Glossaries

Wednesday, 16 July 2025, 4:31 AM

Site: ESG Business Institute

Course: ESG Business Institute (ESG Business Institute)

Glossary: Glossary

1% for the planet

An international organization whose members contribute at least one percent of their annual revenue to environmental causes to protect the environment. The aim is to offer accountability, prevent greenwashing, and "certify reputable giving.

Link: https://tinyurl.com/2sjukekb

Anti-retaliation

An employee policy that prohibits retaliation and outlines the procedure for reporting retaliation.

Blue Washing

UNGC Blue washing is the practice of businesses signing up for the UN global compact and then using their affiliation with the UNGC to improve their image and divert attention away from their unethical business practices.

Carbon Credits

Carbon Credit is a generic term for any tradable certificate or permits representing the right to emit a set amount of carbon dioxide or the equivalent greenhouse gases. Carbon credits are generated from global projects that pull Greenhouse Gases (GHGs) out of the atmosphere or keep emissions from being released. One credit permits the emission of one ton of carbon dioxide or the equivalent of other greenhouse gases. Typically companies that have exceeded their carbon emission limit will be purchasing Carbon Credit to offset the GHG released by the organization.

Carbon Footprint

A carbon footprint quantifies the total greenhouse gas (GHG) emissions produced directly and indirectly by an individual, organization, event, or product, typically expressed in equivalent tons of carbon dioxide (CO₂e). This measure encompasses emissions from various activities, including energy consumption, transportation, manufacturing, and waste management.

https://css.umich.edu/publications/factsheets/sustainability-indicators/carbonfootprint-factsheet

Carbon Negative of Climate Positive

Both terms refer to a situation whereby a company removes or captures more CO2 from the atmosphere than it even emits. As a result, the company has negative carbon emissions and positively impacts the climate.

Carbon Neutral

Carbon neutrality means balancing emitting and absorbing carbon from the atmosphere in carbon sinks.

Carbon Offset

Carbon Offset is an action or activity (such as the planting of trees or carbon sequestration) that compensates for carbon dioxide or other greenhouse gases emission into the atmosphere.

Carbon Trading

Carbon trading—also known as carbon emissions trading or the carbon market—is a mechanism that facilitates the buying and selling of carbon credits. Each carbon credit represents a specific quantity of greenhouse gas emissions, typically one metric ton of carbon dioxide equivalent (CO₂e).

https://www.ncmc.sua.ac.tz/news/what-is-carbon-trading

CCS/CCUS

CCUS involves the capture of CO2, generally from large point sources like power generation or industrial facilities that use either fossil fuels or biomass as fuel.

https://www.iea.org/energy-system/carbon-capture-utilisation-and-storage

Circular Economy

The circular economy is a production and consumption model involving sharing, leasing, reusing, repairing, refurbishing, and recycling existing materials and products as long as possible. In this way, the life cycle of products is extended.

COP

COP, or Conference of the Parties, is a global climate summit joined by almost all countries worldwide to address and tackle the pressing issue of climate change. The most recent COP, widely known as COP 27, was held in Sharm El-Sheikh in November 2022.

CSR

In the simplest form, CSR includes all the practices put in place by companies to contribute to social and environmental impact positively.

Environment (ESG)

Environmental criteria consider how a company safeguards the environment, including corporate policies addressing climate change. Energy and water usage, Waste Management, Carbon emission and offset, Toxic product/waste, etc.

Fast Fashion

Fast Fashion is a term used to describe clothing designs that move quickly from the catwalk to stores to take advantage of trends and consumerism. Fast Fashion is widely criticized for polluting the environment, particularly water, and exploiting the workforce in developing countries.

Framework

ESG Framework is a general guideline or principles-based guidance on how ESG information is structured and prepared and what broad topics are covered in an ESG report.

