Environmental, Social and Governance (ESG) concerns are challenging Boards and Executives to translate them into tangible Risks and Opportunities for Sustainability and Resilience. ESG impacts are generally longer term in nature and, in many cases, out of the direct control of the Company, which makes the linkage of ESG Risks to Enterprise Risk Management even more relevant.
The prevalence of ESG-related risks has steadily increased while the more conventional economic, geopolitical and Technological risks have become less dominant. According to World Economic Forum’s The Global Risks Report 2018 Environmental Risks would be dominant next to Cyber Risks over the next decade. Companies that are demonstrably prepared for these shocks can better mitigate downside
Independent researches from major institutions and rising expectations from Shareholders and Stakeholders make it obvious that Environmental, Social and Governance concerns are vital factors for Corporate Sustainability. However, Organizations and Boards are moving at varied speeds in addressing ESG concerns, with the strategic importance of ESG varying widely by Company and by industry. An innovative