[S;Social ⓒESG.ONL/ESG Today]
ESG is an acronym created from the first letters of Environmental, Social, and Governance. Until now, key standards for evaluating business value were quantitative metrics and financial performance, such as financial statements. However, ESG is an index designed to examine what enables long-term, sustainable corporate operations. Driven by a global recognition that metrics determining enterprise perception and investment direction can no longer be limited to financial performance, it demands attention to the actual environment surrounding companies. In fact, renowned international credit rating agencies such as Moody’s, Fitch, and Standard & Poor’s have included ESG criteria when assessing corporate credit since 2019. As highlighted by the widely used phrase 'ESG Management', ESG serves as three core non-financial indicators—Environment, Social, and Governance—that will act as important benchmarks for stably enhancing the financial value of companies and their businesses over the mid-to-long term.
The 'S' in ESG stands for Social. This refers to the efforts that companies, which are not isolated entities but members of society, must make toward mutual growth. It measures whether a company respects social members—such as employees, suppliers, local communities, government, and customers—and aims to build long-term, sustainable relationships.
[ⓒ Korea Exchange, ESG Information Disclosure Guidance]