Risk managers have a clear role to play in developing and managing ESG strategies for their organisations, but work is needed to define where best to focus efforts, according to a new survey conducted by WTW.
Over 310 corporate houses globally participated in the survey and these organisations employ more than 2m people in total. Conducted between April and August 2022, the primary question that the survey looked at was on how ESG (environmental, social and governance) factors are impacting corporate risk management?
The survey also examined how engaged risk managers are, and expect to be, in addressing ESG risks and pressures. It found that risk managers have a clear role to play in developing and managing ESG strategies for organisations.
Three quarters of respondents (74%) said improving their organisation’s ESG score is a core focus for the business today. However, while the majority of risk managers said their organisations have ESG goals, only 17% have documented targets with clear milestones for ESG risks.
While just over half of respondents said the risk management function (55%), and they personally (54%), are significantly involved in their organisation’s ESG efforts, 77% believe the risk management function should take a more active role in ESG initiatives and strategy.
While more than 80% of organisations that have documented or are actively discussing climate goals said they have stated carbon or emissions targets, other climate and resilience risk management goals are frequently more vague or absent.
Most respondents (54%) believe risk management practices in the environmental liability area influence their ESG standing. Accordingly, three quarters of respondents have taken actions to address environmental liability and climate risks. However, many have done so without specific goals or key performance indicators.
Many respondents identify major risk management priorities in areas such as data privacy and cyber risk (97%), workplace safety and product and employment liability, although they also acknowledge gaps in their ability to influence procedures. M