As risk management professionals, we must ensure corporate objectives related to environmental commitments are met. Many organizations are making environmental commitments or joining movements like The Climate Pledge. Once this kind of action is committed as a strategic objective, our responsibility is to evaluate the control environment to ensure these commitments actually happen. From a reputational risk perspective, failure to follow through will result in bad press, loss of customers, and loss of investors. Even worse, failure to hold up our commitments will create an even more significant impact on environmental issues and related financial risks in the long term.
To help you get started, use these six questions to assess the current situation for your organization’s environmental commitments:
Using these questions to facilitate the conversation with senior management and board members will provide an excellent starting point in evaluating your organization’s response to environmental risk. The insights you gain from the conversations will enable you to assess whether environmental concerns are truly embedded into the strategic objectives, or if these are performative in nature. Answering this question will reveal either commitment to a cause or a pending financial risk.