Sustainable Investing Glossary

ESG definition

What is the definition of ESG?  ESG means using Environmental, Social and Governance factors to evaluate companies and countries on how far advanced they are with sustainability. Once enough data has been acquired on these three metrics, they can be integrated into the investment process when deciding what equities or bonds to buy.

ESG factors: Environmental

Environmental factors include the contribution a company or government makes to climate change through greenhouse gas emissions, along with waste management and energy efficiency. Given renewed efforts to combat global warming, cutting emissions and decarbonizing is become more important.

ESG investing
ESG investing
Wir integrieren Umwelt-, Sozial- und Unternehmensführungskriterien (ESG) in den meisten fundamentalen und quantitativen Strategien.

ESG factors: Social

Social include human rights, labor standards in the supply chain, any exposure to illegal child labor, and more routine issues such as adherence to workplace health and safety. A social score also rises if a company is well integrated with its local community and therefore has a ‘social license’ to operate with consent.

ESG factors: Governance

Governance refers to a set of rules or principles defining rights, responsibilities and expectations between different stakeholders in the governance of corporations. A well-defined corporate governance system can be used to balance or align interests between stakeholders and can work as a tool to support a company’s long-term strategy. 

Governance can also refer to the standard of government of nations. Robeco measures ESG levels using RobecoSAM’s proprietary Corporate Sustainability Assessment for companies, and Country Sustainability Ranking for governments, to give overall ESG scores. There is some crossover between the two, particularly for multinational companies.

Also read: ESG funds

Ein weiteres sehr gutes Jahr für nachhaltiges Investieren
Ein weiteres sehr gutes Jahr für nachhaltiges Investieren
Robeco und RobecoSAM hatten 2019 erneut ein sehr gutes Jahr, was ihr weltweit führendes Angebot an nachhaltigen Geldanlagen angeht.
20-02-2020 | Einblicke
SAM publishes Sustainability Yearbook 2020
SAM publishes Sustainability Yearbook 2020
SAM has published its annual yearbook showcasing the sustainability performance of the world’s largest companies.
03-02-2020 | Einblicke
Ausschlüsse verschieben möglicherweise bloß ein Problem
Ausschlüsse verschieben möglicherweise bloß ein Problem
Haben Ausschlüsse Erfolg?
03-02-2020 | Research