You might have heard the term “ESG” floating around in conversations with your CEO, CIO, or CTO. While emerging technologies such as Generative AI, IoT, Blockchain, and Cloud are still major topics in boardroom discussions, ESG (Environmental, Social, Governance) goals are gaining significant attention. Learn more about executives’ growing interest in sustainability, common challenges in implementation, and how the right technology can drive strategic ESG initiatives.
The Evolution of ESG Priorities
Companies worldwide are setting clear goals towards carbon neutrality, greenhouse gas emission reduction, clean renewable energy and materials, water reuse and recycling, as well as addressing IT waste, health and safety issues, employee diversity, and data security. Organizations are actively investing in these activities and reporting the data publicly.
So, why has ESG suddenly become a huge priority? Let’s break it down.
From the 2000s to 2010s, many companies set large corporate commitments and aligned with voluntary frameworks related to environmental sustainability. Reporting and compliance were often informal and depended on regional guidelines. However, in the past five years, things have changed drastically. New regulatory frameworks and standards such as ISSB, GRI, CSRD, and SEC regulations have been introduced, putting more pressure on organizations to be transparent and accountable.
The increased focus on ESG issues is not just about regulations; it’s also about risk. The media and analysts have highlighted ESG issues as potential material risks that could impact an organization’s overall ability to drive long-term value creation.
As a result, governments in the U.S., U.K., Australia, New Zealand, and the European Union have introduced stricter regulations on environmental waste, climate change, data privacy, and social issues. This regulatory shift has made ESG compliance more critical than ever.
