This week, I will be presiding over a panel on risk and sustainability at the annual conference « Entreprises et développement durable » (www.cedd.ca) organized by Unisféra . I thought this a natural fit since risk management has been an inherent part of my planning model in sustainability.
Let me tell you about a discussion I had on the subject of risk management and sustainability.
This sort of story in my field of work usually starts by trying to convince someone to integrate sustainability in their everyday work. Well, this ones starts a bit differently… It starts with an engineer telling me that he completely agreed with the sustainability principles and that is why environmental risks were always part of his planning. If you know me a bit than you’ve heard me saying that environment does not equal sustainability. Even if you take ROI into account. So the discussion wasn’t about wheter or not sustainability is good but about the nuances that have to be taken into account to achieve this long term goal. I gave this person a concrete but generic exemple:
Let’s say that you emit dust or particulates. It would be a good thing to identify this as an environmental risk since you have a certain impact on biodiversity around your operations. You risk having an inspector fining your organisation for your emissions if they exceed the standards. Sustainability is all about nuances. So lets change this scenario and say that the same emission of dust or particles are categorized as a social risk… It then becomes more serious at the same time as less tangible. More serious since it could mean an injunction and the forced stopping of these emissions (which could signifies major production delays, thus potential lost revenus). Less tangible since there are no full prook KPI’s that can predict an action by some of your stakeholders. Furthermore, if your stakeholders file a suite, it could impact the image of your organisation and thus, its access to capital or ressources. So it is not enough to believe in sustainability, you also have to understand the open-system nature of your organisation and the many dimensions in which it evolves.
Sadly, I haven’t found a fullproof model of risk management. Don’t get me wrong, there are a lot of great models out there but they mostly rely on the point of view of the person filling the model. So get an open-minded risk manager to help you in this part of your sustainability strategy.
Here are two links on the subject:
- Deloitte: Sustainability reporting, managing risks and opportunities
- Risk Management: La RSE comme rempart en cas de crise d’image