ESG 1

TITLE
NAME
INSTITUTION
 ESG 2

Abstract
ESG stands for environmental, social, and governance it shows how a company or an
organization is treating the environment, its people, and the financial status. It is also known as
sustainable and investing ESG has reached a global level and many companies use this method
to know their financial status. This paper discusses the features of ESG taking Starbucks as an
example.
 ESG 3

Environmental, Social, and Governance

The main factor of ESG is how a company protects and safeguards the environment,

addressing climate change. Social principle shows how it operates the relationships with

employees, communities, and customers. The governance principle shows the company’s

leadership, internal controls, audits, and shareholder rights. Recently ESG investors are

increasing rapidly. With the help of ESG investors ensures the company they invest is

responsible towards the environment, their citizens, and the financial management.

Features of ESG

Environmental issues like corporate climate policies, energy use, pollution, waste,

natural resource conversion, and treatment of animals. ESG considerations also help to evaluate

any environmental risks a company might face and how they manage taking those risks.

Considerations may include toxic wastage and greenhouse emissions. Human influence should

be considered because of the pollution they produce and making climate disruption.

Social factors show the ethical values of a company, and how an organization treats its

employees, customers, and suppliers. Respect human rights by preventing child and forced labor.

Respect the rights of the workers and provide them safe and healthy workplace. Building trust

with customers is their main goal. Giving data protection and privacy to their customers.

Improve employee skills and knowledge which include internal and external training and courses

offered by the company.

Governance aspects like conducting business and always establishing partnerships in an

ethical manner. Conducting annual audits and transparent disclosure of companies’ portfolios
 ESG 4

and financial statements. Governance includes companies’ leadership, tax strategy, internal

controls, Donations and board composition.

Starbucks is an great example of ESG, it took responsibilities in all the major factors.

They have been using renewable energy in US and Canada. It supports the environment by

reducing carbon emissions, water usage, and recycling waste. Their efforts of reducing single-

use plastic by producing reusable cups. They offer discounts for those who bring their own cup.

Starbucks helps its farmers by increasing the productivity, and quality of life that support both

planet and people. They also operate a global farmer fund, farmer support center, and childcare

center. Starbucks has achieved 100% pay equity for men and women and people of all races.

They even hire veterans and military families and self-identified refugees in US and Canada.

Starbucks has been showing ethical responsibility towards their employees by supporting their

employees in all different formats. Starbucks even participates in animal welfare, cage-free eggs,

antibiotics, and sow housing. Starbucks provided one million cups of coffee to the front-line

responders supporting health care. The governance at Starbucks believes in strong corporate

governance is the foundation of financial integrity. Board is responsible for the ESG risks and

opportunities for a long-term strategy.

The ESG creates good opportunities for investors and gives better identification and

manages risks. has also some downsides companies can get a passing grade even when their

policies disagree. ESG ratings are not based on the company benefits but they are based on the

policies that boost the company profits. Research can be higher in cost and can lead to less

diversification.
 ESG 5

Reference(s)

Dierk-Oliver Kiehne. (2019). ESG- An Overview.

https://www.researchgate.net/publication/

334398123_Environmental_social_and_corporate_governance_ESG_-

also_an_innovation_driver