Mandi McReynolds, the Global Head of ESG in Workiva, joins the show to discuss how tech solutions have made ESG reporting easier, what organizations should consider before investing in tech, and the significance of putting stakeholders at top priority, and the future of tech in ESG.
▶️ Simplifying ESG with Thomas Fox & Mandi McReynolds:
Key points discussed in the episode:
✔️ Mandi McReynolds emphasizes communicating with your stakeholders to identify your company’s societal and business values. Stakeholders consist of internal, external, and customers.
✔️ Mandi McReynolds describes how Workiva simplifies the ESG reporting process.
✔️ Internal controls are the backbone of an effective ESG program. To create processes that stakeholders can trust, have different subject matter experts to add value to the discussion.
✔️ Look at the business value drivers and societal impact value drivers of your ESG plan. Before investing in tech and talent, identify your strategic value in materiality assessment and assessment engagement.
✔️ Bring a holistic picture of what your stakeholders care about regarding ESG.
✔️ How financial value has always been intrinsically linked to ESG reporting.
✔️ Find the balance between achieving your ESG commitments and not burning dollars.
✔️ Mandi McReynolds gives her predictions on the future of the technological component of ESG.
Mandi McReynolds is an award-winning author, educator, and practitioner-scholar. She has spent her career building corporate responsibility and environmental, social, and governance divisions across four different industries. Mandi serves as the Senior Director, Environment, Social, and Governance at Workiva. McReynolds is the co-editor and co-author of Diving Deep in Community Engagement: A Model for Professional Development. She received her B.A. in Organizational Communications from Cedarville University and M.S. in Interdisciplinary Studies: Speech Communication, Women Studies, and Higher Education from Iowa State University. She enjoys swimming and playing volleyball with her daughter, Ava, and traveling with her husband, Adam.
Resources
Learn more about Workiva – ESG reporting made simple – https://www.workiva.com/.
Mandi McReynolds on LinkedIn
ESG Talk Podcast
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Alan Saquella is a fraud risk practitioner as well as a Certified Protection Professional and Certified Polygraph Examiner. He currently works as a full-time professor at the Embry-Riddle Aeronautical University where he teaches security, intelligence, and fraud investigation in the business world. Tom Fox welcomes him to this week’s show to talk about how the corporate security world and fraud investigation intersect and form a union, and how this union helps to build a more effective fraud prevention program.
The Plague Upon the Corporate World
Tom wants to know how big an issue fraud and corruption are in the corporate world and how they manifest themselves. Alan believes that the statistics in the ACF report are not a true representation of fraud taking place in the real corporate world. He states, “Whether you’re a private company or publicly-traded company, there’s a lot more that goes on that’s never reported.” He remarks that the report claimed that about 50% of fraud cases are prosecuted or brought to the prosecution. From his work, he understands that less than 5% of cases are actually brought to the prosecution. With regard to corruption, Alan says that for some companies in and outside of the United States, “corruption and bribery are just part of doing business” so it will continue to flourish. Organizations usually bury cases of fraud or corruption, as they can be damaging and embarrassing to the brand’s public image and reputation. Additionally, fraud and corruption are white-collar non-violent crimes, which is why they are not taken seriously by the organization.
The Dilemma of Whistleblowers
According to the report, the ideal way to detect fraud in your organization is internal reporting, also known as whistleblowing. The government also suggests that the primary element of successful anti-corruption compliance programs are whistleblowers. Tom asks Alan if he agrees with these proposed ideas. Alan cautions, “I’ve seen it used very effectively in some organizations and not so much in others … I think all corporate investigative folks will agree it’s a key element to a fraud prevention program. Where I found it to be most successful is when it’s highly publicized.” Companies that do not advertise their fraud whistleblowing hotline are less likely to get tips, as potential whistleblowers feel less confident in reporting any indiscretions.
Fraud Prevention
Tom asks Alan what he thinks are the key elements of a successful fraud prevention program. Alan explains that even though whistleblowers are the most effective way to curb fraud in the workplace, companies must also look at the way they conduct business internally. “For example, tying bonuses to individual performance is always a risky endeavor. It tends to cause folks to take those chances and they’re right down the fence in that gray area,” he cautions. Alan advises that companies should reward based on group performance, to prevent desperate employees from committing fraud to get ahead. Additionally, companies ought to communicate with high-risk groups about fraud and fraud prevention. Alan explains that groups like sales and accounting tend to be most active in the fraud area. He also suggests that behavior-based surveys are one of the most effective programs in fraud prevention. These types of surveys give a lot more useful information than opinion surveys and it also “calls out the whistleblowers instead of waiting for the whistleblower to get to that point where they’re frustrated.”
