ESG Due Diligence services
Due diligence on ESG measures is now being considered to a greater extent, with sustainability matters playing a larger role in transactions and investments. The EY team can help organizations identify actual and potential ESG risks affecting business performance throughout the value chain, on both buyer and vendor sides.
What EY teams can do for you
As sustainability and ESG become increasingly crucial in business operations, companies are facing a growing responsibility for ESG throughout their business and value chain. Consequently, due diligence on ESG is essential in investments and business transformations. It’s important to consider actual and potential ESG impacts on transactions, operations and supplier relations.
ESG impacts are more significant in companies’ supply chains. The focus is prominent in transactions, where ESG due diligence is gaining momentum alongside financial due diligence in mergers and acquisitions (M&A). Furthermore, due diligence on potential suppliers and investors plays a larger role in risk management, identifying potential reputational and financial ESG-related risks.
In Denmark, there has been an increased focus on companies’ work within human rights. This is solidified by the reporting requirements for social responsibility outlined in Section 99a of the Danish Financial Statement Act. Other countries have implemented separate reporting requirements related to human rights — such as the UK Modern Slavery Act in England, the Duty of Vigilance law in France, Norwegian Transparency Act, and the upcoming Corporate Sustainability Due Diligence Directive (CSDDD).
EY teams can help your business identify risks of negative impact on ESG across your value chain and provide support to mitigate the related financial and reputational risks. We can assist in developing policies, help in implementing due diligence processes to both monitor and address risks on an ongoing basis, and develop appropriate mechanisms to address breaches within general ESG or specific areas such as human rights.
We can help develop structured and risk-based systems and processes for responsible supplier management, and assist with audits of suppliers, helping businesses:
- Prevent, mitigate or cease actual or potential risks.
- Increase corporate accountability.
EY teams bring together professionals with experience in business, engineering, science and operations, and offer services to assist with the following:
- Conduct due diligence on both buy and sell-side.
- Develop code of conducts for suppliers.
- Audit of suppliers.
- Develop due diligence processes in line with the OECD Guidelines.
- Identify risks in the supply chain, including those related to human rights.
- Help implement UN Guiding Principles for Business and Human Rights and human rights due diligence processes.
- Conduct master classes on UN Guiding Principles for Business and Human Rights.
- Assist with communicating and reporting on human rights.
- Advice on legal requirements on sustainable finance.
- Preparation of value chain analysis.
