Role of ESG in building enterprise value
Journal Title: International Journal of Contemporary Management - Year 2011, Vol 10, Issue 4
Abstract
.Changes in the natural environment and environmentally friendly legislation, the slumps of the financial markets associated with falling confidence in financial assets as well as a variety of risks associated with economic activity, quite seriously alter the conditions for conducting business. Increasingly there was the loss of confidence in the traditional evaluation of the activities of companies mainly based on the financial data. Gaining in the importance non-financial data and investors are consequently examining the environmental and social reports with the results of their audits, standards of business management, ratings of responsible companies and stock market indices which include socially responsible companies. Responsible investors who take into account issues of ESG (Environment, Social, Governance) in the process of risk assessment and investment decisions, as well as they integrate these studies to the traditional analysis through their decisions and actions may play a significant role in the evolution of business systems. Their choices increasingly determine the demand for accountability in the operations of companies. The article discusses some aspects of the impact of ESG factors on building enterprise value. Effective management of issues related to the environment, society and corporate governance is in fact a good indicator of the quality of management and the potential growth of the company's value and the attractiveness to investors.
Authors and Affiliations
Beata Domańska-Szaruga
Keywords
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