Manage and Assess Your ESG at GSE
ESG is increasingly the benchmark by which investors determine a company’s health – ethically, financially, and environmentally.
What is ESG?
Environmental, Social, and Governance (ESG) is an essential set of standards and practices for a company’s operations. Envionmental criteria consider the company’s impact on the environment, including GHG emissions, water usage, and other environmental standards. Social criteria measure the company’s relationships with the people it serves both internally (employees) and externally (suppliers, customers, communities, etc.) Finally, governance pertains to the company’s leadership, including executive pay, audits, internal controls, and shareholder rights, if applicable.
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Why is ESG Important?
Simply put, ESG is used by investors to screen potential investments. Companies with low ESG may be a risk due to their environmental practices, while companies with a high ESG may be a better investment. In fact, investors are increasingly applying ESG as part of their analysis to identify material risks and growth opportunities.
ESG is a crucial differentiator for socially responsible investors. These investors consider it essential to incorporate their values and concerns into their investments, instead of just looking at profitability or other traditional markers of business health.
Other things to consider when discussing ESG:
- Companies with strong ESG profiles are more competitive than their peers. (Gregory, Tharyan, and Whittaker (2014))
- High ESG-rated companies use their competitive advantage to generate abnormal returns, which ultimately leads to higher profitability, which in turn leads to higher dividends. (Gregory, Tharyan, and Whittaker (2014)}
- ESG ratings are now part of the decision criteria for investors, both private and institutional. (Gregory, Tharyan, and Whittaker (2014)
- High ESG-rated companies are typically better at developing long-term business plans and long-term incentive plans for senior management.
- High ESG-rated companies experienced lower levels of beta* and, therefore—in the context of the CAPM—lower costs of capital.
How GSE Can Impact Your ESG
Our proprietary technology, VIRIDIS, is a key differentiating factor that helps companies improve their ESG. We do this by:
Identifying key ESG points for your company
Our technology can use wireless technology to monitor anything in your business — from walk-in freezers to flat-tops to toilets to HVAC units. From the day that our wireless hardware is installed, energy, water, waste, and other utility-specific data is collected and monitored by our engineers. By collecting data, we are able to identify and prioritize which locations are environmentally healthy – and which need a bit more work.
Collecting data
With our wireless technology installed and ESG drivers identified and prioritized, we are able to understand the baseline for your company and locations. This step is integral to tracking the effectiveness of your ESG program and reporting to your investors and stakeholders. We take a data-first approach to making the best decisions for your business – and the environment.
Helping set SMART ESG goals
With the baseline identified, now we can work together to set SMART (Specific, Measurable, Achievable, Relevant, and Time-Bound) goals. These goals can be linked to environmental standards, like the UN climate targets, or against your company’s internal goals.
Ready to impact your ESG?