The sustainability and ESG glossary
CSRD, double materiality, scope 3, EcoVadis medals: the terms you meet in reporting, ratings and customer questionnaires, defined in plain English, with dates and sources.
C
- Carbon and climate
Carbon footprint
Corporate carbon footprint, Bilan Carbone®, BEGESA corporate carbon footprint is the inventory of all the greenhouse gas emissions a company causes over a year, across scopes 1, 2 and 3, expressed in tonnes of CO2 equivalent.
- Carbon and climate
Carbon offsetting
Carbon creditsCarbon offsetting is buying carbon credits, each representing one tonne of CO2 equivalent avoided or removed by a project elsewhere, to balance part of a company's own emissions.
- Regulation
CBAM
Carbon Border Adjustment MechanismThe CBAM (Carbon Border Adjustment Mechanism, Regulation (EU) 2023/956) puts a carbon price on certain goods imported into the EU, equivalent to what EU producers pay under the EU Emissions Trading System.
- Ratings and standards
CDP
Formerly Carbon Disclosure ProjectCDP is a non-profit that runs the global environmental disclosure system. Companies answer a questionnaire on climate change, water security and forests, and receive a score from A to D-, or F if they were asked and did not respond.
- Carbon and climate
Climate transition plan
A climate transition plan sets out how a company will cut its greenhouse gas emissions in line with its climate targets: the targets, the decarbonization levers, the investments, the timeline and who is accountable.
- Regulation
CSDDD
Corporate Sustainability Due Diligence DirectiveThe CSDDD (Corporate Sustainability Due Diligence Directive, Directive (EU) 2024/1760) requires very large companies to identify, prevent and address human rights and environmental harms in their own operations and their chain of activities. Since Omnibus I, it covers companies with more than 5,000 employees and more than €1.5 billion in net turnover.
- Concepts
CSR
Corporate social responsibilityCorporate social responsibility (CSR) is a company's responsibility for its impacts on people and the environment, and the way it manages those impacts across its operations and value chain.
- Regulation
CSRD
Corporate Sustainability Reporting DirectiveThe CSRD (Corporate Sustainability Reporting Directive, Directive (EU) 2022/2464) requires large companies to publish an audited sustainability report under the ESRS. Since the Omnibus I directive of 2026, it covers companies with more than 1,000 employees and more than €450 million in net turnover.
D
- Reporting
Double materiality
Double materiality is the principle that a sustainability topic is material if it matters from either of two angles: the company's impact on people and the environment (impact materiality), or the topic's financial effect on the company (financial materiality).
- Regulation
Duty of vigilance
French Duty of Vigilance Law (2017)The French Duty of Vigilance Law (Law No. 2017-399 of March 27, 2017) requires large French companies to publish and implement a vigilance plan covering human rights, health and safety, and environmental risks in their group, their suppliers and their subcontractors.
E
- Ratings and standards
EcoVadis
EcoVadis is a sustainability rating platform that scores companies from 0 to 100 on four themes: environment, labor and human rights, ethics, and sustainable procurement. Companies usually get rated because a customer asks for it.
- Ratings and standards
EcoVadis medals
EcoVadis medals (platinum, gold, silver, bronze) go to the top 1%, 5%, 15% and 35% of companies rated by EcoVadis. EcoVadis publishes percentiles, not score thresholds, so the score needed for a medal moves over time.
- Carbon and climate
Emission factor
An emission factor converts an activity into greenhouse gas emissions: kilograms of CO2 equivalent per kilowatt-hour, per kilometer, per tonne of material or per euro spent. Activity data multiplied by the emission factor gives the emissions.
- Concepts
ESG
Environmental, social and governanceESG stands for environmental, social and governance: the three families of criteria investors, lenders, rating agencies and customers use to assess a company's sustainability performance and risks.
- Reporting
ESRS
European Sustainability Reporting StandardsThe ESRS (European Sustainability Reporting Standards) are the reporting standards companies subject to the CSRD must follow. They were developed by EFRAG and adopted by the European Commission as a delegated act.
- Regulation
EU Taxonomy
The EU Taxonomy (Regulation (EU) 2020/852) is the EU's classification system that defines which economic activities count as environmentally sustainable, so that companies and investors use the same definition.
