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Driving Sustainability: Industries Pioneer ESG Integration for a Greener Future

The need for convergence of technology with the environment has led to the formation of Environmental, Social, and Governance (ESG) strategies across industries worldwide for decarbonization.

ESG principles pave the way for environmentally friendly practices, social reforms, and governance criteria, which are critical for company scores today, as new investments depend on these responsibility metrics and standards.

As the world gears up for sustainability, ESG measures a company’s efforts to lower pollution, reduce carbon footprints, and minimize waste. Social measures focus on having a diverse and inclusive workforce at all levels, attracting potential investors.

Avendus Capital notes, “ESG-focused companies continue to outperform their non-ESG counterparts and anticipate more ESG-focused investment flows into the country. ESG-focused equity funds in India have grown from $330 million in 2019 to $1.3 billion in June 2023,” according to the Economic Times.

The European Securities and Markets Authority (ESMA) states that at least 80% of ESG-labeled funds should be invested in assets related to environmental, social, or governance goals, excluding the largest oil and gas producers.

Lenders are increasingly offering loans only to those fulfilling ESG purposes.

Sectors Adopting Sustainable Practices

A) Clothing

Massive clothing waste can be mitigated by organic clothing.

  • Organic clothing adheres to agricultural standards and uses materials like wool, silk, cotton, jute, linen, and ramie. Natural fibers are gentle on the skin and suitable for those with skin conditions like eczema.
  • Synthetic fibers take around 200 years to decompose, whereas organic cotton decomposes within 1 to 5 weeks. Synthetic production releases harmful chemicals into the environment.
  • The Global Organic Textile Standard (GOTS) certification tags fibers as organic, ensuring sustainability standards. However, Indian cotton has struggled to meet these standards, and many consumers are unaware of the benefits of organic textiles.

B) Cement

India is the second-largest producer of cement, after China. The production process is hazardous, emitting significant carbon dioxide and releasing harmful particles.

  • ESG measures are vital to reduce the carbon footprint. Green cement, produced through a carbon-negative process, is a significant advancement.
  • JSW Cement’s Ground Granulated Blast Furnace Slag (GGBS) in Portland Slag Cement (PSC) reduces carbon emissions by 12-15%.
  • Ultratech’s Greenvantage is an eco-friendly cement product, though sustainable practices in cement production remain underutilized in India due to lack of awareness and cost concerns.

C) Sugar

Sugar production poses environmental challenges.

  • Sugar mills produce wastewater, emissions, and solid waste that harm ecosystems, as per WWF reports.
  • The Bonsucro initiative aims to make sugar production eco-friendly by adhering to sustainable criteria.
  • WWF’s commitment to Bonsucro-certified sugar is yielding results, with certified sugarcane from Brazil being purchased by The Coca-Cola Company. In India, 5,000 smallholder farmers have received Bonsucro certification, making the country the world’s second-largest sugarcane producer.

Global ESG Scaling

  • The European Securities Markets Authority (ESMA) monitors transparency in ESG-related data among businesses operating in Europe, ensuring compliance among suppliers.
  • Countries like the UK, Singapore, Japan, and India have introduced principles and non-negotiable guidelines for ESG raters.

ESG-Related Crime

  • Greenwashing involves misleading consumers with false ESG labels or data.
  • Tech-related ESG fraud incidents, such as Facebook’s data privacy breach in 2018, highlight the importance of governance in protecting personal data.

By prioritizing ESG strategies, industries can drive sustainable growth and meet evolving investor expectations, paving the way for a greener and more socially responsible future.

Aishwarya Singh is a journalist who is a passionate lifelong learner. She has worked with India’s reputed news agencies. Now, with 3+ years of curating, copy editing, and proofreading experience, she wants to contribute to making a thriving society by exploring unattended areas related to the environment and civic issues.

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