What Is ESG and Why Does It Matter to Corporate Travel Programs?
Travel is a fundamental part of corporate work, allowing companies the possibility of cultivating a national and international network. However, it is crucial to consider the impact of travel and how it can be made more efficient and sustainable. ESG is a methodology for keeping track of issues that matter to investors, including the environmental impact of company travel. Read on to learn more about this important concept and how it can create a more responsible corporation.
What Is ESG?
ESG stands for Environmental, Social and Governance. The term refers to a whole series of non-financial factors that are important to investors. Think of ESG as separate, non-fiscal issues that matter to companies but are still related to their finances. E, or environmental, refers to eco-friendly policies relating to corporate environmental practices. S stands for social, or anything related to social issues and their impact on the workplace. Finally, G refers to governance, or internal policies and legal compliance.
Overall, ESG highlights issues such as sustainability, environmental impact, diversity and inclusivity efforts, along with other concerns. Companies are increasingly paying attention to ESG, especially if they are considering their long-term presence and the impact they might have on the world, both positive and negative.
How Important Is ESG?
There is a general consensus that greater concern for environmental, social and governance issues leads to greater value in corporations. ESG addresses many problems that have received widespread attention and put a spotlight on how corporations can do their part to affect change. Aside from the financial advantages, ESG also encourages companies to invest in issues that matter.
How Does ESG Factor Into Corporate Travel?
ESG is important to keep in mind for corporate travel because business trips by employees can greatly increase the carbon footprint of a company. A crucial way to meet ESG goals is to become more intentional about travel planning, using tools and resources that allow you and your employees to arrange flights as mindfully as possible. For example, we developed a tool to help employees plan their flights and save company funds. This is just one of many ways you can change your process for booking corporate travel to align with your goals.
How Does COVID-19 Impact ESG and Travel?
One of the most recent considerations for investors of any kind is the impact of the COVID-19 pandemic. While there is no sector unaffected by it, few were as impacted as the travel industry. Fluctuations in the pandemic and various airline restrictions are certainly important considerations as you build and refine your corporate travel program.
In many ways, the pandemic permitted companies to see the benefits of the environmental, social and governance paradigm. For example, the option to work from home has allowed companies to reduce each employee’s carbon footprint by eliminating commuting while also reducing the need to rent office spaces.
Rethink Your Travel
Now that you know about the impact of ESG on corporate travel, you can start to make informed decisions about your travel options in alignment with your environmental goals. Try out our platform to streamline your travel program for your employees.
