ESG stands for Environmental, Social, Governance. Investors use ESG criteria to evaluate firms for risk and long-term value. Which set of terms correctly represents the ESG meaning?

• A. Economic, Social, Governance
• B. Environmental, Sustainability, Governance
• C. Environmental, Social, Governance
• D. Environmental, Social, Global

Answer: (C)

ESG stands for Environmental, Social, Governance, and it guides investors to assess a company’s risks and long-term value beyond financial numbers. The environmental portion looks at how a company impacts the natural world—things like emissions, energy use, waste, and resource management. The social portion examines relationships with people and communities—employees, customers, suppliers, diversity, and human rights. The governance portion focuses on how the company is run—board structure, independence, executive compensation, transparency, and accountability.

The set that matches these three pillars exactly is Environmental, Social, Governance. The other options swap or change one element: Economic changes the focus away from the environmental aspect, Sustainability uses a different term for governance or long-term planning, and Global uses a geographic descriptor rather than the governance mechanism. So the correct trio is Environmental, Social, Governance.