ESG is a growing acronym

Kurtanovic, Merisa; Skalonjic, Jasna

مجلة الرسالة للدراسات والبحوث الإنسانية
Volume 9, Numéro 2, Pages 43-54
2024-06-21

Esg Is A Growing Acronym

Authors : Kurtanovic Merisa . Skalonjic Jasna .

Abstract

Abstract The prominence of environmental, social and governance (ESG) factors in finance is increasing, making them an integral part of a company's assessments of sustainability and social impact. This paper looks at the evolution of ESG from a peripheral concern to a central element in financial narratives, highlighting its importance for investors and creditors. Integrating ESG factors into financial reports offers a holistic view of a company's value, going beyond traditional financial metrics. This shift underscores the importance of ESG in understanding long-term risks and opportunities that traditional data might obscure. Furthermore, the paper explores the application of international accounting standards in ESG reporting for small and medium-sized enterprises (SMEs). It discusses the benefits and challenges SMEs face in adopting these standards, emphasizing the role of agility and resource allocation. The dynamic relationship between investors and creditors in the context of ESG reporting is also examined, showing how both groups can benefit from a comprehensive understanding of ESG factors. Through detailed analysis and examples, the paper highlights the development of ESG and its critical role in shaping sustainable business practices and informed financial decision-making.