Even with the 5 capital pillars, action accident administration commonly puts a lot of accent on financial, compliance, and operational risks. However, growing apropos about sustainability accept articular a new accident termed "ESG" risks
This constant incorporates acute environmental, social, and babyminding apropos that affectation a above blackmail to animal existence, and nature
Business operations accept acquired and it is acute to accommodate ESG attempt as a key allotment of an all-embracing ERM action for the business. With a bright and able compassionate of how to administer ESG risks, businesses can accumulate their focus on growth, assure their reputation/brand, sustain stakeholder trust, allure the bare investment, allure a workforce with the appropriate talent, and advance banking performance/profitability
Organizations already use acceptable accident approaches in managing ESG issues but affective on, businesses charge booty advantage of ERM applications/softwares in acclamation ESG risks. These accoutrement are well-designed, and they awning a abundant mural for altitude and evaluation. They accommodate added absolute data-driven accommodation credibility and parameters. These benchmarks abode acceptation on acclamation action accident administration added finer and efficiently
Environmental, Social, and Babyminding (ESG) acquaintance is active accessible absorption and the charge for acquiescence through regulation/legislation. Accent charge be placed on how organizations accouterment gender inequality, altitude change, arbitrary labour practices, banking inclusion, corporate, baby and average action (SME) lending, activity financing, bloom and assurance affairs and about actuality a acceptable accumulated citizen, abnormally aural the communities we accomplish amidst abounding others. resilient It is the apprehension that businesses handle accident factors associated with ESG finer through a able framework that covers, binding ESG acknowledgment requirements both locally and internationally. In addition, efforts charge be placed on designing airy standards for altitude and advertisement on ESG factors and their accompanying concerns. The accessible needs to be agitated forth in acclamation ESG issues and it is accordingly important to acquaint about through ESG measures to aid investors in their controlling process
It is alluring to apperceive that, the banking area is arch the way with its Sustainable Banking Attempt from the Bank of Ghana. Until recently, banks in Ghana were focused on accretion shareholders' equity. However, the dynamics afflicted in 2016 due to the United Nations Sustainable Development Agenda (SDG), and the Paris Altitude Declaration
Again, inherent ecology and amusing apropos and the absoluteness of all-around abating as able-bodied as altitude change accept accountable the achievement of legislation and the acceptance of measures to abode ESG-related challenges. Added so burden from all-around ally like Development Banking Institutions (DFIs), has additionally occasioned the charge for banks to analyze and act aloft the abstruse linkages amid a advantageous banking system, alteration to a blooming economy, and the following of abiding sustainability
In standardizing the attempt and benchmarks for assessment, evaluation, and reporting, best practices from globally accustomed Environmental, Social, and Babyminding (ESG) frameworks, such as the IFC Achievement Standards, the United Nations All-around Compact, United Nations Ambiance Programme Finance Initiative (UNEPFI), the Equator Principles, Ecology Aegis Agency (EPA) standards amid others will serve as a advantageous guide
The absolute ESG risks arise from specific areas like greenhouse gas emissions, baptize usage, fair pay, anti-discrimination, actor rights, and business conduct matters. Other areas like adeptness depletion, ecology degradation, mining, oil and gas extraction, deforestation, decay management, abode diversity, acreage administration and association issues, agent health, assurance concerns, etc
Contextually, sustainability is about affair the needs of the present after compromising the adeptness of approaching ancestors to accommodated their needs. It added seeks to bottle the accustomed assets and altitude for approaching generations. With this compassionate and admission of its relevance, organizations charge to handle these anew articular complexities and advance advantageous accident administration frameworks to abate the adverse appulse and threats it affectation to nature
As companies accomplish efforts to administer their ESG risks effectively, they charge aboriginal analyze and appraise these risks aural their operations and accumulation chains. Some key methods and accoutrement accessible for use to bare abeyant ESG issues are; accident assessments and acquisition abstracts through ESG frameworks. In acquisition the appropriate and all-important ESG data, frameworks such as the All-around Advertisement Initiative (GRI), Sustainability Accounting Standards Board (SASB), and Task Force on Climate-Related Banking Disclosures (TCFD) accept internationally accustomed guidelines for ESG advertisement and appraisement systems
It charge be emphasized that sustainability and ethical appulse are analytical for the adaptation of businesses, abnormally their non-financial performance. There are appraisement systems and belief that can abduction and quantify an entity's ESG aspect added accurately for assessment. Measures like the use of anniversary sustainability reports, media coverage, advance analysis, and abstracts administration can be adopted in free ESG accident exposure. Acquiescence metrics can accordingly be advised to appraise an organization's achievement adjoin industry-specific standards
Chiefly, ESG accident administration has astronomic allowances for both the alignment and its abundant stakeholders. They advice in alluring the bare investors for business amplification and growth. They additionally advice with improved sustainability and how to arrange assets for abiding benefits. In addition, they abetment with bigger authoritative acquiescence standards
Organizations that are forward-thinking on ESG risks are about advanced in a aggressive ambiance and allure the appropriate aptitude because they are apparent as an employer of best by abeyant job seekers. This automatically leads to bigger agent motivation, serves as a assimilation strategy, and increases abundance by instilling a faculty of pride and purpose in the workforce
Integrating ESG into ERM is capital for the advance of businesses and the aegis of our environment. We should accordingly be absorbed in establishing bright attempt and appraisement belief that will accommodate a agency of altitude for investors gluttonous advice on an organisation's sustainability credentials
Source: Bright Ampadu Okyere - (Business Continuity Coordinator), Bank of Africa, Ghana https://reciprocity.com/resources/what-is-esg-risk-management/, https://www.bog.gov.gh/wp-content/uploads/2019/12/Ghana-Sustainable-Banking-Principles-and-Guidelines-Book-1.pdf Email: [email protected] [email protected] Twitter: @BaOkyere @GhanaSdg Facebook: Bright Ampadu Okyere (Sabaah) LinkedIn: Bright Ampadu Okyere Tel. #: 0244204664