The global ESG movement can be traced back to the Paris Conference on 15 December 2015. Amidst all the growing endorsement on ESG from companies all over the world over the last 9 years, however, some issues have emerged, with one being the confusion over what the term ESG means in practice, and the murkiness of the terms has given rise to concerns that ESG may “come to mean everything and nothing.” Indeed, in the US, the ESG has been labelled by some as “woke” capitalism and accused of enabling greenwashing.

Our proposal, in a nutshell, is an attempt to provide a more refined definition of ESG so as to address such issue and for helping to ensure that the energy and resources spent on ESG by companies in the world can get the desired results. We think ESG movement is symptomatic of growing public expectations around corporate responsibility which we see as fair and legitimate and is a global trend that would be here to stay.

As such, we propose to offer a more refined elaborations on what ESG means in practice, which shall revolve around 3 sub-categories underneath each of E, S, and G. As such, for E, we shall refer to green assets; green operations and green innovations. For S, we shall refer to social enjoyment; social investment; and social enlightenment. And for G, we shall refer to governance to all shareholders; governance to all staff; and governance to the industry globally.  

The above elaborations are derived from the Firm/ Market paradigm inspired by 1991 Nobel Laureaute Ronald Coase and the thoughts of Adam Smith. It is also important to note that, seen in this light, these 9 sub-categories as a whole actually would bring us to a philosophical conceptualisation of ESG and throw light on what are meant by ESG – Economically, Socially and Globally Responsible- companies – by doing well and striving to improve in these 9 sub-categories, companies shall become what we see as ESG Responsible companies.