How does ESG shape a company’s sustainable development strategy?

In the context of a global economy increasingly emphasizing sustainable development, ESG (Environmental – Social – Governance) has become one of the core tools helping businesses not only operate effectively but also reshape their long-term vision.

Whereas sustainability used to be a “nice-to-have” goal, it is now a prerequisite for a business to survive, adapt, and grow.

So, what is the relationship between ESG and a company’s sustainable development strategy? Let IBS help you explore this in the article below.

What is ESG and why has it become a pillar in business strategy?

What is ESG and why has it become a pillar in business strategy? ESG stands for three core elements: Environmental, Social, and Governance. It is not merely a set of reporting criteria, but a framework that helps businesses assess sustainability across all operations.

From resource usage and waste management to employee welfare and governance systems, ESG touches every link in a company’s value chain.

Integrating ESG not only enhances brand credibility but also lays a solid foundation for building and executing a genuine sustainable development strategy.

How does ESG shape a company’s sustainable development strategy?

Long-term orientation based on sustainable values

Rather than focusing solely on short-term profit, ESG encourages businesses to build strategies grounded in long-term core values such as environmental protection, social welfare, and transparent governance. This ensures that the sustainable development strategy creates value not just for the business, but also for the community and environment.

A tool to identify and manage long-term risks

A sustainable development strategy cannot be effective without the capacity to anticipate and respond to risks. ESG helps businesses detect potential risks early—such as climate change, supply chain disruptions, labor conflicts, legal violations, or PR crises.

Once ESG is integrated into operations, companies can identify risks more quickly and build more effective response scenarios. This enables greater stability and resilience in a volatile business environment.

Driving innovation in business models and operations

ESG in business and sustainable strategy often goes hand in hand with operational restructuring. ESG raises essential questions: Is the current production process wasteful? Are the products truly user- and eco-friendly? Are suppliers transparent and ethically compliant?

These questions compel companies to reimagine their operating model.

This may involve transitioning to renewable energy, digitizing processes, developing “green” products, or designing a sustainable supply chain. These are not just responses to ESG standards, but levers for long-term innovation and growth.

Strengthening organizational culture and core values

A sustainable development strategy cannot succeed without a strong cultural and value foundation. ESG provides a framework for fostering transparency, responsibility, equity, and innovation within an organization.

When ESG becomes part of a company’s culture, every decision is no longer short-term, but a step toward a greater goal. This fosters internal cohesion, attracts quality talent, and builds a trustworthy image among investors and customers.

Helping businesses build sustainable stakeholder relationships

A sustainable strategy cannot be built in isolation—it must be aligned with and evaluated by stakeholders such as investors, partners, customers, communities, and regulators.

ESG offers a common language for businesses to engage with all these groups. Through ESG disclosures, companies demonstrate transparency and build trust in their vision and sustainable management capacity.

This enables long-term relationships, attracts quality resources, and strengthens competitive advantage.

Conclusion

ESG is not just a tool to measure sustainability—it is a strategic compass for 21st-century businesses.

From restructuring operations and risk management to innovating business models, cultivating internal culture, and connecting with markets, ESG acts as a “strategic positioning map” guiding businesses in the long run.

ESG in business and the sustainable development strategy are inseparable and must be integrated as a core part of every decision and action plan. Companies that understand, implement, and stay committed to ESG will be those that stand firm and go far in the new era.

Which industries should start with ESG?

ESG is no longer just for large corporations or international investors. In Vietnam, an increasing number of businesses across diverse sectors are realizing that ESG integration is a strategic step to adapt to a new context—where sustainability standards are essential for competitiveness.

The following sectors are considered top priorities for ESG implementation, not just due to market pressure, but as opportunities to restructure, enhance credibility, and expand market share:

• Manufacturing and Export: Especially sensitive to regulations on emissions, traceability, labor conditions, and social responsibility from global partners.
• Construction, Real Estate, Infrastructure, and Energy: Frequently face environmental concerns, resource consumption, and transparency requirements in management.
• Finance, Banking, Insurance, and Investment: Increasingly use ESG as criteria for risk assessment, partner selection, and capital allocation.
• Technology, Digital Startups, E-Commerce: Need ESG for data governance, AI ethics, user security, and social responsibility in digital environments.
• Public organizations, social enterprises, nonprofits: Apply ESG to improve transparency, operational efficiency, and collaboration with international development partners.

It’s not just high-pressure industries that need ESG. In reality, any business aiming for sustainable development, transparency, and system professionalization should begin their ESG journey today.

IBS – Supporting businesses in effective ESG implementation

Implementing ESG is a long-term journey that requires the right understanding, proper execution, and the right partner. At IBS – Institute for Business Solutions Training and Consulting, we offer a comprehensive ecosystem of solutions, including:

• Practical training & coaching
• Strategic consulting & team development
• Business matchmaking

IBS is proud to be the exclusive partner of VOS Holdings Ecosystem Co., Ltd., implementing a Greenhouse Gas Inventory training program following ISO 14064-1 standards and building Net-Zero roadmaps for banks and financial institutions in Vietnam.

The program is internationally standardized, adapted to Vietnam’s practical context, and certified by Intertek—a globally recognized inspection and certification organization. The IBS – VOS Holdings – Intertek collaboration affirms IBS’s pioneering role in connecting Vietnamese businesses to international ESG standards and networks.

Contact IBS today for tailored, effective, and sustainable ESG consulting for your business.

IBS – Institute for Business Solutions Training and Consulting Joint Stock Company

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