ANNOUNCEMENTS
Many linked environmental challenges, including pollution of soil, water, and air, global warming, biodiversity loss, and depletion of natural resources, have gotten worse as a result of technological improvements. Many market players, both institutional and private investors, have wanted to incorporate environmental sustainability in the investment strategies since the phrase "sustainable development" was coined. However, attaining sustainable development will be difficult unless there is a boom in Environmental, Social, and Governance (ESG) investment, which is directly linked to sustainability. Analysts have identified three important areas that might have a substantial influence on a company's financial performance. As a result, environmental management methods such as Renewable Energy 100 percent, carbon neutrality, and the circular economy idea are increasingly extensively employed. However, the limited comparability of E (Environmental) scoring as both a tool for greening the financial sector, as well as partial scoring metrics, the grouped nature of diverse environmental factors, various methodologies used by rating providers, and a lack of robust datasets have limited its usefulness. As a result, in order to increase the E pillar's relevance, the E in ESG must consist of a collection of metrics that address various environmental problems, hence preventing future environmental calamities. The key limitations, which must be resolved for the E pillar to become a successful tool for permitting sustainable financing and development, are inconsistencies in the measures' scope and evaluation standards.
Investors wanting to increase long-term value and tend to align with environmental resilience are driving demand for environmental, social, and governance (ESG) investing. To that aim, rating providers and investment funds attempt to incorporate indicators related to environmental performance, climate risk mitigation, and renewable energy plans into their environmental (E) pillar ratings and indexes.
Key words: ESG rating methodology, environment pillar, ESG.
