In a nutshell, the E in ESG stands for the environment. The ‘E’ takes into account how a company uses natural resources, as well as the impacts of its operations on the environment and the communities it operates in.

Companies should consider both direct operations and their value chain.

Software companies with no material production will mostly have an environmental impact by their operations, reflected in their energy consumption, cloud usage, travel (especially international flights), employee commute, plastic and paper waste.

https://www.youtube.com/watch?v=W3ka2MVzggQ

Source: Charles Stanley Channel