Environmental describes how an organization interacts with its surroundings in its operations, including how consumers use the company’s products.
Social (as in responsibility) defines interactions with society. Companies have stakeholders - those who affect or are affected by the company. Social responsibility makes all of society’s stakeholders in the company, including future members of society. It is more than philanthropy. Charitable works are part of the company’s social footprint, but relationships characterize our responsibility to society.
Corporate governance is about who runs the company and how they are running it. How are employees treated? Customers? Does the company exceed federal guidelines for accountability, safety, diversity, and environmental compliance?
Environmental responsibility, social relationships, good governance all imply good stewardship. Stewardship means the careful and responsible management of something entrusted to one’s care – e.g., the environment, the global community, stakeholder relationships, employee relationships, and future generations.
Companies have standards and procedures in place for HSE or HSSE (Health, Safety, (Security), Environment). HSE is a framework that provides governance while adhering to local, state, and federal rules in the areas mentioned above. ESG principles are an extension of these standards.
In summary, ESG = Sustainability.