Dan Zitting, CEO of Galvanize (now Diligent), is back on this week’s episode of the ESG Report. He and Tom Fox check in about the progress of his company’s M&A with Diligent, reporting on ESG to the board, and ESG trends for 2022.
Becoming Diligent
Dan tells Tom how Galvanize’s M&A with Diligent is progressing. “We’ve had a big year,” he says. Galvanize being part of Diligent means that they can now bring a truly integrated GRC solution from the board to the front line. “We are working really hard on technology capability that brings what GRC professionals do directly into the boardroom,” Dan remarks. “…We’re creating the ability to say, ‘Hey, alongside that board book sits information dashboards and information and analytics about how other areas of governance and risk and compliance in the front line are working’.” Real-time reporting on ESG will help the board engage in governance more proactively, he comments.
Tom asks how the acquisition strengthens Galvanize. We have the opportunity to elevate our work all the way to the boardroom, Dan responds. Also, Diligent’s global scale means that Galvanize now has access to more resources and a bigger client market.
The Proactive Approach
What are some of the key changes you’ve seen in the GRC space, Tom asks Dan. 2021 has accelerated progress toward an integrated risk management approach, he replies. Global pressure to take ESG seriously has also spurred this on. Both Tom and Dan agree that companies need to be nimble enough to pivot in anticipation of rapid change. “Traditional approaches just don’t work,” Dan points out. “If the way we’re going to evaluate these events is by auditing past history or looking at how we complied with controls in the past, it’s just not good enough anymore.” The better, more proactive approach to risk management involves using leading indicators rather than historical auditing activity. He describes how an automated GRC platform can help companies achieve this goal. We encourage our clients to think about creating structures and systems rather than just focusing on the software as the solution, he tells Tom.
Reporting to the Board and ESG Trends
“Particularly on ESG topics, the board is looking for the answers to simple questions,” Dan advises. Keep your report to just 5 points and their relevant benchmarks. Currently, two hot topics boards want to know about are carbon emissions and gender diversity. Dan believes the conversation will expand to other issues in the coming years, and that we’ll see ESG becoming more important throughout the organization. “I think a lot of organizations are going to be setting up a sustainability function that will ultimately have responsibility for doing that kind of accounting. We should be concentrating on that and then in turn connecting it to standards and compliance programs which is exactly what we know how to do as GRC professionals,” he remarks.
Dan shares his view on ESG trends for 2022 and beyond. The rapidly increasing pay rate for GRC professionals is a sign of how important and necessary this role has become. Boards and audit committees are also asking more questions and looking for guidance on ESG. That’s a good indication of what’s to come, Dan says.
Resources
Dan Zitting on LinkedIn | Twitter
Diligent Institute
