Environmental Social Governance

Definition ∞ Environmental Social Governance, or ESG, refers to a set of standards used by investors to screen potential investments based on a company’s impact on environmental, social, and governance factors. Environmental criteria consider a company’s energy use, waste, pollution, and resource conservation. Social criteria examine its labor practices, diversity, and community relations. Governance criteria assess leadership, executive pay, audits, and shareholder rights.
Context ∞ ESG considerations are increasingly important in traditional and digital asset markets, influencing investment decisions and corporate strategies. The cryptocurrency sector faces scrutiny regarding its environmental footprint, particularly for proof-of-work networks. Discussions center on developing sustainable blockchain solutions and leveraging distributed ledgers for transparent ESG reporting.