Increasingly, companies are being judged by their performance in terms of Environmental Social Governance (ESG). But exactly what does it mean, and what should be done about it? While much ambiguity exists, it is no longer sufficient to negotiate the environmental assessment process successfully. ESG is an ongoing process that spans the entire life cycle of a company and its operations.
This book is aimed at business leaders – senior executives and company directors – and particularly those involved in the extractive industries and other ventures that significantly affect the environment and host communities. Guidance is provided on the major ESG issues that confront all business leaders. Strategies are provided to address ESG risk and to handle crises when they occur.
Author(s): Karlheinz Spitz, John Trudinger, Matthew Orr
Publisher: CRC Press/Balkema
Year: 2022
Language: English
Pages: 296
City: Boca Raton
Cover
Half Title
Title Page
Copyright Page
Table of Contents
Foreword
About the authors
Acknowledgements
01 Environmental and social aspects of governance in a changing environment: the Board’s role
ESG considerations no longer “Nice to Have” but a must
ESG enters the boardroom
Boards that adapt will prosper
Board composition
The coming impact of ESG on strategy
Directors’ dilemma: ESG obligations or overkill in the boardroom
Looking ahead: identifying key trends in ESG
02 Yes, sustainability can be a strategy
Concept of sustainable development
Profit, People, and Planet
What makes our business sustainable?
Sustainability: cost that pays for itself
Role of Government regulation and leadership in increasing sustainability
Sustainability and its connotations
Green accounting and sustainability performance reporting
Shaping a more sustainable future for our companies
03 How do ESG values change Company culture?
Values, principles, and policies
Mission Statements
Codes of Conduct
Cultural awareness
Grievance management
Job descriptions
Use of expatriates
Your environmental team
Organisation and reporting relationships
Use of consultants
Embedding ESG values in the Company
04 ESG factors in project finance and M&A transactions
Pros and cons of international project finance
Working with equator principles financial institutions
Importance of risk management in our business
Project screening and categorisation
Role of lenders’ environmental and social consultants in environmental and social due diligence
Equator principles as example of private code of conduct
Covenants in financial agreements
The bigger picture
Key takeaways
05 Environmental and social planning and management: what’s measured improves
Key elements of proactive environmental and social management
Environmental and social business aspects
Proactive management means prevention
Plan for the unexpected
Documentation
Environmental and social management as continuous interlinked effort
Need for adaptive environmental and social management
Environmental and social management as bureaucratic approach to sustainability
06 Safety governance inside the boardroom
Directors and prison
Safety and environment
How mature is safety governance at your Company?
Policeman or doctor
Safety and systems
Preventing fatalities
The problem with LTIFR
The safety pyramid fallacy
Fatality prevention models
Golden rules
Work stress and corporate response
What you can do as a Board member
07 Impacts of development on communities: sharing benefits
Social impact assessment
Gender considerations
Indigenous peoples
Community concerns
Community aspirations and expectations
Conflicts
Community development
Selecting the social team
08 Access to land as a human rights issue
Land and human rights
Resettlement principles
Minimising need for resettlement
Attention to livelihood restoration
Managing resettlement
Allocating resettlement budget
Involvement of communities in land acquisition and resettlement
Cut-off date
Willing buyer/willing seller
Host communities
Land management solutions
Questions to ask
09 Water resources in the future: problems and solutions
Water scarcity
Water resource planning requires baseline data
Saving water
Smart water management
Protecting water
Standards and regulations
Offsets
Emerging contaminants
Source, save, and protect
10 Industry and biodiversity
Critical habitats and biodiversity impacts
Mitigation hierarchy to avoid and minimise biodiversity loss
Biodiversity offsets to achieve no net loss
Additional Conservation Actions
Alien invasive species
Biotechnology and genetic resources
11 Enterprise risk management: putting ESG risks into a business context
Political risk
Risk events
Risk scenarios
Scenario A – Cyanide Truck Collision
Scenario B – Sulphuric Acid Truck Collision
Risk assessment
Risk acceptability
Uses and limitations of risk scores
Role of Board in risk management
12 Environmental liabilities: risks beyond the balance sheet
Tailoring scope of environmental due diligence
Evaluating regulatory compliance in acquiring ongoing operations
What lies beneath – on-site contamination
Offsite contamination on former sites
Offsite disposal of hazardous wastes
In-migrating contamination
Building materials and indoor air quality
Emerging issues in environmental due diligence
Allocating environmental risks in transaction agreements
Environmental insurance policies
Environmental risks/liabilities reporting requirements – damned if do and damned if don’t
End of lease/tenement clean-up
13 Strategies for climate change risk management: stemming the tide
Climate change risks to industry sectors
Climate change opportunities for industry sectors
Energy and GHG emissions management
Climate variability in future
Climate change risks to operations
Company impacts on host communities and climate change
How companies commit to climate-proofing
14 Crisis management: don’t wait for a crisis to come up with a crisis plan
Crisis versus normal operations
Crisis management models
Scenario-based versus capacity-based model
Proactive versus reactive crisis management model
Issue and crisis management relational model
Incident command system model
Crisis management cycle
Crisis management systems
Crisis Management Plan
15 Right way to close an operation
Delay, closure, or sale?
Workforce redundancies
Closure process
Contractual provisions and Government requirements
Clean-up: key influences
Relinquishment of lease and permits
Long-term closure liabilities
Closure in the mining sector
Closure in the oil and gas sector
Other industries
Documentation
Our role as business leaders during closure
16 Looking ahead
Millennials
Gender and diversity
Environmental and social issues are the next phase of good governance
Accelerated climate action
Internet of Things and big data
Energy management
Relationship to plastic
Access to water
New technologies
Biodiversity as an emerging material risk
Extending green practices along the supply chain
Sustainability as competitive advantage
Appendix: managing catastrophic risk – tailings disposal
Acronyms and abbreviations
References
Index
