ESG Assurance ESG Assurance refers to independently verifying and providing assurance on a company's Environmental, Social, and Governance (ESG) performance and reporting. ESG factors are increasingly important for investors, stakeholders, and the broader public as they seek to understand a company's impact on the environment, social practices, and governance structures.
The three main components of ESG are: 1. Environmental (E): This involves a company's environmental impact, including its carbon footprint, energy consumption, waste management, and other factors. 2. Social (S): This pertains to a company's relationships with its employees, suppliers, customers, and the communities in which it operates. Social factors include labour practices, diversity and inclusion, human rights, and community engagement. 3. Governance (G): Governance focuses on a company's internal controls, leadership structure, executive compensation, shareholder rights, and overall corporate governance practices.
External auditors or assurance providers typically carry out ESG assurance. They evaluate and verify the accuracy and reliability of the company's ESG disclosures, ensuring that the reported information is by established standards, frameworks, and guidelines. Some commonly used ESG