What is ESG, and Why is it Important for your Business?


what is ESG

Environmental, Social and Governance, commonly referred to as ESG is a holistic framework for sustainability management, ethical practices, and conscious consumerism. ESG is increasingly seen as a way of distinguishing from competitor businesses or brands and achieving widespread popularity in the business world. With this growing importance it is essential to know what ESG means to your customers and the responsibilities your business had to support positive change, being compliant, competitive, supporting change, minimise potential risks and move proactively towards a more sustainable future.

Recognising that there is no universal categorisation for ESG factors, and that definitions or areas of focus vary depending on the category or industry all businesses can drive positive outcomes. In the context of the food industry, packaging, energy and reducing food waste are common areas to address first underpinned by social responsibilities. Understanding the ESG impact along the entire value chain, from suppliers right to consumers would be regarded as best practice. ESG targets are measured using both qualitative and quantitative metrics and allow for the business to track their ESG improvements over time. For example, when reporting on their environmental impact, a business’s “water usage in metric litres” helps quantify their impact in a way that is easy to communicate and track. Progress and changes in these metrics over time can also present valuable information to stakeholders, particularly as they continue to seek ethical and transparent behaviour from corporations.

Customers are recognition that the global food industry has an ideal opportunity die to its scale and reach to drive positive outcomes, improved food transparency being used to demonstrate improvements to consumers increasingly concerned about the environmental impact of their food choices. Incorporating sustainable practices throughout your supply chain focusing on areas such as reducing food waste, implementing efficient packaging solutions, sourcing local or organic ingredients and minimising energy consumption, you show consumers that you are making steps in the right direction. Communicate these efforts transparently with your customers, highlighting the positive environmental impact of your products whilst ensuring a robust and auditable trail to build confidence and demonstrate compliance. It is essential that there is proof to back your ESG claims to avoid “greenwashing” or deception.

ESG, in addition to focussing on the environment, encompasses considerations for social responsibility. Consumers appreciate or trust companies that prioritise social responsibility, ensure fair and ethical labour practices within their responsible sourcing strategies are looked upon favourably. Your business should have robust and concise processes and procedures to help ensure consistency in your commitment for ethical labour, diversity, inclusion, safety, and support. For the food industry, this can also involve considering the health and well-being of your consumers by offering nutritious and responsibly sourced food options.

Ensure that your business is providing clear and accurate nutritional information that helps your customers make informed decisions. Emphasise the use of natural ingredients, free from harmful additives, dietary preferences and restrictions, but ensure that these are not deceptive.

To help validify your claims and to further avoid greenwashing, communicate your ESG claims with certifications and commitments. Clearly communicate your sustainability initiatives, certifications (such as organic, fair trade, or animal welfare) and any third-party verification. Utilise various communication channels, such as packaging, websites, social media and marketing campaigns to help educate and engage your consumers on your ESG efforts.

Remember though that a customer focused ESG strategy goes beyond simply promoting your sustainability initiatives; it involves integrating sustainable thinking and ESG principles into your entire business model and fostering a genuine connection with your consumers based on shared values, responsible choices and accountability. In addition to winning consumers, increasing data is showing that an effective and well communicated ESG strategy is important to attracting and retaining the right talent to grow your business.

Prof. Consulting Group

Prof. Consulting Group will help lead your business to success in the Australian food industry with its team of industry-leading experts and extensive range of services. For more information or to discuss how Prof. Consulting Group can support your business, please visit