Resources
Alan Saquella | LinkedIn | Embry-Riddle Aeronautical University
Welcome to a blog post series on Exiger’s fight to secure supply chains, sponsored by Exiger LLC. In this series, we will explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management. In Episode 2, I visit with Kim Lee, Associate Managing Director who focuses on risk and compliance, and Nick Wildgoose, a Consultant at Exiger. We discuss supply chain issues in the manufacturing and consumer markets.
We began with some of the key challenges in this sector. First, the manufacturing sector is incredibly diverse. It can be from electronics, automotive, clothing, and food, which are all vastly different, but a common denominator is the need to be cost-efficient. This makes cost-efficiency relevant to all in the supply chain. Over the past few years, Lee noted that she has seen supply chains in manufacturing and consumer sectors challenged “like never before with well-accepted practices put to the test.”
Moreover, from the macroeconomic perspective, COVID restrictions have disrupted every part of our supply chain, including air, ocean, and land freight, resulting in shortages.
Further, there have been factory shutdowns and labor shortages, which have impacted supply chains. The second type of macroeconomic factor is geopolitical. “The Russian invasion of Ukraine Russia is front and center of everyone’s mind, but there are also the China-US trade wars. In Australia, there are growing tensions between Australia and China, which has resulted in shortages in the supply chain to different degrees. These have been striking at the heart of the entrenched supply chain policy of centralizing distribution.”
Wildgoose noted that while most supply chains had responded to these issues, additional costs have been associated with the results. One of the biggest challenges is the cost of more thorough due diligence in looking at supply chain partners below tier one. This means understanding the multi-tier nature of your supply chain is critical. Before COVID-19, the only criteria was generally cost. But was, Wildgoose noted, “Suddenly COVID comes along, and you can’t operate your manufacturing lines, your consumer, sector stores without PPE, and suddenly it’s become strategic. It would be best if you also reassessed your risk management aspects. I think the other thing that companies have realized is that they need technology and data to look at this better, bring together the silos across the organization, and link up their approaches.”
Lee added that it is “a perfect time now for organizations to revisit their supply chain, risk management framework and ensure that it is fit for purpose, well communicated and understood.” This will help organizations in the current geopolitical environment manage the increasing expectations from consumers and regulatory expectations that continue to be challenging factors for manufacturing and the consumer sector. She added, “does your organization understand how far down the supply chain they have evaluated risks?”
Moreover, your organization should have a clear framework that sets out what you want to achieve. This should incorporate your risk appetite and tolerances, particularly in countries with a high perception of corruption. Other key risk areas include modern slavery and resilience, and operational efficiency. Having such a framework is important to ensure that everyone in your organization understands where the company stands and how to approach a supply chain risk management program consistently and coherently. Lee raised another issue which is around technology. The effective use of technology is fundamental to the success of your supply chain risk management program. With thousands of suppliers, you need to understand your risk profile.
We concluded by looking down the road at where supply chain risk management for manufacturers might be headed. The risks in this area are expanding. It could be cyber-attacks directed at your organization through a supply chain or ransomware claims which could bring your organization to a grinding halt by depriving your organization of key raw materials. Another key area is around climate change reporting risk, aka climate risk, from a supply chain point of view in the consumer and manufacturing sectors. Wildgoose said, “somewhere between 80 to 90%, quite often, of an organization’s carbon footprint is in its supply chain. Unless you understand your multi-tier exposure, how are the CEOs standing up to say, they’re going to achieve a net-zero?” Additionally, the financial community is looking at more disclosures around the impact of climate risk on companies. Indeed, the investment community, such BlackRock, Inc., have said that “sustainability is a competitive material issue that needs to be addressed as well.”
Join us tomorrow as we spotlight supply chain issues in IT and telecommunications.
Resources
Kim Lee Profile
Nick Wildgoose Profile
Exiger Website
Exiger’s Supply Chain Explorer
Categories
Episode 124 – J.S. Nelson
In this episode of The Ethics Experts, Nick and Gio welcome J.S. Nelson. Nelson is an expert on corporate scandals, fraud and unethical behavior, and a law professor at Harvard Business School. Nelson’s new book, Business Ethics: What Everyone Needs to Know, released on April 29th.
Welcome to a podcast series on the fight to secure Supply Chains, through cross-industry innovation. This series is sponsored by Exiger. In this series, we will explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management.
