Traditional banking companies are still in the early stages of addressing environmental, social, and governance (ESG) related issues, including the reporting and disclosure of related performance. In fact, many financial companies are taking a slow, incremental approach and are looking for practical ways to infuse ESG thinking into their overall risk management programs—specifically focusing on evaluating their customer base, vendors, and third parties around ESG risk.
One reason for the slow, incremental approach is because regulators are just beginning to determine how companies should measure and report their ESG effort. In the meantime, proliferation of ESG related disclosure standards, frameworks, ratings, and rankings muddies the waters when it comes measurement and reporting options.
All of this means it’s a complex landscape when it comes to ESG for financial services companies. They must look at their own ESG performance, evaluate ESG risks, and perhaps even create ESG-related products.
KPMG LLP and Workiva are collaborating in the marketplace and have engaged in wide-ranging discussions with executives from leading financial institutions about how their organizations are addressing ESG in light of stakeholder, investor, and government expectations.
