THE EVOLUTION OF ESG AND ITS PRACTICE AND DEVELOPMENT IN CHINA

Abstract

Starting from the evolution of Environmental, Social, and Governance (ESG), we attempt to explore the boundary of ESG: what can be done and what cannot be done (limitation), and the influence of ESG classification and evaluation system on economic activities, social development, and ecological environment. Since the abbreviation “ESG” was introduced by the United Nations in 2004, its influence has been growing among businesses worldwide as an important embodiment of the concept of sustainable development. With the development of ESG-related theory, we analyze its application and practice in the industry and its impact on enterprise value management. Especially for investors, ESG can be a new direction for judging corporate performance and investment value. In addition, we analyze China's policy trends in daily consumption and industry, from large to small, give out how to combine ESG with effective corporate governance and explain the positive effects of ESG.