Webinar: how risk management can contribute to sustainable growth?
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This webinar will help risk management and sustainability practitioners apply enterprise risk management (ERM) concepts and processes to environmental, social and governance-related risks (ESG)
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Webinar: how risk management can contribute to sustainable growth?
- 1. www.ferma.eu LIVE WEBINAR – FOLLOW US @FERMARISK #FERMAWEBINAR FERMA Risk Leadership at the heart of Europe Suscribe to our newsletter: www.ferma.eu Contact us: enquiries@ferma.eu
- 2. www.ferma.eu HOW RISK MANAGEMENT CAN CONTRIBUTE TO SUSTAINABLE GROWTH? LIVE WEBINAR #2 @FERMARISK #FERMAWEBINAR
- 3. www.ferma.eu RODNEY IRWIN Managing Director of WBCSD, Redefining value and Education programs PAUL J.SOBEL Chairman of COSO
- 4. www.ferma.eu Polling question #1 Are ESG-related risks a priority for your organisation? HIGH / MEDIUM / LOW
- 5. www.ferma.eu Polling question #2 Do you play a specific role regarding ESG- related risks in your organisation? YES/ NO / PLANNING TO
- 6. www.ferma.eu The global landscape continues to shift 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Asset price collapse Extreme weather events Slowing Chinese economy (<6%) Failure of climate-change mitigation and adaptation Chronic disease Natural disasters Global governance gaps Data fraud or theft Retrenchment from globalization Cyberattacks Asset price collapse Weapons of mass destruction Retrenchment from globalization (developed) Failure of climate-change mitigation and adaptation Oil and gas price spike Extreme weather events Chronic disease Water crises Fiscal crises Natural disasters Top5GlobalRisks: likelihood Top5GlobalRisks:impact Economic Environmental Geopolitical Societal Technological Source: WEF 2019
- 7. www.ferma.eu Companies have been impacted by the changing business context 1970s 1980s 1990s 2000s 2010 2011 2012 2013 2014 2015 2016 2017 2018
- 8. www.ferma.eu Companies have been impacted by the changing business context Climate change is now
- 9. www.ferma.eu Previous research revealed companies struggle to identify ESG-related risks in annual risk filings despite identifying them as material in sustainability reports www.wbcsd.org/Programs/Redefining-Value/Business-Decision-Making/Measurement- Valuation/Resources/Sustainability-and-enterprise-risk-management-The-first-step-towards-integration/
- 10. www.ferma.eu 29% Average alignment 8% 57% 35% Partial alignment Full alignment Zero alignment The case for change - 2016
- 11. www.ferma.eu
- 12. www.ferma.eu Joint COSO/WBCSD Guidance on ESG Risks
- 13. www.ferma.eu How Can This Guidance Help? • Enhanced resilience • A common language for articulating ESG-related risks • Improved resource deployment • Enhanced pursuit of ESG-related opportunities • Realized efficiencies of scale • Improved disclosure
- 15. www.ferma.eu Polling question #3 To what extent do you work with ESG specialists? Regular and close collaboration based on a clear mandate / Occasional collaboration / No relationship and involvement / Under my responsibility
- 16. www.ferma.eu Polling question #4 What is the greatest challenge to integrate ESG into the ERM process? Limited knowledge of sustainability risks / Difficulty quantifying sustainability risks / Limited collaboration btw ESG and ERM specialists / Omission of opportunities or strategic risks / Lack of support from Board and Top Management
- 17. www.ferma.eu Q&A
- 18. www.ferma.eu • Thank you message • To go further: a dedicated Masterclass on this guidance delivered by Rodney at the FERMA Forum in Berlin on 20 November 2019 • Free registration for risk manager at www.ferma- forum.eu • Replay available soon on FERMA youtube channel CONCLUSION
- 19. www.ferma.eu SUBJECT: TO BE CONFIRMED WHEN: MAY / JUNE HOW: email invitation and/or register on www.ferma.eu THANK YOU & JOIN OUR NEXT WEBINAR RECORD YOUR 2 CPD POINTS CONTACT US: enquiries@ferma.eu
Editor's Notes
- Introduction by Typhaine WELCOME SPEAKERS INTRODUCTION FERMA interest in this guidance Our seminar on sustainability in October 2018 Mention of the EU context: NFR directive, Sustainable Finance Action Plan, Tax transparency initiatives Involvement of FERMA since 2013 in the reporting of non-financial information
- History of the project, how and why both organisations came to work together? What was your starting hypothesis? ESG-related risks are increasing and are harmful from a financial and reputational perspective (examples?) Reach back to 2012, first discussions at WBCSD in 2013, became more concrete in 2016
- How the report was built? Use of the revised 2017 COSO structure Was the 2017 COSO update a trigger to do such guidance on ESG-related risks?
- We take the top 3 challenges and Rodney and Paul are providing recommendations/ advices on each challenge Limited knowledge of sustainability risks Difficulty quantifying sustainability risks Limited collaboration btw ESG and ERM specialists Omission of opportunities or strategic risks Lack of support from Board and Top Management Collaboration challenge: ESG-related are very specific. What benefits to expect? Are there ESG area already covered by ERM (the "G") Quantification challenge: materiality, financials, externalities of ESG elements Support challenge: How to launch such "transformation"? How to attract
- FERMA survey in 2018 showed that: 71% of respondents have regular or occasional collaboration with ESG specialists ¼ have no relationship at all
- 5 options: Limited knowledge of sustainability risks Difficulty quantifying sustainability risks Limited collaboration btw ESG and ERM specialists Omission of opportunities or strategic risks Lack of support from Board and Top Management
- Examples: >Did you receive yet some feedback from CEOs who considers starting this integration? >How to incentivise the organisations to start such integration? >What recommendation to quantify ESG-related risks (standards, metrics…)? …etc