3 minute read
Corporate Social Responsibility (CSR) and Environmental, Social and Governance (ESG) are both terms used to describe a company’s commitment to ethical and sustainable practices but they have some key differences.
Corporate Social Responsibility typically refers to a company’s voluntary actions to take into account the economic, social and environmental impacts of its operations on society and the environment. CSR is often associated with philanthropy and community engagement, such as charitable donations and volunteer programmes.
Environmental, Social and Governance is a more comprehensive framework that includes the three key factors that investors and stakeholders use to assess a company’s performance and potential for long-term success. ESG includes a company’s impact on the environment, its treatment of workers and other stakeholders, and its overall governance practices.
ESG is considered a more holistic approach to CSR, as it takes into account a wider range of factors that can impact a company’s long-term performance, including environmental and social issues as well as governance practices. ESG is also increasingly used by investors to evaluate the sustainability and risk profile of a company and its potential for long-term growth.
To summarise, CSR is a more traditional approach to corporate responsibility and focuses primarily on a company’s philanthropic and community-based activities, while ESG is a more comprehensive framework that includes a broader range of factors, including environmental and social issues, as well as governance practices, and is used by investors to evaluate a company’s sustainability and potential for long-term growth.
If you would like to know more about ESG, why your business should care about it and whether you need an ESG solicitor, read our article, ESG: Why solicitor guidance is key.
Our team of expert corporate and employment solicitors can support your ESG policy implementation in a practical way. For example, in the drafting of contracts with your suppliers or through advice around the development of employment policies.
If you would like to speak with an expert, contact us today to arrange an appointment.
