Businesses the world over are increasingly being judged by
regulators, stakeholders and civil society on their sustainability
or 'ESG' (environmental, social and governance) practices.
The assessment of a company's ESG profile is progressively
becoming a driver of decision-making, with consumers looking for,
and investors relying on, ESG metrics as key criteria for
engagement.
In recognition of the criticality of the environmental agenda,
regulators (such as in the EU) have mandated standards for
environmental reporting and are pushing towards a carbon-neutral
economy, and the S&P 500 ESG Index periodically ranks companies
within industries on ESG criteria and excludes those that have been
underperforming. Poor performance on the environmental front could
also mean alienating investors and consumers - for instance, Forbes
India reported that Quantum Advisors and Quantum Mutual Fund
divested their entire shareholding in a major engineering and
construction company
