Kwantis has launched a new project for an international player in the engineering, general contracting and project development sectors. By embedding ESG risk management within the corporate structure, the company can improve decision-making processes, ensure regulatory compliance, and strengthen its overall risk resilience.
Integrating ESG Risks into Construction Risk Management: Ensuring Compliance and Sustainability Alignment
The main objective of this ESG Risk Assessment is to integrate Environmental, Social, and Governance (ESG) risks into the existing risk management framework of the construction company. This integration is designed to ensure not only better risk management but also alignment with important regulatory standards and sustainability initiatives. The specific goals include:
- Enhancing compliance with ISO 9001:2015 standards and the European Corporate Sustainability Reporting Directive (CSRD).
- Aligning the risk analysis with material topics identified in the Sustainability Report to reflect key areas of environmental and social impact.
Methodology for ESG Risk Integration: Gap Analysis, Stakeholder Engagement, and Risk Register Enhancement
To integrate ESG risks into the company’s risk management framework, a structured methodology was applied. First, a comprehensive Gap Analysis identified ESG risks, such as environmental, social, and governance factors, that were not addressed by the existing system, ensuring all relevant risks were incorporated into the risk register. Next, stakeholder interviews, involving employees, management, clients, and external partners, were conducted to gather diverse perspectives on potential risks and opportunities, providing a holistic approach to ESG risk management. The Risk Register was then updated following ISO 31000:2009 guidelines, which included assessing risks both before and after implementing mitigation strategies. To facilitate the tracking of risk management efforts, a Risk Matrix was developed, offering a visual representation of risks before and after treatment, helping to clearly communicate the severity, likelihood, and overall impact of each risk on business objectives.
Phased Implementation of ESG Risk Assessment: Identification, Evaluation, Treatment, Monitoring, and Reporting
The ESG Risk Assessment followed the company’s Corporate Risk Management procedure across five phases. First, ESG risks—environmental, social, and governance—were identified, focusing on those impacting business objectives. Each risk was then evaluated by its impact and likelihood, prioritizing those with significant effects on sustainability, compliance, or operations. For high-priority risks, tailored mitigation strategies were developed, such as improving environmental controls or governance policies. An ongoing monitoring process ensured risks were tracked and treatment plans adjusted. Finally, findings were reported to senior management and the board, highlighting key risks, mitigation effectiveness, and changes in the risk profile.
Aligning ESG Risks with Global Standards: A Path to Compliance and Sustainable Growth
The successful integration of ESG risks into the existing risk management framework strengthens the company’s ability to respond to evolving challenges in environmental, social, and governance areas. Through gap analysis, stakeholder engagement, and adherence to ISO 31000:2009 standards, the company has enhanced its resilience and compliance with global sustainability directives, such as ISO 9001:2015 and the European Corporate Sustainability Reporting Directive (CSRD).
This ESG Risk Assessment not only ensures improved regulatory compliance but also aligns the company’s risk management efforts with long-term sustainability goals, enhancing both operational stability and its reputation as a responsible, forward-thinking construction company.