Enter the Environmental, Social and Governance (ESG) criteria. The ESG criteria assesses the impact of a company on the environment, a company’s role in social justice and equality and a company’s ethical standard in how it treats its employees and clients.
Each year, major financial institutions like JPMorgan, Wells Fargo, Goldman Sachs and Chase publish reports that analyze the ESG standards of many companies with investment and stock options.
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Understanding each part of ESG
The “Environmental” part of ESG
Companies that meet the environmental criteria of ESG demonstrate that they take measures to reduce their risks of harming the environment. When assessing a company’s environmental criteria, financial institutions consider the amount of energy a company uses, how much waste and pollution it generates and how it treats plants and wildlife.
The “Social” part of ESG
Companies that meet the social criteria of ESG demonstrate that they take measures to value human life and are respectful toward other businesses and the community. When assessing a company’s social criteria, financial institutions look at a company’s diversity, its stance on human rights, how it values the consumer and how it interacts with the community and other businesses.
The “Governance” part of ESG
Companies that meet the governance criteria of ESG demonstrate that they operate within well-rounded ethical standards. When considering a company’s governance criteria, financial institutions look at how a company treats its employees, its stakeholders and its clients. Companies that treat all of these people well are considered to meet the governance criteria of ESG.
Do you need help making an investment decision based on ESG? Or does your company need to improve its ESG-related standards? It’s time to talk to a CFP at ProVise Management Group
We work hard to develop a personalized financial plan that works best for you or your business without sacrificing your values. We provide this plan at a fiduciary standard of care and offer an unconditional money back guarantee if you are not satisfied with it. If for any reason you are not satisfied with the written plan, simply return it to us and we will refund 100% of the fee paid. Once presented and accepted, we will create an implementation strategy and then establish a monitoring system that meets your needs.
Whether you’re an investor who’s looking for opportunities to invest in a business that reflects your ethical values or if you work for a business that’s looking to improve its ESG compliance, our CFP are ready to help.
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