GHG

Green House Gasses (GHG) are any gasses that absorb heat and radiate heat in the earth's atmosphere, which causes the earth to cool down more slowly. Some of the most common GHG include Carbon Dioxide, Water Vapor, Methane, and Nitrous Oxide. Link: https://tinyurl.com/yw5sbs8z

Governance (ESG)

Governance refers to the topic of how a company is governed. These include board and management structures, company policies, executive pay, audits, internal controls, shareholder rights, and more.

Green Washing

Green Washing is where a company spends more resources to falsely market itself as sustainable instead of reducing its environmental impact.

Inclusive Business

Inclusive businesses are companies that develop innovative ways to do commercially viable business with people living at the pyramid's base (BOP) and expand access to basic products and services.

Index or Ratings

An index or Rating is a system that measures companies' financial results that aim to protect the environment rather than earn a quick profit. Generally, companies with better ratings will be favored more by impact investors as they perform better in the measured areas.

International Labour Organization (ILO)

A United Nations agency whose mandate is to advance social and economic justice by setting international labor standards.

Link: https://tinyurl.com/yeyv4ut3

Justice, Equity, Diversity & Inclusion (JEDI)

Justice, Equity, Diversity, and Inclusion (JEDI), are four guiding principles to create a good working environment.

Link:https://tinyurl.com/bdewu6mn

Lean Economy

Lean economics is the means of maintaining the stability of an economy that does not grow. Its institutions are designed as essential means to manage and protect its small scale.

Link: https://tinyurl.com/5f7dnnmm

Living Wage

The Global Living Wage Coalition (GLWC) defines a living wage as the remuneration received for a standard workweek by a worker in a specific location, sufficient to afford a decent standard of living for the worker and their family.

https://www.globallivingwage.org/about/what-is-a-living-wage/

Materiality

In an ESG context, Materiality refers to a topic, area, or information that could influence financial outcomes or impact created in an organization.

Minimum Wage

The minimum amount of remuneration that an employer is required to pay wage earners for the work performed during a given period, which cannot be reduced by collective agreement or an individual contract.

https://www.ilo.org/topics/wages/minimum-wages/how-define-minimum-wage

Negative Screening

Negative screening is defined as finding companies that score poorly on environmental, social, and governance (ESG) factors relative to their peers.

Link: https://tinyurl.com/ys38w4u2

Net Zero

From the lance of sustainability, Net Zero refers to the state where decarbonization initiatives offset the total carbon released to the environment. Such as tree planting, purchasing Carbon Credit, switching to green energy, etc.

Network for Greening the Financial System (NGFS)

A network of 114 central banks and financial supervisors that aims to accelerate the scaling up of green finance and develop recommendations for central banks' role in climate change.

Link: https://tinyurl.com/39dm25wb

Nexus

Nexus is the leading global knowledge hub for managing and sharing water, Energy, and food security resources. It enables practitioners, researchers, and policymakers to think beyond sectors to ensure access to water, Energy, and food for all.

Link: https://www.water-energy-food.org/about-us

Organisation for Economic Co-operation and Development (O.E.C.D.)

The Organisation for Economic Co-operation and Development (OECD) is an international organization that works to build better policies, establish evidence-based international standards and find solutions to various social, economic, and environmental challenges.

Link: https://tinyurl.com/yc2myhau

Pink Washing

Pink Washing is defined as The corporate or political misuse of the LGBTQIA+ movement to promote themselves as "gay-friendly" to win progressive support while concealing contrary features and actions.

Positive Screening

Positive screening is finding companies that score highly on environmental, social, and governance (ESG) factors relative to their peers.

Link: https://tinyurl.com/4wb7bdhc

Race to Zero

A UN-led global campaign that seeks to mobilize a coalition of non-state actors to achieve net-zero carbon emissions by 2050. Global Citizen supports this initiative by encouraging individuals and organizations to commit to this goal and take immediate action to combat climate change. .

https://www.globalcitizen.org/en/content/race-to-zero-net-zero-emissions-climate/

Scope 1 GHG Emission

Scope 1 Emission refers to the Green House Gas (GHG) emissions that a company makes directly — for example, while running its boilers and vehicles.

