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Legal, Risk and Compliance Officers

Integrating ESG into governance, risk and compliance systems

Legal, risk and compliance teams now face ESG requirements layered onto already mature systems — across multiple jurisdictions, with boards, auditors, and regulators all expecting clear answers.

Understanding what the rules require is rarely the problem.

The difficulty lies in demonstrating defensible, repeatable processes: ensuring sustainability-related risks sit within the same governance structures as other enterprise risks, that controls and documentation withstand assurance scrutiny, and that accountability rests with the functions that can actually influence outcomes.

We help organisations integrate ESG requirements into existing governance, risk and compliance frameworks.

Ownership is distributed across functions, escalation works as intended, and sustainability compliance becomes a natural outcome of strong governance and risk management — not a separate, parallel system.

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How do you design due diligence systems that meet legal expectations and work in practice?

What the law requires
Human rights and environmental due diligence laws — including the EU Corporate Sustainability Due Diligence Directive (CSDDD), the EU Forced Labour Regulation and national Modern Slavery Acts — require organisations to demonstrate structured, risk-based processes across their operations and value chains.

These regimes generally establish obligations of means, not outcomes. Organisations are expected to take reasonable, proportionate steps to identify, prevent, mitigate and address adverse impacts — and to be able to demonstrate how those steps are designed, applied and reviewed over time.

Where implementation typically breaks down
For legal, risk and compliance teams, the main concern is usually how these standards are translated into operating reality.

This typically centers around:

how risks are identified and prioritised across complex value chains,
how responsibilities are embedded in procurement and other business processes,
how actions are documented and monitored, and
how persistent issues are escalated through governance structures.

When these elements are designed in isolation, due diligence becomes fragmented. Effort and documentation increase, but ownership weakens, risk insight remains limited, and systems become difficult to defend, maintain or scale.

Human Rights and Environmental Due Diligence

Designing due diligence that works in practice
We support organisations in designing and implementing due diligence systems that align legal requirements with existing governance, risk management, procurement and operational processes.

Our approach is grounded in the OECD Guidelines for Multinational Enterprises and the UN Guiding Principles on Business and Human Rights, which underpin most human rights and environmental due diligence legislation.

The focus is on pragmatic, proportionate and risk-based systems that function within day-to-day decision-making — not parallel compliance structures.

This means working through existing business processes, clarifying how risks are identified, prioritised and addressed, and ensuring documentation, monitoring and escalation are built into established controls.

The result is due diligence systems that are designed to operate consistently over time and under real business and regulatory pressure, without relying on theoretical compliance or standalone structures.

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Why materiality assessments matter for disclosure

Materiality assessments determine which information an organisation is required to disclose, and at what level of detail. For multinational organisations, disclosure obligations vary by jurisdiction. Some regimes require full double materiality assessments, while others remain centred on financial materiality, with additional impact-related considerations introduced through regulation or sector-specific standards.

A strong foundation that can be used with flexibility
A well-designed double materiality assessment provides the most complete and structured overview of sustainability-related risks and impacts across the business and value chain. It creates a common analytical baseline: where external developments may affect financial performance, where impacts on people and the environment are most significant, and how these dimensions interact over time.

For legal, risk and compliance teams, the task is applying jurisdiction-specific disclosure requirements to a consistent underlying assessment — and being able to explain which topics are in scope, why they are in scope, and how those judgements are applied consistently across jurisdictions, business units and reporting cycles

Double Materiality Assessment

We support organisations in designing and conducting double materiality assessments that do both:

provide a robust, defensible basis for disclosure decisions, and
function as a structured input into risk management and strategic oversight.

Our work focuses on:

structuring credible and proportionate stakeholder engagement, including customers and other key business partners,
applying transparent prioritisation criteria that distinguish disclosure-relevant topics from contextual signals, and
embedding outcomes into governance, risk management and internal control frameworks.

Designed this way, materiality assessments anchor disclosure decisions in documented judgement, while also acting as a strategic radar — highlighting where impact-related issues may translate into future risk, legal exposure or business constraints.

This strengthens consistency across reporting cycles, clarifies where assurance-level controls apply, and supports informed oversight over time.

Ensuring coherence between materiality, due diligence and risk management

Materiality assessments, human rights and environmental due diligence, and enterprise risk management are frequently developed as separate processes. They use different scopes, definitions, review cycles and governance arrangements, even though they increasingly address overlapping issues.

Disconnected risk processes can unintentionally lead to gaps
When these processes run in parallel without clear connection, organisations struggle to form a coherent view of exposure. Similar risks get assessed using different criteria, escalated through different channels, or reviewed on different timelines. Important issues can fall between the cracks — particularly where sustainability-related concerns evolve from impact issues into legal, operational or financial exposure.

Risks identified through materiality assessments and due diligence should be assessed, monitored and escalated through the same governance and decision pathways as other enterprise risks, using language, thresholds and controls the organisation already applies elsewhere.

Integrated Risk Management

We help organisations connect materiality assessments, enterprise risk management and human rights and environmental due diligence into a coherent risk system.

This includes, where feasible:

aligning risk definitions and severity criteria across processes,
coordinating review cycles and information flows,
clarifying escalation thresholds and decision points, and
ensuring risks identified in different processes are treated in a consistent way.

The objective is not to create a single, uniform methodology, but to ensure that different risk processes speak to each other.

When connected, organisations gain a more complete and comparable view of threats and opportunities. Risks are assessed using familiar risk management language, escalated at the right level, and governed with the same discipline as other enterprise risks.

This reduces duplication, strengthens oversight and improves defensibility — while allowing different processes to continue serving their specific legal and operational purposes.

Legal, Risk and Compliance Officers

Integrating ESG into governance, risk and compliance systems

Connected insights

How do you design due diligence systems that meet legal expectations and work in practice?

Human Rights and Environmental Due Diligence

Your time is valuable

Why materiality assessments matter for disclosure

Double Materiality Assessment

Ensuring coherence between materiality, due diligence and risk management

Integrated Risk Management

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