What is ESG?
ESG stands for Environmental, Social, and Governance. These three aspects are considered essential pillars that companies should report on. The primary goal of ESG is to understand all non-financial risks and opportunities inherent in a company’s daily activities.
Why is ESG Important?
Today, the world faces various global challenges such as climate change, the transition from a linear to a circular economy, increasing social inequality, and the need to balance economic needs with societal needs. Investors, regulators, consumers, and employees increasingly demand that companies not only be good stewards of capital but also of the environment, social aspects, and governance frameworks necessary to support these areas. The better the implementation of ESG, the greater the benefits and the better the perception of the company in the eyes of the public, government, and investors.
Environmental Pillar
Under the Environmental Pillar, companies report emissions such as greenhouse gases and air, water, and soil pollution. Resource use is also a focus, such as whether a company uses new or recycled raw materials in its production process and how the company ensures that from start to finish, the materials in its products are returned to the economy rather than ending up in landfills.
Companies are also expected to manage water use efficiently and pay attention to land use, such as deforestation and biodiversity. Reports on the positive sustainability impacts a company might have are also included in this pillar.
Social Pillar
The Social Pillar covers how companies manage employee development and labor practices. They also report on product responsibility related to product safety and quality. Standards for supply chain health and safety, as well as issues of controversial resource sourcing, are included in this pillar.
The role of the company in the well-being of the surrounding community is also important and should be reported. Companies are expected to report how they provide access to their products and services to underprivileged social groups.
Governance Pillar
Key issues to be addressed and reported under the Governance Pillar include shareholder rights, board diversity, executive compensation alignment with the company’s sustainability performance, and corporate behavior such as anti-competitive practices and corruption.
Additionally, how the company interacts with the media, government, and communities should be planned, executed, and reported as part of corporate governance.
Regal Springs Indonesia and ESG Implementation
Regal Springs Indonesia is a real example of a company successfully implementing ESG principles in its operations. Founded on the basic principle of “doing well by doing good,” Regal Springs is committed to maintaining sustainable and responsible practices throughout its supply chain.
Regal Springs Indonesia and the Environmental Pillar
Regal Springs Indonesia demonstrates its commitment to the environment by regularly monitoring water quality, measuring more than 20 water quality parameters such as water temperature, DO, pH, and turbidity. The company also conducts periodic sediment sampling at key locations under the net cages every six months. Additionally, Regal Springs Indonesia has replaced diesel generators with 168 solar panels to provide the necessary electricity for lighting and CCTV. The company is also involved in managing water hyacinth to maintain natural beauty.
Regal Springs Indonesia and the Social Pillar
Regal Springs Indonesia is also active in the social aspect, with various programs supporting local communities. Educational programs provide rewards to 237 students in 12 different schools across six districts with school equipment packages. The company also provides basic necessities to 35 honorary teachers twice a year.
Regal Springs Indonesia also empowers local SMEs and provides additional food packages to improve nutrition, supporting 1,631 beneficiaries. Blood donation and free mass circumcision programs, as well as the improvement of health center facilities, are other examples of their social contributions. Additionally, Regal Springs Indonesia runs stunting prevention and nutrition improvement programs.
Regal Springs Indonesia and the Governance Pillar
In terms of governance, Regal Springs Indonesia participates in various stakeholder and media events, such as celebrating National Fish Day 2023 and the Kriya Fest event in North Sumatra. They also participated in the 9th Innovation and Investment Week at Maimun Palace in Medan, North Sumatra, and received an award for the best booth.
Additionally, Regal Springs organizes open chess tournaments and various routine engagements with regulatory stakeholders from central, provincial, and local authorities. They also provide hampers and donations to 12 villages, benefiting more than 1,270 people.
Through these various initiatives, Regal Springs Indonesia not only commits to sustainability but also demonstrates that ESG implementation can bring real benefits to the company and the surrounding community. Consistent ESG implementation enables Regal Springs Indonesia to continue growing and set an example for the aquaculture industry.
