Clean Energy News

Apr 23, 2024

How ESG Goals can be met with Solar

July 6, 2022

Category: news

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In 2021, ESG (Environmental, Social, and Governance) goals increased among companies due to demand from investors, consumers, and policy makers. According to the MSCI World ESG Leaders Index, in 2021, stocks for companies among the MSCI World ESG Leaders Index rose by 22% compared to 15% for companies who are not among ESG leaders. Similarly, according to the Sustainable Investments Institute, support for social and environmental proposals among shareholders increased from 27% to 32% in the past year. According to Peter Novelli Media Company, 80% of Americans believe companies have a responsibility to help solve the climate crisis and 75% of Americans have a more positive image of companies that prioritize climate action. As ESG goals continue to expand, companies must find ways to achieve these goals.

ESG goals include Environmental, Social, and Governance components that are important to maintain a set of company standards for employees, investors, and consumers. As defined by the CFA Institute, Environmental goals pertain to the conservation of the natural world including: climate change and carbon emissions, air and water pollution, energy efficiency, biodiversity, deforestation, water scarcity, and waste management. Social goals pertain to the consideration of people and relationships including: customer satisfaction, data protection and privacy, gender and diversity, employee engagement, community relations, human rights, and labor standards. Governance pertains to standards for running a company including: board composition, audit committee structure, bribery and corruption, executive compensation, lobbying, and political contributions.

Solar and clean energy systems allow companies to meet their ESG goals. Primarily, implementing solar allows companies to reduce their greenhouse gas emissions while saving money on energy and utility costs. In 2020, the International Energy Agency reported that œsolar power is now the cheapest electricity in history. This is due to a combination of factors including increasing fossil fuel and utility costs and the decreasing cost of renewable energy technology. Implementing solar has a variety of local, state, and federal tax incentives that will help maximize ROI. Taking steps such as implementing solar to meet ESG goals demonstrates transparency to shareholders, customers, and the community. As researched by Peter Novelli Media Company, 75% of Americans want to hear more from companies about what they are doing to help solve the climate crisis and 71% of Americans are more likely to buy from a company that does a better job at discussing how they are helping solve the climate crisis. Implementing solar does not only help companies meet ESG goals, but it also saves money and improves customer satisfaction.

Implementing solar can help companies meet ESG and sustainability goals. As ESG goals continue to expand, a variety of steps will need to be taken in order to achieve those goals. Solar is an important step in a clean energy future.

 

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