What Are ESG Risks
Environmental, Social and Governance
"Climate Change is Accelerating, Bringing World ‘Dangerously Close’ to Irreversible Change"
Environmental, Social and Governance (ESG) factors are being used increasingly by the investor community to assess the sustainability and risk profile of companies. ESG considerations can have a range of impacts on an organization’s financial performance and underlying shareholder value. Multiple bodies of research point to a positive correlation between financial performance and strong corporate ESG policies and practices.
Whereas Governance factors have been a feature of the corporate agenda for the longest time, it was in 2020 when we saw long-standing Social issues such as racial and other inequalities being firmly thrust onto board and executive committee agendas around the world.
And on the Environmental front, we are witnessing planet earth on an accelerated path to increasingly intense climate-related events at the same time as our window of opportunity to remedy the situation and act to avoid widespread economic, physical and social dislocation and devastation is rapidly closing.
Environmental
Environmental aspects include how a business performs as a steward of our natural environment, and includes:
- Climate change (mitigation and adaptation)
- Green House Gas (GHG) emissions
- Water security
- Waste
- Pollution
- Resource utilization & depletion
- Deforestation
Social
Social aspects consider how a company treats people, and includes:
- Inequalities
- Diversity & Inclusion
- Employee relations
- Health & Safety
- Working conditions
Governance
Governance addresses how a corporation governs and polices itself, and includes :
- Executive remuneration
- Board diversity and structure
- Donations and political lobbying
- Bribery and corruption
Environmental
Risks
Find out more about why climate change is a source of significant risk to global financial stability
Social
Risks
Get ahead of the increasing pressures and demonstrate and display your social credentials
Governance
Risks
Ensure your organization is on the path towards strong company governance structures that will drive value-creation
