ESG, CSR & Sustainability: What the Terms Really Mean

Sustainability, ESG and CSR are terms sometimes used interchangeably despite having different meanings. 

While sustainability is a relatively catch-all term, the others refer to specific parts of the sustainability landscape in business. 

What does CSR mean?

CSR, or corporate social responsibility, is a company’s voluntary commitment to act ethically and contribute to society beyond legal compliance.

It can include both environmental and social initiatives to expand on legal compliance. 

This could include community programmes, employee volunteering or local environment programmes. 

It can be used to express a company’s values and build trust with stakeholders and, while it can support more concrete ESG metrics, is not the same thing.

CSR is usually a component of sustainability strategies as opposed to a full plan.

Samsung’s CSR initiatives include Solve for Tomorrow, a STEM-based social innovation programme that encourages public school students to develop solutions for local and global challenges. 

In Brazil, students created a filter to protect health from the disposal of manipueira, a toxic liquid resulting from the production of cassava flour.

“It’s essential to recognise the incredible value teachers bring to innovation, and how education becomes richer and purposeful for the students,” said Helvio Kanamaru, Samsung Latin America’s Director of ESG and Corporate Citizenship. 

“Solve for Tomorrow helps unlock that potential and provides voice to students from so many different communities.”

What does ESG mean?

ESG, or environmental, social and governance, reframes responsibility as measurable risk and opportunity.

This is usually shaped by external expectations, such as those from investors and lenders. 

Metrics like energy use, emissions, labour practices and supply chain due diligence can be considerations that fall under ESG. 

Often, companies are judged against sector-specific standards, ratings and regulation. 

For example, MSCI ESG Ratings rate companies from AAA to CCC relative to sector peers focussed on financially material ESG risks and how well a company manages them. 

S&P Global Corporate Sustainability Assessment produces a zero to 100 score across industry-specific criteria. 

These ratings support inclusion in the Dow Jones Sustainability Indices and provide detailed question-level benchmarking.

Moody’s ESG Solutions provide thematic and overall ESG scores on a zero to 100 scale and are common in fixed income and sovereign analyses.

What does sustainability mean?

Sustainability in businesses goes beyond CSR and ESG, incorporating strategies like science-based targets and transition plans. 

Businesses incorporating sustainability have the ambition to operate within environmental and social limits while creating long-term value. 

While sometimes led by a Chief Sustainability Officer, sustainability does not sit in one single department.

It cuts across entire businesses, from products to operations and supply chains. 

While CSR and ESG manage specific opportunities, sustainability incorporates both of these and looks to design businesses for long-term resilience and impact.

Amazon has co-founded The Climate Pledge to support its sustainability work, and within this it has committed to reaching net zero carbon emissions across its global operations by 2040. 

Since its launch in 2019, Amazon has improved its carbon intensity by 40%, reached its goal to match 100% of the electricity it uses across its operations with renewable energy early and deployed more than 31,400 electric delivery vehicles globally.

“When it comes to decarbonisation, no company can go at it alone,” said Sally Fouts, Director of The Climate Pledge at Amazon, on LinkedIn.

“That's exactly why collaboration and partnership are so integral to The Climate Pledge. It’s about bringing businesses together to find solutions to shared problems.”