Risk Management and Sustainability

This chapter proposes different approaches to monitor corporate sustainability which go beyond unstructured standalone corporate social responsibility (CSR) and sustainability programs. Historically, corporate sustainability has largely consisted in “stand-alone” sustainability programs that use publicly stated sustainability goals, independent sustainability initiatives, and sustainability reports. There has been little effort on the part of large corporations to stray from this model. The chapter focuses on companies’ integration of sustainability through the lens of risk management with the support of standards and operating management systems (OMS). First, the chapter examines the foundations of risk management and a systematic method to handle sustainability risks through the International Organization for Standardization (ISO) guidelines. It then explores the principles, framework, and processes to implement a risk management practice in accordance with the ISO 31000:2018 standard. It demonstrates how to integrate all the management systems that contribute to sustainable development into a single sustainable organizational model through the high-level structure of ISO management system standards presented in this chapter. After introducing the fundamentals of ISO standards and how they function, the chapter focuses on the standards dedicated to Sustainability and CSR. The chapter presents a “plan-do-check-act” (PDCA) model which is used for the control and continuous improvement of processes and products within an organization and can be employed for corporate sustainability. The chapter concludes that a key to success is to replace old unstructured sustainability programs with a new unique structured sustainability program that works best for each organization.