In this episode, I visit with Rakhi Kumar, the Managing Director, Head of ESG Investing and Asset Stewardship for State Street Global Advisors (SSGA) on the firm’s recent white paper entitled, “SSGA’s Perspective On Effective Climate Change Disclosure”. While the white paper focused more specifically on climate impact and climate risk to businesses in the energy and mineral extractive industry, it set out a protocol which every Board of Directors can use for a wide variety of risks, including compliance risk.
We consider the purpose & methodology of SSGA’s white paper. We take a deep dive into the four areas of how a Board can better position climate change risk:
- Governance and board oversight of climate risk
- Establishing and disclosing long-term GHG goals
- Disclosing information on carbon price assumptions
- Discussing impacts of scenario planning on tong-term capital allocation impact
We then consider the SSGA approach in the context of a broader risk management process through the exploration of such issues as
- How broadly do climate related changes impact businesses?
- How should businesses prepare for disruption due to climate change or climate impact?
- Is there a business opportunity for companies which engage in strategic risk management around climate change?
For more from Rahki Kumar on the SSGA white paper, its application to the anti-corruption compliance practitioner, and management of strategic risk; see my blog post Will Your Assets Be Stranded? The Risk Management Process in ESG and Compliance
A robust risk management process provides both risk mitigation and significant business opportunities.Click to tweet