Transforming Gambling by Taking Ownership for Solid ESG

Consumers are more aware of a company’s social image than ever before and relevant information is available at any internet user’s fingertips. Although society has come a long way from carrying generational ideologies that lead to stereotypes, gambling remains infamous as a sin stock. Industry experts believe sustainable business practices, specifically ESG methodology, hold the key to transformation.

Studies concluded that an increasing number of consumers prefer supporting businesses with sustainable ESG strategies and investors even more so. How would gambling providers leverage environmental, social, and governance methodologies in the highly competitive online gambling industry? What are the opportunity costs for accountable practices that aren’t greenwashing attempts?

For igaming companies to adopt transformational ESG practices, the long-term returns must outweigh the potential sacrifices.

 Environmental Social Governance in Online Gambling

Some might think the remote nature of online gambling enables a minimal carbon footprint and low environmental impact from the multi-billion industry, but this is untrue. With investors putting greater importance on sound ESG, they force gambling companies to measure their environmental impact and enforce measures to minimise it.

Gambling platforms need a large amount of electricity to deliver their services. Although the igaming industry may not contribute as much as industrial industries, its carbon footprint is far from net-zero. 

Social responsibility enjoys much more attention in the gambling sector, with regulators enforcing stringent protocols for player protection goals and some operators taking the lead. Providers in the igaming industry have more than players to focus on in this area because a company’s social impact on its workforce becomes essential to sound ESG. An industry-wide effort to create practices and apply them can turn the page on the risks inherent to gambling. 

Gambling companies must consider their internal affairs and how it affects their reputations as negative publicity seems intertwined with the industry. Operators have to consider regulatory requirements and ensure their companies are compliant and function in a law-abiding manner. Executive ethics and corporate culture all contribute to sustainable governance.

 Win-Win with ESG

When all three pillars underline business principles, providers in the gaming industry gain an essential skill set. They can leverage this to create value and encourage resilience. ESG helps the business to improve its risk identification and management which leads to reduced risks and costs. 

Sound ESG credentials can transform a company’s reputation and attract customers, skilled employees, and investors. 

The igaming industry must adopt renewable energy strategies to aid in the goal of net-zero emissions by 2030. A better understanding of its carbon footprint leads to further improvements in environmental impact. Companies like Kindred and La Francaise des Jeux (FDJ) lead the way, showing other operators it is possible to make the change.

Industry-wide agreements and game design standards on the risk levels and exposure for vulnerable players can turn the tide for social responsibility. This critical area has the potential to transform pre-conceived notions about gambling and help the industry attain a net-positive impact.

 Harnessing Potential

ESG is not a new concept, yet gambling companies have much work to do in the area. This presents a vital opportunity for the industry and if providers harness the potential, the outcomes can be truly positive.