ESG is a sustainable investment practice that considers the impact and risks of environmental, social and governance (ESG) factors, as well as potential financial return in a project or company. To provide an ESG score, independent rating agencies will evaluate company practices and risk profiles. An organisation with a high ESG rating indicates good practices that manage environmental, social and governance risks well. Such companies should experience fewer setbacks and provide investors with a more stable long-term financial reward than those with a poor ESG score.
