Environmental, Social and Corporate Governance (ESG) practices are the framework of sustainability parameters which directs the business towards accountable and responsible behavior to achieve growth. Nowadays, it has been well recognized, and is being emphasized that old system of assessment of investment, based only on financial performance needs to be overhauled. Rather, it has been accepted that the integration of ESG factors into financial indicators is the need of the hour to judge the performance of entity. It is believed that it would also strengthen the exposure of business to global sustainability-related shocks. In fact, this school of thought has played a major role in bringing awareness about the link of sustainability with the financial system. It has grabbed the attention of companies to maintain a balance between financial and non-financial indicators. They are formulating and implementing policies and strategies by incorporating ESG factors. This study is aimed to highlight the impact of ESG practices along with the challenges, and opportunities posed by it. The descriptive model of research has been applied. To put it differently, a qualitative literature-based approach has been embraced to ascertain the impact of ESG practices on businesses, and how are they beneficial and challenging for them. The Findings are indicating that sustainable efforts are changing the ways of doing business, and enhancing profitability, helps in mitigating risk and earning stakeholder trust. Although, it has posed certain challenges, such as, high cost of compliance, lack of standardized reporting framework, shortage of reliable data, dearth of sustainable infrastructure, and probability of reputational risks from ESG failures. However, these are very well manageable in the long-run.