Environmental, Social, Governance or ESG is the prevailing term of the stakeholder ecosystem and main factors deciding a company's sustainability footprint and the corresponding risks and impacts of investment.
The consideration to ESG has risen dramatically in recent years as both public and investor sentiment have shifted from increased awareness, activism, and qualitative data that has matured with an industry underpinned by risk.
Frameworks and methodologies have advanced along with tools and technology to better understand and mitigate ESG risks.
However, the complexities and changing dynamics of environmental, social, and governance factors demand quality data and augmented intelligence. There remain critical gaps and shortcomings, especially in certain industries and certain parts of the world.
Advancements in technology and new data sources are lowering costs and increasing access beyond major corporations and large institutional investors.