CSR/ESG implementation is not a stand-alone project. Management must examine how to connect the CSR/ESG corporate concept to legal or regulatory compliance. First, you must parse how various definitions of CSR and ESG in the business and organisation related to the law, demonstrating that each term has been used about compliance and is rooted in a dialogue on ethics or risk management.
The CSR/ESG environment directly affects the performance of an organisation. The primary focus is on a positive relationship between CSR/ESG and financial performance. Let us take a practical step-by-step approach to achieve the objective:
Step 1. In each organisation, The relationship and similarities between CSR/ESG and compliance must be fully defined, especially for organisations where CSR/ESG is a new focus and implementation area.
Step 2. while identifying the relationship and similarities between CSR/ESG and compliance, find the duplication and overlap between the two. Recognise the connection with existing frameworks for managing risks.
Step 3. As with other risk areas, look at the CSR/ESG financial impact, how often it occurs, the inherent risk and how it affects the business.
Step 4. After identification of the overlap and overlay, Identify the enormous cross section that is affected by CSR/ESG. Like compliance, ESG/CSR touches multiple departments of the enterprise, albeit in a somewhat different way.
Step 5. By becoming involved with CSR/ESG, the compliance team can have more contact with the organisation, address issues in a new way and help define what CSR/ESG means to the organisation.
Step 6. The approach will enable the compliance team to open departmental doors and become an active partner in CSR/ESG projects they usually do not participate.
Step 7. The result must be that the above steps should provide the ESG and compliance teams with greater visibility into the organisation and act as a bridge between compliance, ESG and the business.
Step 8. As a side benefit, the compliance, CSR/ESG, and risk teams will discover new repositories of data within the firm, enabling it to assess their areas of responsibility better
Step 9. Ensure that the above approach has provided the teams with the following opportunities.
- Earning CSR compliance, a place on the board of directors’ agenda
- Creating a greater appreciation for the corporate risk management process
- ESG focuses on values and integrity as a critical part of compliance programs.
Compliance and CSR/ESG focus on ethical practices, accountability and responsiveness of the organisation and its relationship with its stakeholders.
Participate at the 15th annual GRC Summit on the 16th of November to get additional information on the compliance component of CSR/ESG.
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