Today, more investors want their money to do more than just make profits. They want it to support companies that care about people, the planet, and fair business. That’s where ESG comes in. ESG stands for Environmental, Social, and Governance. These are three things investors now look at before putting their money into a company.
Environmental means how a company treats the planet. Is it working to reduce pollution? Does it use clean energy? Is it helping fight climate change?
Social is about how a company treats people. This includes its workers, customers, and the communities around it. Are employees treated fairly? Is the company inclusive? Does it give back to society?
Governance is about how the company is run. Is it honest? Are leaders making fair decisions? Does it avoid corruption and follow the rules? More and more investors want companies to do well and do good. They believe that companies that care about these things are more likely to succeed in the long run. A business that protects the environment, treats people right, and is run fairly usually has fewer scandals, happier employees, and loyal customers. That means stronger, more stable returns.
Investor advocacy is also growing. This means investors are not just watching what companies do — they are speaking up. They’re pushing companies to act on climate change, improve working conditions, and be more transparent. Some investors are even voting at company meetings or starting conversations with CEOs to demand better practices.
The message is clear: it’s not just about profits anymore. It’s about purpose, too. And smart investors are making it known — if companies want their money, they need to step up and show they care.