Environmental, Social and Governance or ESG has made its way from optional assessments and disclosures to those required in corporate sustainability initiatives and a large part of the investment community. Unfortunately, although the term is ubiquitous, there are many definitions of the term ESG. This leads to confusion among companies and the investment community alike.

The Corporate Finance Institute defines ESG as a framework aimed at aiding stakeholders in understanding how an organization manages risks and opportunities associated with environmental, social, and governance criteria. From this point of view, risk management is an important component and goal of any ESG initiative.

This document was prepared for the Open Access Initiative to offer housing practitioners some basic information about how to incorporate ESG into their businesses in a way that attracts and satisfies investors that the overall intentions of the approach have been met. It was originally produced for the African Union for Housing Finance and presented at their conference in Zanzibar, Tanzania, in October 2024.