Taking place at RAI Amsterdam on September 27 and 28, #RISK Amsterdam examines the trends and best practices organisations are employing to navigate today’s rapidly evolving risk landscape.
Richard Stratmann is Director of Enterprise Risk Management (ERM) and ESG at Bruker Corporation. An experienced leader, Richard’s background combines finance expertise with a deep understanding of ERM and ESG practices.
Richard will be at #RISK Amsterdam to discuss measures that businesses must take to cut through the noise and make a real impact with ESG strategy.
Five “musts” to implement an ESG culture - Wednesday 27th September, 15:40 - 16:20pm (CEST) - Privacy, Security & ESG Theatre
Richard talks about his professional journey below, and introduces the key themes in his #RISK Amsterdam panel debate.
Could you please outline your career pathway so far?
I began my career at the age of 17 with a strong interest in Environmental, Social, and Governance (ESG) issues, always remaining within finance functions. My journey started as an external auditor at KPMG, where I focused on controlling and auditing. Over five years, I transitioned to a role at Fiat Chrysler, specialising in commercial finance and controlling.
Almost nine years ago, I made another significant move, joining JDE Peet’s, the world’s largest pure play coffee company, again in several finance leadership roles. Throughout my career, I’ve consistently been involved in supply chain finance functions, including overseas assignments, where I managed operations after an acquisition in the Asia Pacific region and served as the head of finance for procurement.
However, as I gained global exposure, I discovered a growing interest in social and environmental issues, and this prompted me towards ESG. What fascinates me most is that many organisations primarily focus on minimising negative impacts, while the company I now work for actively contributes to society and conducts research on environmental issues, creating a positive narrative.
This transition from finance to ESG and risk management allows me to work for a company (Bruker) that genuinely impacts the world in a positive way, aligning my career with my passion for making a meaningful difference.
Are ESG issues being talked about enough in the Boardroom?
In my experience, it’s never enough when it comes to ESG (Environmental, Social, and Governance) initiatives. I’ve observed various companies at different stages of ESG maturity, and it often starts with a financial perspective.
The importance of ESG increases as financial risks become more significant. If there’s a financial benefit, companies are more likely to prioritise it. However, even in organisations making a positive societal impact, the ESG framework may not be adequately integrated.
There’s always room for improvement, even when contributing positively to society; there’s potential for companies to do more in the realm of ESG.
What steps do companies need to move the ESG discussion up the priority list?
ESG is a broad topic, encompassing a multitude of aspects within an organisation. Attempting to tackle all ESG aspects simultaneously can be overwhelming, making it crucial to start by identifying the most relevant topics for your firm. This process should be inclusive, involving input from across the company.
Often, there is a disconnect between what C-suite executives deem important in the ESG arena and the perspectives of operational staff. For instance, diversity and inclusion may be key areas of focus for many years, yet the representation in the C-suite might not reflect this reality.
To bridge this gap, it’s essential to identify important ESG topics inclusively, involving the entire organisation in the decision-making process. This helps align priorities with the organisation’s broader objectives, integrating ESG considerations into the overall strategy.
When it comes to implementing ESG, particularly in social elements, the emphasis should be on the “how.” This entails seamlessly integrating ESG into the existing corporate strategy rather than treating it as a separate function.
Senior management and the C-suite play a vital role in embedding ESG into day-to-day operations; it should become an inherent part of the organisation’s management and decision-making processes, ensuring clear accountability for ESG-related decisions at all levels of the organisation.
In essence, ESG is not just a set of objectives; it is a fundamental part of the company’s culture and practices, where differences can be made by making ESG integration an integral part of how decisions are made and actions are taken.
How can companies avoid the checkbox mentality and ensure authenticity when pursuing ESG goals?
There is growing societal and governmental pressure on all companies to have an ESG strategy, which can sometimes lead to scepticism. All companies are expected to have ESG strategies, although the impact of some firms on the environment might be limited.
While this may seem insincere, it’s driven by a framework that mandates reporting on environmental progress and includes ESG considerations in supply chain risk management analysis.
It’s important to strike a balance between holding companies accountable and not overwhelming them with unrealistic targets and KPIs. Companies should assess whether participating in ESG initiatives aligns with their values and capabilities. Without some level of pressure, companies may not even make minimal efforts in this direction.
Maintaining authenticity is paramount, especially in a world where greenwashing is a concern. Furthermore, companies should avoid exaggerating their achievements and focus on presenting factual information. While marketing can play a role in crafting a narrative, it should always align with the truth. The movement towards limited or full assurance on claims made by companies is essential to ensure transparency and trust.
To create a common understanding and certification of ESG efforts, there is a need for a universally accepted language and standards. This would provide a consistent framework for evaluating and comparing companies’ ESG performance, ensuring that their intentions and actions align with genuine efforts to make a positive impact on society and the environment.
What are the major challenges that organisations are facing as they bid to improve ESG culture?
The ESG topic may be relatively new for many senior management professionals, making it challenging to fully grasp its nuances and establish priorities. Unlike the straightforward understanding of profit and loss, ESG is multifaceted and may elude those without a background in it or operational experience within organisations that emphasise ESG principles.
One of the complexities surrounding ESG lies in the lack of standardisation across the board. Additionally, the absence of a common language for assessing ESG efforts, as well as the varying levels of assurance regarding the claims made by organisations, further complicates matters. Relying solely on competitors’ sustainability reports or press releases to comprehend ESG practices is insufficient.
Balancing an effective ESG strategy requires different calls for the various layers within an organisation to be aligned. Younger generations, particularly those who have studied topics like responsible business, are increasingly driving the ESG conversation. Their concerns and perspectives should be incorporated into ESG strategies, as they will occupy leadership positions in the future.
Listening to the voices of these younger generations and accommodating their views is vital – their insights can help shape a more comprehensive and future-proof ESG strategy. These individuals will play a significant role in the years to come, making it crucial for organisations to prepare and adapt to the evolving landscape of ESG, ensuring that they remain in sync with both emerging trends and societal expectations.
In every activity, there are the “musts”, the things you absolutely must do if you’re going to make an impact.
In this session, our ESG experts will give five key takeaways that organisations of any stripe and size can put into practice today.
Also on the panel:
- Adriano Martins, Head of Global Logistics ESG, The Kraft Heinz Company
- Rutger Veenstra, Compliance Officer, Anker Insurance Company
- Irina van der Hoorn, Sustainability Lead, Asahi Europe & International
- Session: Day 1, Five “musts” to implement an ESG culture
- Theatre: Privacy, Security & ESG Theatre
- Time: 15:40 – 16:20pm (CEST)
- Date: Wednesday 27 September 2023
#RISK Amsterdam unites thought leaders and subject matter experts for a deep-dive into organisational approaches to handling risk. Content is delivered through keynotes, presentations and panel discussions.
#RISK Amsterdam is also available on-demand for global viewing.