How sustainability risk mapping adds value to your business
GoodBlog | read time: 7 min
Published: 26 September 2025
The business case for sustainability risk mapping is simple. By identifying and managing potential environmental, social and governance (ESG) risks across their operations and supply chains, companies can reduce their exposure to disruptions caused by regulatory infractions, geopolitical instabilities, climate change impacts and challenges to their licence to operate. This approach helps to build resilience and provides companies with a long term competitive advantage in a challenging economic climate.
However, risk mapping is not just about avoiding disruption; it is also about proactively managing sustainability-related risks which are increasingly tied to both ethical and financial outcomes.
Key drivers for managing sustainability risks
From a compliance standpoint, legislation across Europe, including the CSDDD, the French Duty of Vigilance law and the Norwegian Transparency Act, is placing a growing emphasis on the need for companies to assess the ESG risks in their operations and some, or all, of their supply chains’. Specific human rights due diligence laws are also emerging in Asia and other regions, with South Korea and Thailand both proposing mandatory legislation of this kind.
Not only is risk mapping in the sights of regulators, it is also set out as best practice by organisations such as the United Nations through its Guiding Principles on Business and Human Rights and the OECD through its Guidelines for Multinational Enterprises and Due Diligence Guidance for Responsible Business Conduct While the UN Guiding Principles focus on addressing human rights risks, the OECD Guidelines recommend the development of risk management systems to identify, prevent and mitigate a wider spectrum of sustainability-related risks from occurring across companies’ operations and their supply chains. These include human rights risks, environmental damage as well as governance breaches such as bribery.
Investors too are looking for evidence of the extent to which companies understand and mitigate any environmental, social and governance (ESG) risks they may face, with access to capital significantly enhanced for those companies who do this well.
However, beyond regulators and investors, the management of sustainability risks is also an increasing priority for stakeholders such as employees, customers and suppliers. Any failure to address these issues can lead to companies finding themselves complicit in environmental damage, forced labour, poor working conditions or governance failings all of which erodes trust, damages reputations, and can impede business growth.
What is sustainability risk mapping?
Risk mapping allows companies to pinpoint sustainability-related risks across their operations and supply chains, giving them the insight needed to assess, prioritise, and take targeted action, focusing their resources on the most severe risks.
There is no one-size-fits-all approach to conducting a risk-mapping exercise, as the methodology used will need to be tailored to a company’s specific needs and objectives, the nature of its business activities and the operational context.
However, unlike some due diligence exercises, sustainability risk mapping should be an ongoing process that can be used as a tool to prevent damaging activities or lasting harms from occurring either in their own operations or those of the supply chain.
Human rights risks, for example, often occur far down the supply chain, particularly in sectors where informal labour and low-paid work are prevalent. As such, companies need to understand their own operations and those of the supply chain to know where to look and how to respond.
Many companies are now taking active steps to identify their ESG risks and put effective management strategies in place. An offshore engineering and construction company, for example, partnered with GoodCorporation to strengthen its management of human rights risks in its supply chain. Together, we carried out a comprehensive risk-mapping exercise across five key supplier categories, extending beyond second and third tier suppliers to those deeper in the supply chain where risks can be harder to uncover.
This assessment gave the client greater visibility of potential human rights risks in their supply chain and our recommendations allowed them to implement targeted measures to manage these risks more effectively. With GoodCorporation’s expertise in risk assessing complex supply chains, the client was able to reinforce its human rights programme and align its systems and processes more closely with recognised best practice.
Defining the process of sustainability risk mapping
Effective sustainability risk mapping often involves scoping the risk landscape, engaging stakeholders, evaluating the likelihood and severity of risks and creating a clear risk heatmap. However, this process may differ depending on whether the focus is to identify risks in corporate operations, the supply chain or both.
GoodCorporation recommends the following four-step approach for mapping sustainability risks effectively and how to use that to develop a roadmap for risk mitigation.
Step one: Scoping the risks
The first step in a risk-mapping exercise is to understand the key ESG risks to which the company may be exposed, including any actual and potential harms that might result from its business operations. This should begin with desktop research to understand the risks associated with the nature of business activities and the sector and with the consolidation of data about where the activities take place as risks differ from country to country. This helps to build a preliminary picture of the company’s risk profile.
