These 4 ESG Questions are Essential for Risk Managers. What is Your Answer?
These 4 ESG Questions are Essential for Risk Managers. What is Your Answer? The Danger of ESG Commitments Unaligned with ERM Goals In recent years, Environmental, Social, and Governance (ESG) concerns have become increasingly important to all businesses and their stakeholders. In addition, major businesses based in the European Union (EU) are gearing up for the introduction of the Corporate Sustainability Reporting Directive (CSRD), which would standardize CSR reporting in the EU. Thus, organizations, top executives, and boards are putting even more emphasis on the need for strong ESG frameworks. ESG is an important part of many multinational organizations’ growth strategies. Yet, firms risk not “living the talk” by not aligning their ESG commitments with their ERM plan. Therefore, it is crucial for a Risk manager to not only recognize the most significant ESG risks, but also to foresee the potential legal exposures that the business may face. We have compiled four critical inquiries for risk professionals and management to think about. Risk managers should ask themselves the following four questions about ESG risks: 1. Does your organization take into account ESG risks as its core risks? The ESG agenda may be a top priority for your organization, and you may have even set some lofty sustainability goals to work toward. Yet, as part of your risk management, have you analyzed ESG Risks in depth and implemented any necessary changes? When working with ESG Risks, it can be hard to know how these risks might affect your business in detail. A holistic multi-stakeholder approach that uses all components of your sustainability agenda and challenges your risk management framework is needed to acquire a clearer picture. 2. Do you properly handle the “S” and “G” in ESG, or is your company susceptible to social or environmental washing? ESG efforts may put your company at danger of green or social washing. Governance (G), an often overlooked but crucial component of the ESG framework, comprises putting in place efficient institutions, roles, and responsibilities to support aspirational sustainability goals and initiatives. In addition, social and governance issues are typically overlooked in favor of environmental concerns. This causes the S and the G to be obscured, misrepresenting the true nature of the risks involved. The social and governance aspects of ESG are crucial to your business’s social license and reputation among consumers, existing and prospective employees, and society as a whole, therefore neglecting them can be risky. 3. Do the organization’s internal risk frameworks, such as ERM and internal controls, undergo periodic independent reviews? How does your firm recognize major risks? Do you have a method for identifying risks that is both well-informed and intellectually curious, one that questions conventional wisdom about your company and takes into account crucial industry aspects like sustainability and geopolitical tensions? Even inside your own company domain, such as your sector, nation, or product region, it can be quite challenging to understand seismic movements. The human mind has a propensity to draw erroneous inferences, apply bias, and extrapolate from the past to present issues in order to facilitate quick and efficient decision-making. Designing a risk identification process that actively involves […]
Read moreESG Has Now Evolved Into Risk Management. Is Your Organization Ready for the Change?
ESG Has Now Evolved Into Risk Management. Is Your Organization Ready for the Change? ESG (Environmental, Social, and Governance) has roots in Corporate Social Responsibility (CSR) and the environmental movement, but it today encompasses an organization’s impact on society and the environment, climate change threats, and changing attitudes about ESG concerns.
Read moreEmerging Trends in APAC ESG Landscape: Challenges and First-mover Advantages
Emerging Trends in APAC ESG Landscape: Challenges and First-mover Advantages ESG Developments and the Overall Situation Organizations throughout the world are under increasing pressure from all directions to include Environmental, Social, and Governance (ESG) metrics into their core business strategy and to enhance ESG transparency and performance as a result of the changing global risk climate. Continued supply chain disruptions, COVID-19 pandemic implications, digital transformation issues, climate risk, shifting ESG considerations/standards, and lawsuits have compounded this transition.
Read moreThe Significance of Internal Controls for Organizations’ Data Privacy
The Significance of Internal Controls for Organizations’ Data Privacy Data privacy has been considered as an important business objective for organizations. It mainly deals with users’ sensitive or confidential data that may include personally identifiable information (PII), credit card data, or personal health information. Through effective data privacy practices, organizations can avoid unwanted actions like the unauthorized access and use of data. Besides, organizations can also build trust with the “data subjects” or data owner. It can even help organizations to collect, save, and process personal data according to the regulatory compliance obligations or specific industry standards.
Read moreData Privacy and ESG Risk: 7 Critical Issues Every Business Must Answer
Data Privacy and ESG Risk: 7 Critical Issues Every Business Must Answer As businesses go digital and their products and services grow more complex and data-driven, privacy and security concerns relating to this data have emerged as major sources of risk for them. Due to how often personal data is collected and used, data privacy and cybersecurity have become material environmental, social, and governance (ESG) issues (MEIs) for companies in a wide range of sub-industries.
Read moreCybersecurity Budgets Are Going Up. So Why Aren’t Breaches Going Down?
Cybersecurity Budgets Are Going Up. So Why Aren’t Breaches Going Down? Over the past few years, cybersecurity has become a major concern for businesses around the globe. With the total cost of cybercrime in 2023 forecasted to reach $8 Trillion – with a T, not a B – it’s no wonder that cybersecurity is top of mind for leaders across all industries and regions. However, despite growing attention and budgets for cybersecurity in recent years, attacks have only become more common and more severe. While threat actors are becoming increasingly sophisticated and organized, this is just one piece to the puzzle in determining why cybercrime continues to rise and what organizations can do to stay secure.
Read moreWhat Stricter Data Privacy Laws Mean for Your Cybersecurity Policies
What Stricter Data Privacy Laws Mean for Your Cybersecurity Policies For today’s businesses data privacy is already a big headache, and with modern privacy laws expanding to more of the world’s population, regulatory compliance is on track to become a more complicated, high-stakes process touching on every aspect of an organization. In fact, Gartner predicts that by 2024, 75% of the Global Population will have its personal data covered under privacy regulations.
Read moreMiddle Eastern Cyber Security Trends for 2023 and Beyond
Middle Eastern Cyber Security Trends for 2023 and Beyond As 2022 winds down, 2023 looks set to be a transformative year for businesses across the Middle East. In light of the region’s rush to digitalization, Netskope has released its yearly threat forecasts and predicted trends in cyber-attacker behaviour, cloud security, and more.
Read moreTop 12 Trends in Enterprise Risk Management to Look Out for 2023
Top 12 Trends in Enterprise Risk Management to Look Out for 2023 Enterprise Risk Management (ERM) has stepped into the spotlight as businesses attempt to deal with the long-term repercussions of the COVID-19 pandemic, the possibility of a recession, and the quick rate of development.
Read more5 Risk Management Trends to Watch in 2023, as Seen by CROs Across the World
5 Risk Management Trends to Watch in 2023, as Seen by CROs Across the World Economies and civilizations are experiencing multiple crises concurrently at this time. The era is marked by the simultaneous emergence and interaction of multiple, complex disruptions with widely varying causes and eventual outcomes. Climate change, the COVID-19 pandemic, record inflation and monetary tightening, supply interruptions, and heightened geopolitical risk all raise important organizational resilience problems that must be addressed together.
Read more