Sustainability refers to the environment, social, and governance (ESG) aspects of the company. A companys social aspects include donation to hospitals, colleges, community programs, and charities. Environmental aspects include programs to reduce pollution, increase use of sustainable materials, and support green activities. Governance aspects include social responsibility programs, community relation, product safety, and improving worker conditions.

The Sustainability Accounting Standards Board (SASB) is a non-profit entity engaged in creating and disseminating sustainability accounting standards for use by companies. Sustainability accounting standards are intended to complement financial accounting standards. The standards developed by SASB has been adopted in many countries. However, many countries have implemented its own criteria to encourage public company to disclose their ESG activities.

Apple focuses on sustainability. The company announces 100 percent clean energy power at its global facilities as a part of its commitment to combat climate change and contribute to better environment. Since 2014, all of Apples data center have been with 100 percent renewable energy allowing a chance to reduced greenhouse gas emissions (CO2e) by 54 percent from its facilities worldwide.

Please give your comments on:

1. How sustainability or ESG activities creates value to the firm?

2. How sustainability standard encourages firms to engage in ESG activities?

3. Is there any good example of ESG program that you have seen or experienced?