ETHO NEWS

EthoWork's Newsletter Archive

This collection of past newsletters is filled with valuable insights on sustainability and circularity tailored for small and medium-sized enterprises (SMEs). You'll find content designed to support your business on its sustainability journey. Dive in and explore how you can make a positive impact on your supply chain, operations, and beyond.

EthoWork is now an EcoVadis Training Partner!

28 December 2023

EthoWork is happy to announce that we have been chosen as an Approved Training Partner of EcoVadis, the leading provider of globally trusted business sustainability ratings. 

As an EcoVadis Training Partner, we can:

• Help companies understand the ins and outs of the EcoVadis ratings methodology

• Support companies with EcoVadis assessment completion

• Help companies in reviewing their EcoVadis scorecards and Corrective Action Plan (CAP)

• Mitigate their CAP

• Support companies with their sustainability program initiatives and best practices deployment as per the four pillars of the EcoVadis Methodology

Contact us today for assistance with your EcoVadis assessment process!

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What is the difference between ESG and sustainability?

By Susan N. Spencer, EthoWork Learning

9 October 2023

3 min read

ESG is quite a buzzword these days. But for a company, does it mean the same thing as sustainability? In this article, we'll take a look these two related concepts.

Help Me Understand ESG!

'ESG' stands for the Environmental, Social, and Governance practices undertaken by an organization. It's a set of criteria that investors and businesses can use to evaluate a company's performance and impact in these areas. The operative word here is 'investors': ESG is involves financial metrics and reporting. 

On the 'E' side, a company's Environmental practices and their impacts are assessed. This includes examining their carbon emissions through the use of greenhouse gas calculations, their resource conservation efforts, and their current and planned efforts to combat negative environmental outputs throughout their supply/value chain.

The 'S' of ESG refers to the way a company treats its people, or the 'Social' aspect. Another common term for this is CSR, or "Corporate Social Responsibility." Here, we are looking at a company's practices toward its employees throughout its supply chain and headquarters operations. This includes everything from labor/employee health and safety in contracted factories, to diversity, equity, and inclusion (DEI) practices and corporate community engagement.

Lastly, the 'G' of ESG examines a company's leadership and Governance practices. It looks at the structure of an entity's business ethics, shareholder rights (if publicly held), its board of directors, and even its executive compensation. Transparency for all stakeholders, including the end consumer, is the operative word here.

How Does ESG Relate to Sustainability?

Simply put, sustainability is a much broader and more encompassing concept than ESG. While it also includes economic, social, and environmental aspects similar to ESG, sustainability refers to the ability to meet the needs of the present without compromising the ability of future generations to meet their own needs. 

Economic sustainability focuses on the ability of a company to be financially viable in the long term whilst still doing its best across specific sustainability initiatives. It involves monitoring a company's resilience, profitability, and resource allocation.

Social sustainability is similar to the "S" in ESG, meaning that we are also looking at the treatment of workers, employees, and management throughout a company's owned and contracted supply chain. It looks at frameworks such as the UN's Sustainable Development Goals (SDGs) and how a company's efforts align with them on key issues such as human rights, well-being, and social equity.

Environmental sustainability also focuses on minimizing negative environmental impacts and promoting responsible resource use; specifically broader and longer-term goals. An example of this might be a company's declaration in their annual sustainability report that they aim to be carbon neutral by 2030, or seven years out.

What Does this Mean to Me? What Actions Should I Take?

Think of ESG as a "subset" of sustainability. It zeroes in on the three key areas of a company's environmental, social, and governance policies and implementations that are important for assessing the performance and behavior of companies from an investor's perspective. Given the upcoming onslaught of California, New York, U.S., and EU environmental regulations pending and currently being implemented, it will be important for a company to develop and implement ESG measurements, reporting, and initiatives both on a mandatory and voluntary basis. 

It's important to consider both the financial/ESG and larger sustainability lenses for your company. Remember, sustainability looks at the "big picture" of how a company considers its economic, social, and environmental aspects within global frameworks for long-term operational decision-making responsibility.  A company's sustainability report should not only show the measurements gleaned from its ESG efforts, but also align its long-term sustainability goals to larger global social, economic, and climate targets, such as the UN SDGs and the United Nations Framework Convention on Climate Change goals.

If you need help in deciphering, measuring, creating, and/or implementing your ESG/Sustainability strategy, EthoWork can help. Contact us today - it's what we do!