The key to effective third-party ESG risk monitoring

It is now obvious that the theme of ESG is close to the top of most corporate agendas. Typically, companies will think about ESG from two perspectives: 1) measuring their own credentials, such as sustainability, ethical behaviour, etc. and 2) evaluating the investments they make. 

The relationship between ESG and supply chain due diligence 

However, corporations also recognise another angle—that the ESG misdeeds of the suppliers, representatives and partners they do business with might present a risk to them, by association. The impact of such third-party misdeeds could cause significant damage to brand reputation, share price and even sales.

How to develop an ESG risk framework to mitigate third-party risk

In order to know how to screen and monitor these third-party relationships, you need to know what those potential ESG misdeeds are or what bad ESG looks like, if you will. 

smartEYE’s ESG framework, which serves as a guide for our third-party risk monitoring product, smartEYE determines the specific transgressions that should be monitored for. And behind each of these risk concepts is a granular set of subcategories including synonyms, colloquialisms and a myriad of language permutations.

We don’t claim that is the definitive classification of ESG risk types. In fact, we would welcome a conversation on how it can be improved. However, when combined with the precision of our multilingual search and content processing technology, for example Russian, Chinese, and Arabic, smartEYE delivers third-party ESG risk alerts in real time, representing a powerful ally in the effort to maintain corporate wellbeing.

To see what 24/7 third-party risk vigilance looks like in action, please schedule a demo.