Over this series, I visit with Erika Peters, Senior Vice President and Global Head of Third Party & Supply Chain Risk Management; Tim Stone, Senior Director, Supply Chain Risk Management for Exiger Federal Solutions; Kim Lee, Director who focuses on risk and compliance; Nick Wildgoose, a Consultant at Exiger; Skyler Chi, Director and Deputy Head of Supply Chain and Third-Party Risk Management; Andrew Lehmann, Associate Director at Exiger; Jennifer Nestor, Vice President at Exiger, Americas and Public Sector; Theresa Campobasso, Senior Director for Defense Programs; Dan Banes President of Commercial Technology, and Mark Henderson, Director of Solution Design Lead.
In this episode 1, we discuss Supply Chain issues in the healthcare industry with Erika Peters and Tim Stone. Highlights of this podcast include:
- Key challenges for Supply Chain Risk Management in healthcare;
- Lessons learned from Covid-19 on Supply Chain in healthcare; and
- The evolving areas for Supply Chain Risk Management in healthcare.
Resources
Erika Peters Profile
Tim Stone Profile
Exiger Website
Exiger’s Supply Chain Explorer
Tom Fox welcomes Jules Oringel as his guest this week, and she may have the most unique story that’s ever been shared on The ESG Report. Jules is a second-year student at UNC where she double majors in Business Administration concentrating on ESG, Sustainability and Human Organizational Leadership & Development, with a minor in Public Policy. She’s here to talk about her passion for ESG and sustainability, and the road to pursuing it as a professional career post-grad.
Entering the World of Sustainable Development
Tom asks Jules what led to her studies at UNC. Jules explains that in 2018, after losing a loved one in the tragic shooting at Marjory Stoneman Douglas High School in Parkland, Florida, she founded Return Home Supplies, a youth-led nonprofit organization working towards ending gun violence in America. Speaking about gun safety legislation not only helped her heal from trauma, but also educated her on how policy and business were intermixed in a way she’d never understood before.
She was really introduced to ESG in college, and was so interested that she declared a major in business in addition to her focus in public policy. In Jules’ words, “Taking classes in ESG is just opening my eyes to what ESG in business and nonprofit can do to make the world a better place.”
The Impact of Customers on ESG
In her classes, Jules is learning about the economic benefits of working towards sustainable development goals as a business. Some notable benefits include higher sales, employee retention, and brand loyalty. She cites Patagonia as a worthy example for other businesses to follow. “We can’t go through and do hours of research on every single product we’re purchasing,” she comments. However, she continues, if we are mindful of the companies we purchase products from, we can make our own carbon footprints more sustainable. Ultimately, though, it’s up to corporations to focus on ESG to enact greater change.
Generation Z and ESG’s Future
The current generation is very willing to embrace many concepts pertaining to social justice. Tom asks Jules why she thinks that may be. “My generation is the most diverse, and the generation most focused on social and economic justice,” Jules claims. Generation Z strives to eventually work for organizations that care about their employees, their environmental impact, and forming long-standing partnerships with social organizations working to alleviate standing issues in our society.
However, she highlights the fact that without large companies listening to what Gen Z is looking for in terms of ESG, none of these problems will be solved. She hopes that as this generation continues to educate themselves and enters the work force, employers will begin to see the value of ESG.
Why Should ESG Internships Be Offered?
Jules speaks about the process of applying for internships. Tom asks her, “Do you have any thoughts that you could share directly to businesses about why they should offer ESG internships?” Though there are tons of marketing and finance internships available, it’s difficult to find roles in ESG despite the high levels of interest expressed by the current generation. Jules understands the requirement of 5 to 10 years of experience for most of the roles that are offered in social and environmental impact management, but encourages companies to work on providing more opportunities to learn from the best in sustainability, to ensure that they have convenient access to people who are ready and willing to tackle ESG issues.
The UN Sustainable Development Goals
There are 17 UN sustainable development goals ranging from zero hunger to decent work and economic growth. Each goal comes with specific targets to help meet them by the year 2030. The UN Global Compact hopes to provide different frameworks and resources to encourage businesses to embrace these goals. Should businesses cooperate, we have a chance to achieve a much more prosperous and equitable future, Jules points out.
RESOURCES
Tom Fox’s email
Jules Oringel | LinkedIn | Instagram | Return Home Supplies
UN Global Compact
In the Episode, I am joined by John Warren Vice President and General Counsel at the Association of Certified Fraud Examiners. We discuss the 2022 ACFE Report to the Nations, which is the most comprehensive report on the global scourge of fraud. It is a fascinating look of how fraud occurs, where is occurs and the steps you can take to prevent it.
