Olympus TG-5 has a 12.0MP 1/2.3 (6.17 x 4.55 mm ) sized BSI-CMOS sensor and features TruePic VIII processor. On the other hand, Panasonic G7 has a 16.0MP Four Thirds (17.3 x 13 mm ) sized CMOS sensor .
Below you can see the TG-5 and G7 sensor size comparison.
As seen above, Panasonic G7 has a 8.0x Larger sensor area than Olympus TG-5. Larger sensors give photographer more control on the depth of field and blurry background compared to smaller sensor when shot in same focal length and aperture.