Goverance Form

Depending on where you are on your sustainability journey, there are different aspects which you as a board should consider. Whether you are just starting out or you are already making progress, it is good to stand back and reflect on whether you are on the right track and determine what your next steps should be.

The table is set out as follows:

  • Each column indicates one of four broadly defined levels of maturity of the board or leadership team.
  • The rows provide a list of suggested next steps for considering and embedding sustainability into your business.
  • The ♦ included against each step suggests which level of board or leadership team maturity, in relation to sustainability, it would be more relevant to.

We propose you read through the table and using the last column mark those steps you consider relevant to your business. You may find that the level of maturity varies according to the topic being considered. It has been designed to encourage boards and leadership teams to think more holistically about sustainability. The exercise can be taken one step further by suggesting that each member of the board or leadership team follows the same process, as preparation for a more formal discussion on sustainability to collectively determine a plan of action. The combined responses could indicate the areas which are considered important by the majority of members.

Start assessing your business below

You may find below the levels of maturity of the board or leadership team in relation to sustainability and its relevancy towards business. You need to check the box within the last column for each of the steps you consider as relevant next steps for your business.
Suggested next steps for considering and embedding sustainability into your business Not yet
considered		 Not sure it
is relevant		 Started, but it
needs direction		 A well-established
strategy		 Mark the
next steps
Review and understanding of board or leadership team responsibilities linked to sustainability:
  • Legal
  • Regulatory
 ♦ ♦
Identification of priority/material ESG areas
Set/review your vision of where the company is and where it should be ♦ ♦ ♦
Perform an ESG health check to identify/confirm material risks, opportunities and impacts in relation to your business from a stakeholder perspective ♦ ♦
Perform a benchmarking exercise comparing your business and its sustainability status to that of some peers (ESG ratings, ESG disclosures, reputation etc.) ♦ ♦ ♦
Engage with key stakeholders (including shareholders):
  • Do your company’s priorities reflect those of your key stakeholders?
  • Do your stakeholders agree with the selection of the UN Sustainable Development Goals (SDGs)?
Update the company’s sustainability risk matrix 		♦ ♦ ♦
Select or review the SDGs relevant to your business. This exercise should include both those in relation to which the business has a negative impact, which should be eliminated, and those where it can have a significant positive impact linked to its purpose, culture and strategy ♦
Perform a materiality assessment exercise to identify or confirm the key ESG risks and opportunities relating to your business ♦ ♦
Perform a mapping exercise of your main first and second tier suppliers and identify the key ESG risks and opportunities your business is exposed to by doing business and being related to these suppliers.
Supply chain: spot check risks and opportunities including social and environmental aspects and of the key impacts of operations on your supply chain:
  • Regulatory reporting requirements
  • Industry-specific requirements
  • Policies and procedures
  • Map the scope/extent of your supply chain
  • Availability of data
  • Perform due diligence to ascertain and evaluate risks
 ♦ ♦
Designing an ESG action plan
Designing an ESG action plan
Design/review your sustainability action plan including:
  • Short, medium and long-term goals
  • Relevant KPIs
  • Establish targets
 ♦ ♦
Deep dive into your business plan, strategy, mission and vision to align/realign them with the company’s sustainability objectives ♦ ♦
Embedding sustainability into the business
Develop/review your sustainability governance structure ♦ ♦
Establish/review whether and how sustainability is reflected and embedded in your company’s corporate culture ♦ ♦
Perform a skillset audit to identify gaps:
  • Board/management level
  • Company wide
 ♦ ♦ ♦
Consider/establish/review performance-related incentive schemes linked to ESG targets and objectives ♦ ♦
Sustainability reporting
Consider your sustainability reporting:
  • What does this include? Annual report? Separate sustainability report? Other?
  • Are your disclosures relevant, meaningful, and reliable?
  • Consider level of compliance with legal and regulatory requirements
  • Review appropriateness of ESG metrics and targets
 ♦ ♦
Consider and determine whether assurance should be:
  • Internal or external
  • For external, whether limited or reasonable
  • Scope of each kind of assurance
 ♦ ♦
Depending on the relevance of each of the areas below, as a board you may want to consider the following:
Environment
Climate: spot check where you are and where you would like to be:
  • Regulatory reporting requirements
  • Industry-specific requirements
  • Initiatives underway towards meeting set targets
  • Is it enough? What are peers doing, what do shareholders and other stakeholders need?
  • Have opportunities arising from climate change been sufficiently considered?
 ♦ ♦
Biodiversity: spot check on where you are and where you would like to be, including topics such as water use, waste, forests, desertification:
  • Regulatory reporting requirements
  • Industry-specific requirements
  • Best practice
  • Initiatives underway towards meeting set targets
 ♦ ♦
Social
Diversity and Inclusion: spot check on where you are and where you would like to be, with regards to gender, ethnicity, social mobility and sexual orientation:
  • Regulatory reporting requirements
  • Industry-specific requirements
  • Policies and procedures
  • Availability of data
  • Perform due diligence to:
  • Identify and assess actual or potential adverse human rights impacts.
  • Track measures and processes to address adverse impacts and assess effectiveness.
  • Design an appropriate action plan.
 ♦ ♦
Other human rights issues: establish whether the business is proactively managing potential and actual adverse human rights impacts:
  • Regulatory reporting requirements
  • Industry-specific requirements
  • Policies and procedures
  • Availability of data
  • Perform due diligence to:
  • Identify and assess actual or potential adverse human rights impacts.
  • Track the effectiveness of measures and processes to address adverse impacts
    • and assess effectiveness.
  • Design an appropriate action plan.
 ♦ ♦
Governance
Governance
Anti-bribery and corruption:
  • Review risk assessment and mitigation plans
  • Review legal and regulatory compliance
  • Identify industry-specific requirements / best practice and benchmark
  • Review and update of policies and procedures
  • Assess availability and quality of data
  • Consider the need for a due diligence exercise
 ♦ ♦
Cybersecurity:
  • Review risk assessment and mitigation plans
  • Review legal and regulatory compliance
  • Identify industry-specific requirements / best practice and benchmark
  • Review and update of policies and procedures
  • Assess availability and quality of data
  • Consider the need for a due diligence exercise
 ♦ ♦
Others
(complete with other areas which may be relevant to your specific business, industry sector or geography)
This could include considerations such as water, waste, biodiversity, etc.

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