Risk Management

We work with companies to manage the risks their businesses face due to a changing climate and wider sustainability considerations.

We help organisations identify material sustainability-related risks and opportunities, identify areas of their business most at risk or able to catalyse opportunities.

Our 4-staged Sustainability Reinvented risk management programme includes:

Materiality Assessment: using our materiality assessment tool, we work with you to understand and assess the materiality of sector-specific, geography-specific, and organisation-specific risks and opportunities
Workshops: we work with senior and operational staff to further assess processes, linkages and opportunities related to climate and sustainability factors, and build the materiality matrix to understand short-term and long-term risks
Planning: using the outputs of phases 1 and 2, we develop bespoke climate/sustainability-related risk mitigation plans
Integrating and monitoring: our final stage is an ongoing partnership, where we work closely with your teams to ensure new plans and processes are implemented successfully

Risk management is a fundamental part of any business: fail to recognise risks or identify new opportunities, and you are unlikely to be successful in the long-term.

Ultimately, risk management allows you to build resilience, manage your impact and create new business opportunities.

Until recently, climate change and broader sustainability matters were considered by many to be a non-material externality: i.e. they had very little impact on the organisation’s bottom line and financial sustainability.

In the last decade, this has changed, and the concept of “double materiality” is now widely recognised:

Almost all organisations’ will, through some of their activities, have a positive or negative impact ‘on the world’ (impact of business => environment/society)
Almost all organisations’ face material risks and opportunities due to societal and environmental changes (impact of environment/society => business)

In the case of climate change, these risks are categorised principally as transition (e.g. regulatory changes, consumer demand changes, resource scarcity) and physical (e.g. severe weather) risks and opportunities.

Typical questions we look to identify include:

How are organisations conducting their materiality assessment? Is it sufficient, and does it take into consideration leading research, standards and best practices?
Are their forward-looking activities aligned with regulatory requirements, in particular linked to the Paris Agreement?
How are climate-related, or broader sustainability-related, risks being managed? Is the governance structure appropriate? Is it integrated in the overall risk management process to a sufficient level?
How are organisations determining the relative significance of climate-related risks in relation to other risks? Are they given the weight they should?
Have all external existing and emerging regulatory requirements been considered?
What processes are being used to assess the potential size and scope of risks and opportunities?
For financial institutions, how are these risks affecting credit risk, liquidity risk, operational risks? Are portfolios aligned with the goals of the Paris Agreement?