Learn how Resilinc’s ESG Risk Assessment can help your company proactively mitigate ESG risks hidden in your supply chain.
ESG (environmental, social, governance) is becoming increasingly important for supply chains across the globe. As governments introduce stricter ESG legislation related to environmental protection, labor rights, and corporate governance, companies must perform due diligence to avoid costly penalties and legal risks. For example, Volkswagen had thousands of cars impounded by U.S. customers under the Uyghur Forced Labor Prevention Act (UFLPA) due to one small electronic part that was linked to forced labor.
One of the biggest challenges is that businesses are also held accountable for their suppliers’ actions—multiple tiers deep in the supply chain. So, how can companies ensure their suppliers comply with ongoing regulatory demands? Using Resilinc’s new ESG risk assessment, organizations can quickly uncover hidden supplier ESG risks, collect valuable data, and manage it all from one comprehensive dashboard.
What is Resilinc’s ESG Risk Assessment?
Released on April 6, 2024, Resilinc’s ESG risk assessment is the latest addition to our Supplier Assessment Library. This centralized library houses numerous assessments from cybersecurity to business continuity planning (BCP). While the library already contains specific assessments for ESG legislation—such as the Uyghur Forced Labor Prevention Act (UFLPA) and the German Supply Chain Due Diligence Act—this ESG risk assessment serves as a broader rating for overall ESG risk.
After collecting ESG assessment responses, Resilinc will run analytics to highlight high-risk areas, calculate risk scores, and anticipate trends so companies can save valuable time and resources. This refined and ready-to-use data will then be available from a centralized dashboard, providing a quick view of where suppliers are at in their ESG journey.
Ensure Responses from Suppliers
It can be difficult to get suppliers to answer lengthy surveys and assessments. To add to the challenge, many suppliers claim to follow strict ESG principles but often do not have documented evidence of such practices.
Resilinc’s ESG risk assessment is designed to be easy for suppliers to complete. The survey includes as few as 82 questions structured into distinct categories to avoid overloading users with irrelevant questions. Some categories covered by the assessment are:
- Greenhouse gas emissions
- Water, waste, and chemical management
- Health and safety procedures
- Diversity, Equity, and Inclusion (DEI) Programs
- Conflict Materials
- Ethical Business Practices
Plus, the assessment only asks suppliers for the most crucial documentation. We only require attachments for items where industry-specific documentation or evidence of compliance processes are essential.
Customizable Questions with Adjustable Weighting
Procurement managers often require industry-specific ESG assessments to assess suppliers on unique points. Unfortunately, most assessment providers offer bulky, non-editable assessments with questions that are set in stone and cannot be customized. These other assessments typically run offline in Excel, which requires a more manual and less intuitive process.
Resilinc’s ESG assessments are easy to customize, all from one intuitive platform. Our ESG assessments are editable to ensure that they match the needs of each unique company and supplier. For example, supplier A may need a dedicated assessment focused on forced labor in the Xinjiang region of China, while supplier B needs a dedicated assessment for PFAS usage in the United States.
Before sending out the assessment, users can duplicate, add, edit, or remove questions. Users can also adjust the weight for each question. For example, imagine a company is tasked with decreasing greenhouse gas emissions across the supply chain. In this case, the company may choose to give high-greenhouse gas emissions a higher risk score since this is a priority.
Start Proactive ESG Risk Management Today
Using Resilinc’s ESG risk assessments, companies can be proactive and ensure compliance across the supply chain rather than paying fines for bad actors down the road. Through analyzing risk scores, companies can choose to work with suppliers that follow ethical practices and mitigate risks by finding alternative suppliers with high risk scores.
Companies can also use ESG assessments to vet new suppliers before onboarding them to the customer supply chain. Understanding a supplier’s ESG journey before signing a contract can help avoid compliance risks.
Discover how Resilinc’s RiskShield can help your company turn risk into opportunity.
