Our key takeaway: CFOs, if you haven’t been paying attention to the social impacts and risks of your business on people, now is the time to start! CFOs have a natural role to play in integrating human rights considerations into their role as monitors and managers of risk across the company. This information can feed into better internal decision-making and overall risk management. CFOs have a role to play in both helping to embed standards, policies and processes to address social issues, as well as measuring the effectiveness and robustness of outcomes. While many current reporting standards aren’t yet strong enough to assess these topics, CFOs can prepare for stronger standards and oncoming regulations by: (1) focusing on the actions and culture set by senior leaders and the board to embed commitments into practice; (2) improve the quality of risk identification and assessment, where there are gaps; (3) assess the extent to which identified risks and corresponding actions are actually driving real behaviour change; (4) setting robust and credible targets and KPIs, both quantitative and qualitative; (5) focusing on on inequality-related metrics when evaluating outcomes in the workplace; and (6) seeking to integrate perspectives of workers and other affected stakeholders into risk monitoring and measurement.
The World Business Council for Sustainable Development (WBCSD) and Shift published Advancing the “S” in ESG: A Primer for CFOs (March 2023):