To better understand supply chain risks, a company should focus on mapping out its higher risk supply chains as comprehensively as possible with the data available. For instance, the most severe human rights risks relating to the delivery of products often occur at the upstream supply chain (e.g. extraction of raw materials), several tiers removed from a company’s direct suppliers. Some sectors and activities are inherently linked to more severe impacts on people due to the nature of the work involved (e.g. intensive manual labour). Others face risks from the jurisdictions in which they operate where weak rule of law or inadequate labour protections may heighten the risk of corruption or human rights harms.
Once the risk areas have been pre-identified, stakeholder engagement can begin to verify the risks and obtain further insights.
Step two: Engaging with stakeholders
Stakeholder engagement is an important part of the risk-mapping process. It helps an organisation to have a more thorough understanding of the potential and actual impacts it faces and the harms they may cause. GoodCorporation helps companies to identify an appropriate range of stakeholders to include, from potentially affected groups or their representatives (e.g. trade unions) to internal stakeholders, business partners and civil society organisations with relevant expertise in the key risk areas.
Conducted well, stakeholder engagement bridges the gap between risks that exist on paper and the impacts that occur in practice. They can be carried out using a combination of surveys, interviews and workshops, bringing a full range of perspectives to the analysis and providing greater context and accuracy to the process.
In a recent project, GoodCorporation engaged with stakeholders in the supply chain of a global company. We collected information on production-related risks through supplier questionnaires, gaining valuable insight into local realities and supplier-specific practices. This was complemented by interviews with the company’s procurement and sourcing teams, as well as representatives from a labour rights CSO, to explore additional risk factors such as strenuous production methods, seasonality of work and allegations of human rights abuses.
However, meaningful stakeholder engagement can be resource intensive. Where resources are limited, companies can consider leveraging existing internal mechanisms such as grievances received from speak-up channels and results from employee surveys. This will provide companies with authentic feedback that can serve as a proxy for stakeholder engagement.
Step three: Evaluation
The third step in the risk-mapping process is the evaluation of risks. At this stage, the findings from the scoping and engagement phases are consolidated to assess the severity and likelihood of the risks. Additional desktop research may be conducted during this step. When assessing severity and likelihood, companies should take into account the operational context of their business activities and those in their supply chain (including any risks associated with the country where the activities are taking place), the nature of the activities themselves and how they might impact people and the environment, or breach the company’s governance rules.
Step four: Mapping and prioritising the risks
Once the sustainability risks have been identified and evaluated, a sustainability risk heatmap is produced mapping the risks on a matrix according to severity and likelihood.
Further criteria may also be applied to narrow down the prioritisation of the most severe risks, including existing mitigation measures across the organisation and supply chains, the company’s leverage to effect change and the criticality of the business activities for the delivery of the company’s products and services. An additional prioritisation heatmap can also be developed based on these additional criteria.
This structured evaluation ensures that resources are directed to the most pressing risks, supporting informed decision-making and laying the foundation for effective action.
At this point, GoodCorporation would include a validation stage, involving a workshop with relevant internal stakeholders to present the findings and verify the risk map. Obtaining stakeholder buy-in at this point is crucial and ensures ownership of the process.
From risk map to risk mitigation
The final step of risk mapping is to develop a prioritised roadmap that sets outs clear actions and timelines to mitigate or remediate the key risks identified. These measures are designed to ensure that the most severe risks are addressed holistically throughout the company’s operations and supply chain, minimising adverse impacts on potentially affected stakeholders and the environment. Measures can, for instance, involve the strengthening of relevant management systems, monitoring mechanisms, purchasing practices, or grievance channels or new investigations.
Stakeholders should have clear visibility of the risks and the actions being taken to manage them. Workshops, training sessions and other communications can help build awareness and help establish effective guidance on how to mitigate risks across operations and down the supply chain, strengthening the overall impact of the businesses’ risk management efforts.
Why risk mapping matters
Risk mapping is more than just a compliance exercise. It is a strategic tool that enables companies to understand, prioritise and address sustainability-related risks across their operations and supply chains. By following a structured approach and internationally recognised best practice, organisations can manage potential harms proactively, protecting people and the planet while reducing exposure to financial, regulatory and reputational risks.
GoodCorporation works closely with organisations to guide them through each step of the process. From identifying salient risks and prioritising action to developing practical mitigation measures and monitoring mechanisms, our expertise helps companies turn risk mapping into actionable steps that bolster sustainability and compliance across the business. We apply this methodology to all areas of ESG risk, including anti-corruption, human rights and environmental risk management.
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