Challenges of Integration Risk Management of Sustainability of Business Processes to Corporate Governance of the Company

Abstract

The sustainability of risk management process discussed in this article is a business process that supports the company’s sustainability goals and aims to align sustainability with risk management based on corporate risk management principles. The associated risks are determined by the ESG practice of the company’s business, its strategy and the sector of the economy in which it operates. The Committee on Sustainable Development of FERMA in ESG considers environmental risks (climate, resources, pollution), social risks (people and communications, products and services, external and internal shareholders) and management risks (corporate governance, business ethics and behavior). Companies in the “sustainable development” phase take a corporate approach to ESG risks and link them to common strategic objectives. In the process of identifying ESG risks, it is possible to follow different approaches, in particular, maintaining a risk register, including ESG risks, or discussing the company’s various sustainability prospects with top management and shareholders and, associated risks, or sorting risks related to strategic, operational and external, taking into account the impact on the state of sustainability of the company and, finally, in-depth analysis of all sustainability risks can be performed, and identified risks can be tracked in a common registry along with other business risks. The risk assessment phase aims at potential risk by quantifying its probability of occurrence and impact. At the same time, the assessment of sustainability should be broader and multidimensional, the potential consequences for the company, its reputation and durability should be taken into account.