- Regulation
EUDR
EU Deforestation RegulationThe EUDR (EU Deforestation Regulation, Regulation (EU) 2023/1115) bans placing seven commodities and their derived products on the EU market unless they are deforestation-free, legally produced and covered by a due diligence statement.
G
- Carbon and climate
GHG Protocol
Greenhouse Gas ProtocolThe GHG Protocol is the most widely used international standard for measuring and reporting greenhouse gas emissions. It was developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD).
- Carbon and climate
Greenhouse gases (GHG)
Greenhouse gases (GHG) are the gases that trap heat in the atmosphere. Carbon accounting covers the seven gases of the Kyoto Protocol and expresses them in tonnes of CO2 equivalent (tCO2e).
- Concepts
Greenwashing
Greenwashing is presenting a company, product or service as more environmentally friendly than the evidence supports, through vague claims, selective information or labels that nobody checked.
- Reporting
GRI
Global Reporting InitiativeThe GRI (Global Reporting Initiative) Standards are the most widely used voluntary framework for sustainability reporting worldwide. They help any organization report its impacts on the economy, the environment and people.
I
- Reporting
IRO
Impacts, risks and opportunitiesIROs (impacts, risks and opportunities) are the units a company identifies and scores in its double materiality assessment under the ESRS. Impacts are the company's effects on people and the environment; risks and opportunities are the financial effects of sustainability topics on the company.
- Ratings and standards
ISO 14001
ISO 14001 is the international standard for environmental management systems. It sets the requirements an organization must meet to manage its environmental impacts, comply with its legal obligations and improve its performance, and it can be certified by an accredited body.
- Ratings and standards
ISO 26000
ISO 26000 is the international guidance standard on social responsibility, published in 2010. It explains how an organization can structure its CSR approach, but it contains no requirements and cannot be certified.
L
- Carbon and climate
Life cycle assessment (LCA)
A life cycle assessment (LCA) measures the environmental impacts of a product or service across its whole life, from raw material extraction to manufacturing, transport, use and end of life, on several indicators at once.
- Reporting
Limited assurance
Limited assurance is the level of verification the CSRD requires for sustainability reports: an auditor or independent assurance provider checks that nothing has come to their attention suggesting the report is materially misstated.
M
- Suppliers and management
Management system
A management system is the set of policies, processes, roles and records an organization uses to reach its objectives on a topic (quality, environment, health and safety, CSR) and to improve over time.
- Reporting
Materiality assessment
A materiality assessment is the process a company uses to identify and rank the sustainability topics that matter most, for its stakeholders and for its business, so it can focus its strategy and reporting on them.
N
- Carbon and climate
Net zero
Carbon neutralityNet zero is the state in which greenhouse gas emissions are reduced as far as possible and the small residual remainder is balanced by permanent removals of CO2 from the atmosphere. At company level, it means deep cuts across the whole value chain first.
- Reporting
Non-financial reporting
Sustainability reportingNon-financial reporting, now usually called sustainability reporting, is the publication of a company's environmental, social and governance information alongside its financial statements.
O
P
S
- Carbon and climate
SBTi
Science Based Targets initiativeThe SBTi (Science Based Targets initiative) checks and validates companies' greenhouse gas reduction targets against what climate science says is needed to limit warming to 1.5°C.
- Carbon and climate
Scopes 1, 2 and 3
Scopes 1, 2 and 3 are the three categories of greenhouse gas emissions defined by the GHG Protocol. Scope 1 is direct emissions, scope 2 is indirect emissions from purchased energy, and scope 3 is all other indirect emissions in the value chain.
- Concepts
SDGs
Sustainable Development GoalsThe Sustainable Development Goals (SDGs) are the 17 goals, broken down into 169 targets, adopted by UN member states in September 2015 as part of the 2030 Agenda for Sustainable Development.
- Suppliers and management
Sustainability questionnaire
CSR or ESG questionnaireA sustainability questionnaire is a set of questions a customer, investor or bank sends a company about its environmental, social and governance practices, usually with evidence to attach. EcoVadis and CDP are the standardized versions; many large buyers also send their own.
- Suppliers and management
Sustainable procurement
Responsible purchasingSustainable procurement means building environmental, social and ethical criteria into purchasing decisions, alongside price, quality and delivery, and working with suppliers to improve their practices.
U
V
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