Sustainability for Companies: ESG Reporting
Consumers and investors no longer expect only financial returns from companies — they expect responsibility toward the environment, employees and the community. ESG (Environmental, Social, Governance) is the measurable framework that captures that expectation.
What is ESG?
ESG is the concept used to assess how meaningfully a company is contributing to sustainability — and through that lens, to evaluate its operations and goals. Investors increasingly use ESG criteria when selecting socially responsible businesses to back.
ESG Criteria
ESG consists of three pillars.
Environmental
How a company manages its energy use and environmental impact. Typical topics:
- Corporate carbon footprint inventory
- Energy efficiency programs
- Waste management
- Climate change adaptation projects
Social
How a company treats its employees and stakeholders:
- Human rights and ethical values
- Gender equality
- Employee data security and health
- Employee engagement and labor relations
- Contribution to community well-being
Governance
Corporate transparency, accountability, inclusion and compliance culture. How decisions are made and how relationships with stakeholders are managed.
Corporate Sustainability Reporting
Sustainability reporting is the transparent communication of a company’s performance against ESG criteria. These reports document a company’s commitments, strategy and results in publicly accessible form.
On 10 November 2022, the European Parliament adopted the Corporate Sustainability Reporting Directive (CSRD), requiring companies to disclose their societal and environmental impact at regular intervals.
ESG as a Legal Requirement
Corporate Governance Communiqué. In Türkiye, publicly traded companies must — under the “comply or explain” principle — disclose in their annual report how they apply sustainability principles.
German Supply Chain Compliance Act. Suppliers to large German companies are required to comply with ESG criteria. German companies now use ESG as a decisive factor when selecting suppliers and maintaining existing supplier relationships.
CSRD. Non-EU companies with revenue above EUR 150 million are also being brought within the scope of CSRD. The directive makes sustainability reporting mandatory — explicitly to prevent greenwashing.
Greenwashing
Presenting a product, brand or institution as environmentally responsible — and supporting that presentation with misleading or unsubstantiated environmental claims — is defined as greenwashing. The CSRD and similar regulations are designed to bring this practice under control.
Conclusion
Compliance with ESG criteria is no longer just a commercial advantage; it is increasingly a legal requirement. Integrating sustainability into a company’s long-term strategy is critical for meeting investor, customer and regulator expectations in parallel.