5 Ways Oracle Risk Management Cloud Can Help Manage ESG Governance and Audit

How do you plan to address Environmental, Social, and Governance (ESG) risk and compliance activities?  Or are you already doing this? Or, like most, are you starting to define what this actually means to you, your role, and the organization you work for?

Managing and planning for climate-related risk is no longer a “nice to have”, as legislation such as the SEC climate-related disclosure proposal and the Corporate Sustainability Reporting Directive (CSRD) are looming and gaining momentum.

Legislation such as these will require qualifying companies to report on items such as greenhouse gas emissions, climate goals, climate-related risks/risk management, and more.

To be proactive and efficient, companies will want to identify and mitigate climate, as well as other ESG -related risks within the framework of a robust and holistic governance and audit program.   Managing ESG separately leaves it disconnected from organization priorities. Instead, ESG-related risk management, audit testing, issue and remediation tracking should be prioritized in the context of Enterprise Risk Management (ERM) and Audit activities.

If you are working on this exciting, daunting, and extremely complex task, welcome to the club!  To assist you on this journey, there are a variety of features within Oracle Risk Management Cloud that can help streamline and automate governance, risk and control (GRC) activities, including around ESG governance and audit.   

Oracle Risk Management Cloud is part of the Oracle Fusion Cloud ERP family of applications. It helps streamline and automate risks and compliance activities to help organizations reduce risk while increasing efficiency.   

The purpose of this post is to highlight key capabilities within Oracle Risk Management Cloud that enable organizations to streamline GRC activities, reduce compliance fatigue and redeploy resources to focus on other strategic initiatives rather than manual governance compliance tasks.

1. Risk Analysis & Evaluation

What is it: This feature enables automated risk analysis using likelihood and impact scoring.

Why is it important: This enables organizations to quickly identify where the greatest risk lies in the business and where they may want to focus their GRC efforts, including around ESG risks.

2. Compliance Certifications

What is it: This feature enables organizations to send compliance questionnaires and surveys to individuals throughout the enterprise.

Why is it important: Organizations can engage different business functions involved with ESG, such as Finance, Supply Chain, Procurement, HR and more to drive awareness and capture feedback. These surveys and questionnaires can help track and assess progress on ESG initiatives for policy compliance.

3. Control Assessment & Testing

What is it: Internal control assessment functionality to determine if internal controls are operating as intended.

Why is it important: This feature helps automate internal control assessment activities to evaluate for compliance with internal ESG policies and procedures. Test results can be routed for review using workflow.

4. Advanced Audit

What is it: Proactive, ongoing advanced audit over access, transactions and configurations in Oracle Cloud ERP to identify possible issues.  

Why is it important: This feature allows organizations to proactively monitor for critical changes to ESG-related data in Oracle Cloud ERP. Changes to ERP data such as utility usage, supplier ESG scores and more can be automatically identified using advanced audit and routed for review all right in Oracle Cloud ERP.

5. Issue and Remediation Tracking

What is it: This feature enables organizations to assign issues owner related to compliance issues and track until remediation using workflow.

Why is it important: Users can identify, manage and remediate ESG compliance issues using simple work flow right in the same application the business is run on (Oracle Cloud ERP).

At Oracle, we like to say “Sustainability is everyone’s business” – especially when it comes to measuring and managing ESG activity. Oracle Risk Management Cloud provides a streamlined and automated approach to Governance, Risk and Controls, including ESG Governance and Audit.

For more information on Oracle Risk Management Cloud visit: https://www.oracle.com/erp/risk-management/

For more information on Oracle’s Sustainability efforts visit: https://www.oracle.com/sustainability/