Circular economy in brief N. 7 | ESG, a must have for companies

September 12, 2017

Circular economy in brief N. 7 | ESG, a must have for companies

Corporate Social Responsability goes through circular economy. In this regard the European Commission wants ever greater transparency in terms of ESG ( environmental, social and governance) benchmarks .The acronym became, in effect, an essential standard to define a sustainable approach to investments
 
ESG refers to the three central factors in measuring the sustainability and ethical impact of a company and its includes all the element of Corporate Social Responsibility.
 
In particular the environmental part of ESG takes into account the performance of company in terms of CO2 emissions, air and water pollution, waste and deforestation. The social part of ESG criteria is instead referred to human rights, gender policies, working standards and community relations while governance refers to corporate governance practice, remuneration policies, the composition of the Management Board, control procedures conduct of the management and respect of professional ethics.
 
It’s evident that circular economy is included in the environmental part of ESG criteria.Through the implementation of a sustainable business model company can choose, for example, to improve waste recovery transforming waste into value.
 
But why a company should apply ESG criteria?
 
On one side because rating agencies are increasingly ethics and to be virtuous in the application of ESG means access to credit. On other side because European Union, beside awarding eco-innovative companies,  has made mandatory some aspects such as the inclusion of circular economy-oriented strategies in the best available techniques references documents (BREFs)
 
In brief circular economy means improvements of company performance. Sustainability and competitiveness go hand in hand in determining the success of a company.
 
Well, leaving a big environmental footprint is not worthwhile! For both the environment and business!