Environmental, social, and governance (ESG) reporting has been increasing in prevalence for several years. A new administration and increasing focus from investors are spurring the next wave of requirements. Many gaming companies will need to develop new processes and implement new systems and controls to meet the challenge. This means the finance and IT organizations will be front and center in this mission-critical area.
What is ESG
ESG refers to environmental, social and governance. In the context of companies, ESG is a broad, and integrated, term to capture the strategies that exist to address risk in these areas, capitalize on opportunities, and measure and report progress. For example, buying from a diverse supplier base may be a requirement for a casino in certain states, so ensuring the company has processes in place to do so (and then report compliance) mitigates a regulatory risk. But the potential to source new goods and services from vendors the gaming company may not have otherwise accessed represents the opportunity for competitive advantage.