What is ESG

ESG (Environment, Society, Government): These are criteria – indicators related to environmental, social, and corporate governance issues that can affect a company’s ability to generate value in the long term. There are corresponding reference frameworks such as the IAS and IFRS in the accounting and auditing field for the observance and issuance of indicators such as the GRI.

The indicators represent the ethical and sustainable impact of investments regarding a business in the three aspects they represent.


In 2022, the Athens Stock Exchange issued an updated ESG disclosure guide (the first was issued in 2019) for stock market companies that aligns with major global reference frameworks, such as the Sustainability Accounting Standards Board (SASB), which identifies ESG issues that are financially essential to each industry, and maps the proposed indicators against reference frameworks such as the Global Reporting Initiative (GRI), the Carbon Disclosure Project (CDP) and the EU Directive on the publication of non-financial information.

Why to adopt ESG

1. Strong relationship between the performance of ESG indicators and the financial performance of companies.

2. ESG data, combined with financial data, allow investors to gain a comprehensive picture of each company, to understand its competitive position and the efficiency with which it can exploit new opportunities.


3. By adopting ESG, the Non-Financial Reporting Directive (NFRD) 2014/95/EU, the European Classification System for Environmentally Sustainable Economic Activities (EU Taxonomy) and the upcoming Corporate Sustainability Information Disclosure Directive (CSRD) are adopted.

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They said on ESG

  • PwC: Banks and investors will periodically increase their ESG requests. We believe that relevant ESG requirements will evolve in 3 phases. We are now in Phase
  • KPMG: Stakeholders – from regulators and investors to customers and the public – are putting your ESG metrics and disclosures under increasing scrutiny. They want access to credible, verifiable, and comparable ESG metrics so that they can make decisions on areas that matter most to them.
  • AICPA & CIMA: Τhe demand by investors, regulators, and other users (stakeholders) for information about the effects of ESG-related matters on entities and their financial reporting has grown dramatically. At the same time, management is seeing the benefits of focusing on and communicating information about the risks posed by ESG-related matters as well as management’s activities and plans for addressing them.

The future

From 2024 all listed companies in the EU area, all their suppliers and SMEs (in a more flexible framework) are required to issue an ESG report and certify their results. Now it seems that the certification control process will be undertaken by auditing companies (KPMG, Deloitte, PwC etc.) and the certification will be given by rating agencies such as MSCI respectively with the companies’ credit rating agencies.

However, there is still no legal framework and limitation on who applies the procedures to companies to have ESG indicators. Greek listed companies that already implement ESG have created a separate department or appointed a C-suite manager (usually the one who already had CSR under his/her responsibility) for this project. For this purpose, they attend specific seminars [IASE (ISB certification), CFA Institute (Certificate in ESG Investing) and others] to gain expertise.


ESG will also be mandatory for all European banks to finance companies. This means that even small businesses will be required to adhere to ESG standards to issue indicators that they will disclose to banks to receive funding from financial institutions.