ESG: Environmental, Social & Governance

Over a relatively short period of time, the implementation of ESG (environmental, social and governance) aspects in commerce has grown to become a strategic priority at management level. While the substance of ESG is likely to evolve in the coming years, the underlying impulse for businesses to make a social contribution, and not just an economic one, is here to stay. In essence, it is about maintaining and reinforcing the social licence of a business to operate in a rapidly changing world. As a result, ESG goes to the heart of every business.

Future-looking companies

Not all aspects of E, S and G are priorities for all companies. Companies will carefully have to weigh which ESG aspects they want to focus on. For that reason, it is instructive to observe organisations that approach ESG in a rigorous, strategy-driven, socially attuned way. McKinsey calls these organisations ‘forward-looking companies’. They make ESG intrinsic to their strategy by deliberately applying those ESG aspects that connect to the core of their business. Forward-looking companies also promote competition by standing out and using good corporate citizenship to contribute to finding solutions to existential challenges, such as climate change.

Distinguishing role

Whatever your company's ambition, you will always need to comply with the ESG regulations, including those on environmental legislation, labour-law issues and governance. But forward-looking companies take it one step further, and usually raise the bar by focusing on certain aspects of ESG in which they can play a leading or distinguishing role. Ideally, this will also motivate similar companies to take a comparable route when it comes to ESG.

Roadmap to social profit

This ESG special publication provides company lawyers a concise overview of the most important ESG regulations, as well as concrete tools to give managers better advice in the field of ESG. Various aspects and elements of a company will be discussed: from the distribution chain to commercial property, from sustainable financing issues to the desired level of diversity and inclusivity within the population, and from governance to ESG litigation.