What are Direct impact and Indirect Impact at ESG?

• Businesses and investment activities make an impact and depend on natural resources and ecosystem services.

• A direct impact is directly affecting biodiversity, such as toxic materials are released,

• An indirect impact is indirectly affecting biodiversity in the supply chain, which is from purchasing raw material, producing finished goods, through logistics, to selling products. A typical example is Green House Gas(GHG) emmission in supply chains.

• Although indirect impacts may be relatively difficult to predict and manage, they should be traced because they can be as significant as direct impacts.