How do you audit sustainability risks?

1 Define the scope

The first step is to define the scope of the audit, which means determining the objectives, criteria, and boundaries of the assessment. The objectives should align with the organization's sustainability strategy and goals, as well as the expectations of its stakeholders. The criteria should include the applicable laws, policies, guidelines, and best practices for sustainability. The boundaries should specify the time period, geographic area, and operational units covered by the audit.

2 Gather the data

The second step is to gather the data needed to evaluate the organization's sustainability risks. This may involve reviewing documents, conducting interviews, surveys, or site visits, and collecting quantitative and qualitative information from various sources. The data should be relevant, reliable, and sufficient to support the audit findings and recommendations. The data should also be organized, analyzed, and verified for accuracy and completeness.

3 Assess the risks

The third step is to assess the risks based on the data collected. This means identifying the sources, causes, and consequences of the potential sustainability impacts, as well as the likelihood and severity of their occurrence. The risks should be prioritized according to their significance and urgency, and categorized into environmental, social, and governance aspects. The risk assessment should also consider the organization's existing controls, mitigation measures, and opportunities for improvement.

4 Report the results

The fourth step is to report the results of the audit, which means communicating the findings, conclusions, and recommendations to the relevant stakeholders. The report should be clear, concise, and consistent, and follow the agreed format and structure. The report should highlight the main strengths and weaknesses of the organization's sustainability performance, as well as the gaps and risks that need to be addressed. The report should also provide evidence and rationale for the audit opinions and suggestions.

5 Implement the actions

The fifth step is to implement the actions based on the audit recommendations, which means taking the necessary steps to improve the organization's sustainability performance and reduce its risks. The actions should be specific, measurable, achievable, relevant, and time-bound, and assigned to the responsible parties. The actions should also be monitored, evaluated, and documented for their effectiveness and impact.

6 Follow up the audit

The sixth and final step is to follow up the audit, which means checking the progress and outcomes of the actions implemented, as well as verifying the compliance and performance of the organization. The follow-up may involve conducting a post-audit review, feedback session, or survey, and updating the audit report and records accordingly. The follow-up should also identify the lessons learned, best practices, and areas for further improvement.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?