The social pillar in ESG is critical because it both reflects the 'how and why' of a company, and social movements are the only real way to create the positive and lasting change the planet needs Environmental, social and governance (ESG) frameworks are based on the principle that these three factors are critical to a more holistic approach to corporate financial performance. So when companies use ESG, it means they are using these factors � environmental, social and governance � to evaluate how advanced they are with sustainability. The ESG framework can also assess the performance of countries and investments more generally.