January 24, 2024

Implementing An ESG Framework | Best Practices Revealed 

In 2021, Microsoft pledged to be carbon-negative by 2030, showcasing the power of an effective ESG framework. This bold step shows how powerful and important it is for companies to focus on ESG. By doing this, Microsoft not only helps the planet. It also strengthens its business in the long run. Nowadays, companies must be aware of how they affect the environment and society. Organizations should use ESG principles for their long-term success.

This guide will make it easy to understand how to use ESG in your business. It includes how ESG fits with your company's values. Let's explore how you can help your company and the environment to grow together. 

Understanding the ESG Framework

Having an ESG framework is essential for businesses today. It's about balancing growth with taking care of social and environmental issues. A good ESG strategy helps reduce risks and improve your brand. It also attracts people who care about the environment and build an ethical business.

Environmental Criteria

This part of ESG looks at how a company takes care of the environment. This includes using energy, managing waste, and saving resources. The goal is to lessen the negative effects on the environment and promote a culture of sustainability. It's about using renewable energy and following sustainable practices. And also to aim for Net zero carbon emission in the supply chain. 

Social Criteria

This area is about how a company interacts with people like its employees, suppliers, customers, and local communities. It focuses on fair work practices. It welcomes diversity in the work community. It's not just about following laws, it's about creating a good workplace and helping the communities where the company operates. Companies that focus on these things can build a sustainable and ethical model that's good for both profits and society.

Governance Criteria 

This is about the rules and practices that guide a company's leadership and decisions. Think of it as the ethical mindset of the company, directing how it's run and managed. This includes how the company is managed, ethics, executive pay, and respecting shareholder rights. It's about doing business in an accountable and transparent way. 

A well-known example of corporate governance criteria is when Tesla's CEO, Elon Musk, tweeted about taking Tesla private in 2018. This caused a lot of issues, showing the importance of clear and responsible communication and governance.

Implementing the ESG Framework

Assess Current Status: Begin by looking at your current ESG practices. Identify your strengths and areas for improvement. The goal is to meet ESG sustainability standards and make plans to improve weaker areas.

Set Clear, Achievable Goals: After evaluating your ESG practices, set SMART(specific, measurable, achievable, relevant, and time-bound ) goals. This helps set clear, attainable targets. It also makes significant improvements in your ESG performance.

Develop a Comprehensive Strategy: Create a strategy that includes ESG in all parts of your business. This means integrating ESG issues into every corporate decision and action.

Implement Policies and Practices: Put in place policies that support your ESG goals. For example, use renewable energy and improve diversity.

Monitor and Report Progress: Check on and share updates about your ESG efforts. This shows you're committed and keeps you accountable.

Continuous Improvement: Remember, ESG is an ongoing process. Keep assessing and improving your ESG strategies to stay relevant and effective.

Real-Life Examples of ESG Frameworks

IKEA's Environmental Initiatives: IKEA has started doing several things to help the environment. They are using renewable energy sources, such as solar or wind power, to spend money on energy. They are also working on projects that help forests grow and are trying to deliver their products to homes without causing any pollution. They are aiming to go forest-positive and this effort to lessen their harm to the environment is a great example for other stores to follow.

Google has made big efforts to include a variety of people in their workforce. They also aim to be more involved in the community. They are also helping with education and teaching people about technology. This shows Google's commitment to being responsible and helpful in society.

Why ESG Framework Matters?

Implementing an ESG framework is important because it:

  • Enhances risk management.
  • Promotes long-term sustainability.
  • Improves stakeholder trust and relationships.
  • Aligns with global sustainability goals.
  • Boosts company resilience and ethical standards.
  • Protects against reputational damage.
  • Encourages proactive governance strategies.
  • Benefits the environment and society.
  • Drives responsible investment decisions.
  • Supports regulatory compliance and transparency.

Navigating Challenges in ESG Implementation

Even though ESG is good for businesses, putting it into practice can be tough, especially in the following areas:

Resource Allocation: For small companies, deciding how to use their money and people is a big challenge. They need to make sure every part of the company gets enough support without using too many resources.

Data Management: It's important to handle information well when working with ESG. Companies need good ESG reporting software to collect, analyze, and store the right data. The tough part is bringing together different kinds of data and making sure it's accurate and useful for making decisions.

Stakeholder alignment: It means understanding the needs and desires of various groups involved with the company. These groups include investors, workers, customers, and the local community. It's crucial to communicate well to address everyone's views. The aim is to find common goals that match the company's mission and values.


Implementing an ESG framework is no longer an option but a necessity for businesses aspiring to thrive in the modern world. It requires commitment, strategic planning, and continuous improvement. By adopting best practices in ESG, companies contribute to the world and pave the way for sustainable business success. The business world is evolving. Those who incorporate ESG into their core operations are likely to lead the way in innovation, profitability, and making a positive social impact.

But how can businesses make this happen more easily? That's where Breathe ESG comes in. It is like a helping hand for businesses to meet their ESG goals. It simplifies the whole process, making it easier for companies to track how they're doing on environmental, social, and governance issues. With the help of ESG software companies can make smart decisions that not only benefit their business but also the world around them. So, embracing Breathe ESG is a smart move for any business wanting to lead in innovation, profits, and positive social change.