Environmental, social and governance factors, colloquially known
as ESG, is a framework that helps stakeholders understand how an
organization manages risks and opportunities related to the
environment, society, and its internal governance. Indian companies
have started taking steps to further their ESG responsibilities to
attract higher investments and valuations.
The rationale behind this move is simple; companies that work
towards promoting their workers, customers, shareholders and
society are companies that are better run, therefore making them
attractive for long-term investments and high valuations. Holistic
ESG adoption is on the rise in India, creating value and profit for
managers and assuring long-term returns for investors at the same
time.