progress.
  • Establish attainable objectives to obtain certification.

2. Stage of Documentation Review:

  • Send in pertinent documents demonstrating your adherence to the ESG guidelines.
  • Governance policies, CSR initiatives, and sustainability reports are a few examples of documents.

3. Stage of On-Site Auditing:
  • For verification, auditors pay the organization a physical visit.
  • Engage in dialogue with different divisions, staff members, and stakeholders, thorough evaluation of ESG practices in an actual setting.

 

4. Stage of Certification Decision-Making:

  • Auditors compile their findings into a thorough report.
  • The report is reviewed by the certification committee.
  • Final judgment based on suggestions from the auditor.
  • ESG certification is awarded to successful organizations.

Achieving ESG certification is a journey rather than a destination that, with careful navigation, can result in long-term company growth and beneficial social impact.

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Ongresso's ESG Services in Latin America

  • ESG Sovereign Analysis: Ongresso provides ESG Sovereign Analysis, a rigorous process assessing the ESG performance of nations and sovereign entities in the vast region of Latin America. By identifying and reducing possible risks, this analysis gives companies a tactical advantage for expansion and long-term growth.
  • ESG Supply Chain Due Diligence: Ongresso offers ESG Supply Chain Due Diligence as a way to bolster supply chain capabilities. By identifying and resolving risks pertaining to labor practices, environmental impact, and other crucial ESG issues, this service assesses and enhances ESG performance.

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Why Choose the ESG Solutions from Ongresso?

  • Strategic Necessity: In an ever-changing global landscape, ESG practices are not just a corporate trend but a strategic requirement that ensures sustainable growth, risk mitigation and enhanced reputation.
  • Audience Expectations: Ongresso's ESG solutions enable businesses to meet and surpass the expectations of investors, clients, and communities regarding sustainable business practices.

Stakeholder expectations, standards, and regulations

  • Global Mandates: New laws are being implemented by governments all over the world, requiring businesses to strengthen their ESG reporting and perform thorough due diligence in their supply chains, with an emphasis on the effects on the environment and human rights.
  • Stakeholder Demands: Communities, consumers, and investors are putting more and more pressure on businesses to demonstrate progress on environmental, social, and governance issues, such as working conditions, diversity, equity, and inclusion, pollution and waste, and carbon footprint.

Claims of Sustainability and Sovereign Risk

  • Supporting Claims: As a proactive step to reduce risks and guarantee continuous improvements, Ongresso helps companies support their claims about sustainability and improve supply chain procedures.
  • Sovereign Influence: Ongresso's strategic guidance takes these factors into account for sustained excellence because it recognizes that the countries and territories in which a company and its supply chain operate directly influence financial performance and exposure to ESG concerns.

 

More than two-thirds of CEOs globally (69%) have fully embedded environmental, social and governance (ESG) considerations into their business, according to recent research by professional services firm KMPG.

 

With the unmatched ESG services from Ongresso, you can reach new heights of success. Improve your company, adhere to legal requirements, and make a long-lasting beneficial influence. Get in touch with us right now to discuss a strategic alliance that turns obstacles into opportunities.



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