Some of the highlights include:
- What is the ACFE Report to the Nations? How often is it released? What are you trying to capture?
- What are some of the big picture findings of the Report?
- What is the annual cost of global fraud?
- Why are hotlines so critical to fraud detection?
- What is the fraud tree?
- What are the 5 critical areas of occupational fraud reviewed?
- What does the Report to the Nations tell us about corruption?
- What detection/prevention areas are the most effective for corruption?
You can download a copy of the ACFE 2022 Report to the Nations by clicking here.
Welcome to a blog post series on Exiger’s fight to secure supply chains, sponsored by Exiger LLC. In this series, we will explore the ongoing efforts of Exiger to lead the discussion and enhancement of Supply Chain Risk Management. In Episode 1, I visit with Erika Peters, a Senior Vice President (SVP) with close to two decades of experience working across the financial, corporate, and government industry, and focus on the firm’s supply chain and third-party risk management practices, and Tim Stone, Senior Director, Supply Chain Risk Management, for Exiger Federal Solutions. We discuss supply chain issues in the healthcare industry, including hospitals, life sciences, pharmaceuticals, medical devices, and medical services.
We began with critical supply chain risk management challenges in the healthcare industry. Peters said the “way I think about the healthcare sector and how it differentiates from the other sectors is that the ultimate risk is trying to mitigate fatalities. This means thinking about the third parties that healthcare companies must work with and then their supply chain makes it one of the most extremely critical industries to be thinking about. In the current post-pandemic era, it is one of the timeliest topics. Equally important is that if you must switch out a key vendor, the entire process can take between 12-18 months, putting your organization in a bind. This means you need to put a rigorous process in place and then follow that process.”
Stone noted key lessons learned on healthcare industry supply chain issues from the pandemic. He stated that the federal government created a Joint Acquisition Task Force in the Department of Defense (DoD) during the pandemic. This was an interagency push to source products across various pandemic-related areas like therapies, vaccines, ingredients, testing, materials and equipment, personal equipment, and even items such as no-touch thermometers. The task force illuminated dozens of product areas across those different sectors, then used market intelligence tools to identify companies in each industry. Further, they used modeling to estimate production capacity and entered information into the Exiger software product DDIQ to risk-rank based upon these and other inputs.
This led to the finding of supply chain fragility. This is because many components in the healthcare supply chain come from state-owned enterprises, and many of these are from China. Even when the team began to focus on migrating to India, it turned out that many underlying components came from China. Another problem discovered was the concentration of raw goods and manufacturers. Stone noted, “we saw otherwise obscure examples of concentration risks arise during COVID that you had never thought about before. In Malaysia, for example, we realized it was a top producer of nitro gloves that owns about 65% of the market. This led to COVID-driven disruptions, which impacted our ability to get nitro gloves. This was the way the world turned and focused on supply chains and where goods are ultimately sourced.” Just-in-time supply chains saw similar if not more disruptions as well.
We then turned to how the healthcare industry supply chain can improve its approach to managing risk. Here Peters noted there were two key areas. The first is programmatic, and the second involves a technological solution. Companies need to create a genuinely risk-based program, for instance, looking at entities that will cause an operating room to shut down or prohibit a company from getting materials required for medicines. These critical entities need to have the most in-depth due diligence; taking that strategic risk appetite and having it trickled down to the tactical level is an important way of making sure that the people at the bottom who are doing the actual work that they are hitting the right risk lens that the company wants to take.
The other piece is to have technology in place to facilitate this and that “we need to improve on that technology.” She noted, “we get to this higher level of more of a predictive posture, which is the golden standard where we need to be. We need to have these teams looking at their risk and bringing it into one view of this entity, especially these critical ones.” It looks at a wide variety of risks, from legal/regulatory to geopolitical to operational. It is doing so quickly and efficiently so the front-line supply chain professionals can make decisions for their organizations’ long-term care and health.
Stone concluded that down the road, supply chain professionals in the healthcare sector “can improve the bottom line, through greater fluidity, greater understanding of their supply chains, greater ability to on the fly to gauge the credibility of vendors, and have that due diligence information at their fingertips through technology.” It will also help avoid a lot of fraud, waste, and abuse and create a more well-oiled machine from a supply chain perspective.
Join us tomorrow when we spotlight the manufacturing and consumer markets.
Resources
Erika Peters Profile
Tim Stone Profile
Exiger Website
Exiger’s Supply Chain Explorer