ESG Risk Identification and Quantification, although not conventionally tied to financial metrics, ESG risks can lead to financially material operational disruptions, making it imperative for organisations to acknowledge and incorporate ESG risks into their Enterprise Risk Management Framework. This, in turn, enables financial services organisations to build resilience and generate long-term sustainable value therein.
Furthermore, through the processes of ESG risk identification, assessment, and quantification, financial services organisations can gain a comprehensive understanding of the potential ESG-related threats or risks they may encounter, as well as the likely implications to their operations. Enabled by these insights, organisations can make informed, data-driven decisions regarding their resources, operations, and overall strategic direction.
At TORI Global, we use our Subject Matter Experts (SMEs) to guide financial services organisations through systematic and methodical identification, assessment, and management of ESG risks. Our expertise spans across ESG Risk Management methodologies, data production and analysis, and the integration of these ESG practices and processes into the Enterprise Risk Management systems.
What is the business case?
Establishing a robust ESG Risk Identification and Quantification process and integrating it into the existing Enterprise Risk Management Framework, empowers financial services organisations to enhance and reinforce their long-term financial and operational resilience.
By proactively identifying pertinent ESG risks (and potential opportunities alike!) and rigorously assessing and quantifying their potential likelihood and impact to the organisation, financial institutions develop the capability to formulate effective risk mitigation strategies; mitigating against potential financial losses and operational disruptions, while also capitalising on ESG opportunities as they arise.
Furthermore, accurate risk quantification provides organisations with invaluable data and insights regarding future ESG risks and opportunities. These insights, in turn, empower Management to take data-driven strategic decisions and allocate resources based on heuristics gained through quality information and quantitative performance indicators.
Through the development and implementation of a robust and systematic ESG Risk Management Framework, financial services organisations stand to gain a competitive advantage, attracting investors and other stakeholders who regard sustainability and risk management as a prerequisite to doing business.
How can TORI help?
TORI Global offer the following services under the ESG Risk Identification and Quantification Proposition:
- ESG Risk Identification, Assessment, and Quantification
- Integration of ESG into the Enterprise Risk Management (ERM) Programme
- ESG Risk Management Maturity Assessment
- ESG Risk Reporting and Disclosure
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