ESG: what is Environmental, Social and Governance and how does it apply to construction?

An organization’s actions have a direct impact on society, the environment and the way it is managed. It was with the aim of bringing these factors to the center of corporate decisions that the concept of ESG (Environmental, Social and Governance) emerged.

Created in 2004 by the World Bank, in partnership with the UN Global Compact and institutions in nine countries, ESG has gained prominence for helping companies to act in a more sustainable, ethical and responsible way.

But what does ESG mean in practice? And how can its principles be applied to construction sites and projects? That’s what you’ll find out in this article.

What does ESG mean?

ESG stands for Environmental, Social and Governance. The concept involves three fundamental pillars that assess how a company positions itself in relation to the environment, society and its internal governance.

These pillars are broken down into indicators that help measure an organization’s sustainable and ethical performance.

Understand the three pillars of ESG

1. Environmental

This refers to the management of the environmental impacts caused by the company’s activities. The aim is to reduce damage and adopt sustainable practices. It involves issues such as:

• Carbon emissions;
  
• Use of natural resources;
  
• Waste management;
  
• Preservation of biodiversity.
  

2. Social

It assesses the company’s relationship with people, both internal and external. Includes:

• Working conditions;
  
• Inclusion and diversity;
  
• Human rights;
  
• Occupational safety;
  
• Community engagement.
  

3. Governance

It deals with the way the company is run, with a focus on ethics, transparency and corporate responsibility. Some important points are:

• Board structure;
  
• Corruption prevention;
  
• Compliance with laws;
  
• Accountability.
  

How to apply ESG in construction?

In the construction sector, ESG is gaining more and more ground. Incorporating its principles throughout construction work can generate a series of benefits for both the company and society.

Advantages of ESG on construction sites:

• Brand and reputation enhancement in the market;
  
• Easier access to investment, as funds and financiers prioritize companies with ESG practices;
  
• Reduction of legal, environmental and social risks;
  
• Compliance with environmental legislation and certifications;
  
• Better long-term financial performance.
  

The 3 types of sustainability in construction

The application of ESG in construction is directly linked to the adoption of sustainable practices. These can be divided into three types:

1. Environmental sustainability

It focuses on reducing the environmental impact of construction. Examples:

• Use of recyclable and low-impact materials;
  
• Water reuse and rain harvesting;
  
• Energy efficiency (solar energy, natural ventilation);
  
• Correct management of construction waste.
  

2. Social sustainability

It relates to the well-being of the people involved in the work and the impacted communities. Actions include:

• Safe and fair working conditions;
  
• Dialogue with surrounding communities;
  
• Accessible projects;
  
• Valuing the local workforce.
  

3. Economic sustainability

It seeks to guarantee the long-term financial viability of projects. Some strategies:

• Reducing operating costs with sustainable solutions;
  
• Increased durability of buildings;
  
• Real estate appreciation;
  
• Efficient financial planning.
  

ESG in practice: how GEPLAN applies this concept

At GEPLAN, we apply ESG principles in a strategic and integrated way at all stages of construction management. Our commitment is to performance, responsibility and the creation of lasting value.

See how we put ESG into action:

• Environmental: we seek solutions that reduce waste and promote the rational use of natural resources;
  
• Social: we guarantee safe working environments, respect the surrounding communities and promote staff appreciation;
  
• Governance: we act with total transparency, ethics and control over deadlines, costs and technical decisions.
  

More than delivering works, we deliver trust, positive impact and legacy.

ESG is more than a trend: it’s a new way of thinking about business and the construction industry has a key role to play in this transformation. By adopting environmental, social and governance practices, your company can build not only buildings, but also a more sustainable, ethical and valued future in the market.

Do you want to know how GEPLAN can help your construction site follow ESG principles? Contact us and find out more about our construction management model focused on performance and sustainability.