# ESG

*Professional & Ethics — Finicade finance glossary*

ESG means judging investments on environmental, social and governance factors alongside financial ones. Environmental covers emissions and resource use, social covers workers, customers and communities, governance covers board structure, pay and shareholder rights. Supporters argue these are simply risks that show up late in the accounts — a lawsuit, a stranded asset, a fraud. Critics point out that ratings disagree wildly with each other, and that a label is easier to buy than a change in behaviour.

**Related terms:** [Agency Problem](https://finicade.com/glossary/agency-problem), [Corporate Governance](https://finicade.com/glossary/corporate-governance), [Fiduciary Duty](https://finicade.com/glossary/fiduciary-duty)

**Taught in:** Charter Climb — Corporate Structures & Governance

Source: https://finicade.com/glossary/esg