ESG (Environmental, Social, and Governance) practices are essential to strengthen a company's reputation and reliability. In the current market, organizations that invest and stand out in the area are often cited as leaders in social and environmental responsibility, achieving positive impacts on their operations and, consequently, on their financial results.
The commitment to ESG criteria has a significant impact on corporate governance, resulting in important changes in the way companies are managed, evaluated and perceived by society. Practices require the implementation of clear metrics and indicators, which strengthens accountability and promotes greater transparency in corporate operations and processes.
Decision-making is now based on risks (environmental, social and regulatory), which contributes to promoting business sustainability. Furthermore, companies that follow ESG practices prioritize engagement with stakeholders – as investors, customers, employees and communities – who start to see them as more responsible and committed.
The greatest confidence in stakeholders encourages a more inclusive dialogue, considering diverse needs and expectations. This alignment with contemporary values generates identification and admiration among both consumers and investors, not to mention society in general. Sustainable and ethical action reduces the risk of scandals, environmental damage and inappropriate practices, strengthening the positive perception of the brand.
With regard specifically to investors, it is already proven that they prefer companies with good governance and sustainability practices. Regarding current consumption patterns, several surveys show that modern consumers prefer brands that demonstrate responsibility. Meanwhile, employees of organizations committed to good practices tend to feel more proud of their work and, therefore, be more motivated and productive.
However, for results to be truly achieved, engagement must be true. Today, there is a lot of talk about the green wash and the social washing, practices in which, respectively, companies try to create a false impression of commitment to issues linked to environmental sustainability and important social causes. Run away from them! Anything that involves the dissemination of misleading messages or campaigns is highly harmful. The real commitment to ESG practices is the secret for the path to be long and prosperous.
