Bidders and their advisers should actively scope their due diligence investigations to cover ESG issues (such as compliance with climate commitments and related disclosures, workplace compliance, cultural heritage and cyber risks), and consider whether any identified issues can be managed, or give rise to unacceptable operational, financial and/or reputational risks.
While the scope of ESG due diligence will vary with the industry/company, we can assist with:
- Compliance with the Corporations Act and, if applicable the ASX Corporate Governance Council’s Principles and Recommendations reporting requirements
- Compliance with the recommendations of the Task Force on Climate-related Financial Disclosures and other sustainability reporting standards, including the first two IFRS Sustainability Disclosure Standards, IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures
- Review of risk register and risk management documents
- Review of ESG certifications (e.g. B Corporation), claims (e.g. carbon neutral) and targets (e.g. net zero) and impact of proposed transaction
- Review of board and board committee minutes, including risk/sustainability committee
- Review of management culture and conduct issues including relevant data (e.g. complaint metrics)
- Review of corporate reports and marketing documents for statements that could constitute “greenwashing”
- Cyber, data and privacy due diligence
- Review of wage compliance
- Compliance with the new positive duty to prevent workplace sexual harassment, sex discrimination and victimisation, and response to recommendations from the Respect@Work Report (workplace prevention and response model)
- Workplace health and safety governance including management of the risk of psychosocial hazards in the workplace and officer due diligence
- Review of whistleblower policy and framework and compliance with regulatory guidance on good practice in whistleblower management
- Compliance with modern slavery, anti-bribery and corruption, anti-money laundering, and sanctions risks and regulatory requirements
- Where applicable, compliance with applicable APRA standards, including 220, 222, 229, 231, 232, 234, 235, 510, 511 and 520
- Review of risks arising from current regulatory investigations, activist activity (including litigation), community issues etc relating to ESG matters
Keep track of climate and governance key dates
As legislation, regulations, and guidelines continue to change, it is critical to keep up with key dates: whether it is a reporting deadline, a chance to submit views on a change, or the date an update is intended to come into effect - you won't miss a milestone with our Corporate Governance Regulatory Tracker.