Scope 2 GHG Emission

Scope 2 Emission are the emissions company makes indirectly, such as electricity or energy it buys for heating and cooling buildings.

Scope 3 GHG Emission

Scope 3 Emission refers to all emissions associated, not with the company itself, but that the organization is indirectly responsible for, up and down its value chain (e.g., transportation, etc.)

Shareholder Primacy

A corporate governance philosophy that prioritizes maximizing shareholder value above the interests of other stakeholders, such as employees, customers, and the community. .

https://corporatefinanceinstitute.com/resources/equities/what-is-shareholderprimacy/

Social Enterprise

Investopedia defines a social enterprise or business as a business with specific social objectives that serve its primary purpose. Social enterprises seek to maximize profits while maximizing benefits to society and the environment. The profits are principally used to fund social programs.

Link: https://tinyurl.com/238jjncd

Social Impact (ESG)

Social criteria examine how it manages relationships with employees, suppliers, customers, and the communities where it operates.

Social Responsibility

Social responsibility is a moral framework where organizations and individuals strive to act for the greater good and avoid causing harm to society and the environment.

https://www.humanrightscareers.com/issues/what-is-social-responsibility/

Stakeholder Capitalism

Stakeholder Capitalism is a system in which corporations are oriented to serve the interests of all their stakeholders. The key stakeholders are customers, suppliers, employees, shareholders, and local communities. Under this system, a company's purpose is to create long-term value and not to maximize profits and enhance shareholder value at the cost of other stakeholder groups.

Link: https://tinyurl.com/4umf6f2r

Standard

ESG Standards provide specific, detailed, and replicable requirements for what should be reported for each topic, including metrics to measure your ESG initiatives.

Supply Chain Due Diligence

Supply chain due diligence is a process in which a company researches and investigates potential suppliers to identify any risks associated with those businesses. Typically these risks will range from legislative and governance issues to ethical and environmental concerns. For example, companies may need to ensure that the suppliers they work with are not involved in practices such as money laundering, child labor, human trafficking, corruption and bribery, and environmental damage.

By implementing a supply chain due diligence policy, companies can identify any risks from working with different suppliers. Increasingly, supply chain due diligence is used to ascertain whether proposed suppliers align with the company's ESG goals and requirements. As a result of this due diligence, companies can then decide whether to work with specific suppliers and whether suppliers should be asked to take any corrective action before carrying out work for the company.

Link: https://tinyurl.com/59nhhsd8

Sustainability

Sustainability means doing business without negatively impacting the environment, community, or society. United Nations Brundtland Commission defined sustainability as "meeting the needs of the present without compromising the ability of future generations to meet their own needs."

Sustainability Roadmap

The sustainability Roadmap guides companies in integrating sustainability-related goals and strategies across the organization.

Sustainable Building

The U.S. Environmental Protection Agency (EPA) defines sustainable building as the practice of creating structures and using processes that are environmentally responsible and resource-efficient throughout a building's life cycle—from siting to design, construction, operation, maintenance, renovation, and deconstruction.

https://archive.epa.gov/greenbuilding/web/html/about.html

UNGC

The United Nations Global Compact is a voluntary initiative based on CEO commitments to implement universal sustainability principles, undertake businesses and firms worldwide to adopt sustainable and socially responsible policies, and report on their implementation.

United Nations Development Programme (UNDP)

The United Nations Development Programme is a United Nations agency tasked with helping countries eliminate poverty and achieve sustainable economic growth and human development.

Link: https://tinyurl.com/y4jss84z

Whistleblowing

Workplace whistleblowing occurs when an individual reports wrongdoing in an organisation, such as financial misconduct, exploitation or discrimination.

https://www.integrityline.com/expertise/blog/what-is-whistleblowing/