As businesses and investors navigate the rapidly evolving sustainability landscape, understanding key ESG (Environmental, Social, and Governance) terms is more critical than ever. This glossary provides clarity on the concepts driving compliance, strategy, and innovation in 2025.
Whether you're new to ESG or looking to stay updated, these terms will guide your journey toward sustainability excellence.
A framework used to evaluate a company's environmental impact, social responsibility, and governance practices. ESG metrics are vital for assessing sustainability performance and attracting responsible investors.
An EU regulation requiring businesses to disclose detailed sustainability performance data. CSRD expands on the Non-Financial Reporting Directive (NFRD) and aligns with the EU Green Deal. It applies to large companies and, eventually, small and medium enterprises (SMEs).
A principle central to CSRD that requires businesses to assess:
An EU proposal requiring companies to identify, prevent, and address human rights and environmental risks in their operations and supply chains. It complements CSRD by emphasizing accountability.
The process of reducing carbon dioxide emissions across operations and supply chains. Decarbonisation is a key component of achieving net-zero and carbon-neutral goals.
Achieved when a company balances the carbon dioxide it emits with the amount it removes or offsets through initiatives like reforestation or purchasing carbon credits.
A state where a company eliminates as many emissions as it produces across its entire value chain, including Scope 1, 2, and 3 emissions. Unlike carbon neutrality, net-zero focuses on reducing emissions to an absolute minimum.
The EU’s roadmap for sustainability, aiming to make Europe the first climate-neutral continent by 2050. Initiatives include renewable energy expansion, circular economy policies, and biodiversity preservation.
An EU regulation requiring financial market participants to disclose how they consider ESG factors in their investment processes. SFDR promotes transparency and prevents greenwashing.
A process of identifying and prioritizing the most significant ESG issues for a business and its stakeholders. Materiality assessments are foundational for meeting CSRD and other reporting requirements.
Seventeen global goals established by the UN to address urgent environmental, social, and economic challenges, such as poverty, climate change, and inequality. Companies use the SDGs as benchmarks for sustainability efforts.
The total greenhouse gas emissions caused by a company, individual, or product, measured in CO2 equivalents. Carbon footprint calculations inform sustainability strategies and reporting.
An economic model focused on eliminating waste and maximizing resource efficiency by reusing, repairing, and recycling materials.
Future Planet is the platform that accelerates your ESG performance. From Double Materiality Assessments to CSRD, to carbon accounting and transition planning, Future Planet accelerates impact and compliance.
Future Planet centralises data collection and ensures accuracy for Scope 1, 2, and 3 emissions reporting.
Dynamic tools pinpoint critical ESG issues, ensuring compliance with double materiality requirements.
Future Planet’s software creates reports aligned with CSRD, SFDR, and other global standards, saving time and reducing complexity.
Mastering these ESG terms equips businesses and investors to lead in sustainability. With compliance frameworks like CSRD driving accountability, staying informed is essential.
Future Planet simplifies your ESG journey with cutting-edge tools for reporting and strategy. For more information on how to prepare for CSRD, contact our team at Future Planet today.