Article Metadata
| Article Type | Reference |
| Product | SupplierOne |
| Effective Date | 10/05/2026 |
| Last Reviewed | 10/05/2026 |
| Author | Chandra Nicks |
Prerequisites
| Required Role | Any |
| Required Plan | SupplierOne |
| Other Requirements | N/A |
TL;DR Summary
- ESG stands for Environmental, Social, and Governance
- Environmental (E) – assesses environmental impact and sustainability efforts
- Social (S) – evaluates relationships with employees, customers, and communities
- Governance (G) – how a company is managed and upholds ethical/legal standards
Introduction
This article explains what ESG (Environmental, Social, and Governance) means and describes each of the three ESG dimensions as they apply to supplier assessments on Supplier.io.
Procedure
| Note: ESG factors are increasingly used by buyers to evaluate suppliers. Keeping your sustainability certifications and company information up to date on SupplierOne helps ensure accurate ESG assessments. |
Expected Outcome
You have a clear understanding of ESG and how each dimension — Environmental, Social, and Governance — is used to assess a company’s sustainability and ethical practices.
ESG stands for Environmental, Social, and Governance. ESG factors are used to assess a company’s overall sustainability and ethical practices.
- Environmental (E):
- This aspect assesses a company’s impact on the environment. It includes factors such as a company’s carbon footprint, energy efficiency, water management, waste management, and overall environmental sustainability efforts. ESG factors related to the environment often focus on issues like climate change, resource conservation, and pollution control.
- Social (S):
- The social dimension of ESG encompasses a company’s relationships with its employees, customers, communities, and other stakeholders. It involves evaluating issues like labor practices, employee diversity and inclusion, human rights, community engagement, and product safety. Social ESG criteria often consider topics like employee well-being, fair wages, and ethical supply chain practices.
- Governance (G):
- Governance refers to the way a company is managed and how it upholds ethical and legal standards. It includes factors like board composition, executive compensation, shareholder rights, and transparency in financial reporting. Governance ESG criteria focus on issues such as the independence and expertise of the board of directors, ethical leadership, and accountability.