Environmental, Social & Corporate Governance (ESG)
ESG concerns are playing an increasing role in corporate decision-making – offering both risks and opportunities.
Across many industries, global climate change and extreme weather events are heightening operational risk. Consumer demand is prompting companies to examine their carbon footprint and to expand diversity in their workforce, leadership and boards. And investors and other stakeholders are calling for increased transparency and accountability.
To mitigate risk and leverage opportunities, you need a legal team that is on top of changing legislation and ESG best practices in Canada and internationally.
With a multidisciplinary perspective and deep regional and industry knowledge, the MLT Aikins ESG group can help you anticipate legislative changes and understand how they may impact your business.
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What is ESG and why does it matter?
ESG is a tool that assesses an organization’s societal and environmental impact using non-financial criteria. Investors and financiers may use ESG metrics to screen and rank investments, guiding capital allocation.
Examples of ESG considerations:
- Environment: Carbon footprint, deforestation, pollution, resource use, waste and water, sustainability
- Social: Community impact, DEI, human rights, labour practices, pay equity, Indigenous engagement
- Governance: Board diversity, corporate governance, ethics, executive pay, regulatory compliance, taxation approach
With the rise of sustainable investing and financing and move toward mandatory ESG disclosure, it’s critical for companies to have a clear ESG strategy that identifies risks and opportunities for continuous improvement.
Modern slavery legislation is now in force in Canada and requires certain businesses to report on their efforts to prevent and reduce the risk of forced labour and child labour in their supply chains. Our lawyers can help you assess your reporting obligations, evaluate your current governance structure and prepare your report.
Depending on the nature of your business, you may also be required to provide such information to other companies to which you provide goods or services. MLT Aikins can help you prepare for and respond to these requests.
Additionally, we can advise your organization on the potential risks and benefits of voluntary disclosure.
With deep knowledge and experience in a variety of industries, including agriculture and food, manufacturing, financial services, public sector, energy, transportation, mining and natural resources, and entertainment and media, our team can provide detailed advice and help you consider implications specific to your organization and region.
Centralized and thorough corporate policies and procedures addressing ESG issues are critical to managing ESG risks. Once developed, these policies and procedures provide guidance for consistent prioritization, management and reporting on ESG issues. Policies and procedures can help ensure that employees are informed and engaged in your corporate values and priorities, and are also key tools in ensuring compliance with applicable laws and regulations.
Examples of ESG-related policies and procedures include:
- Supplier code of conduct
- Corporate governance policies
- Whistleblower policy
- HR policies and best practices
- Diversity, equity and inclusion (DEI) policy
- Indigenous engagement policy
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