Risk management is the identification, evaluation, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability or impact of unfortunate events or to maximize the realization of opportunities.
Natural capital is the world's stock of natural resources, which includes geology, soils, air, water and all living organisms. Some natural capital assets provide people with free goods and services, often called ecosystem services. All of these underpin our economy and society, and thus make human life possible.
Operational risk is the risk of losses caused by flawed or failed processes, policies, systems or events that disrupt business operations. Employee errors, criminal activity such as fraud, and physical events are among the factors that can trigger operational risk. The process to manage operational risk is known as operational risk management. The definition of operational risk, adopted by the European Solvency II Directive for insurers, is a variation adopted from the Basel II regulations for banks: "The risk of a change in value caused by the fact that actual losses, incurred for inadequate or failed internal processes, people and systems, or from external events, differ from the expected losses". The scope of operational risk is then broad, and can also include other classes of risks, such as fraud, security, privacy protection, legal risks, physical or environmental risks. Operational risks similarly may impact broadly, in that they can affect client satisfaction, reputation and shareholder value, all while increasing business volatility.
Forestation is a vital ecological process where forests are established and grown through afforestation and reforestation efforts. Afforestation involves planting trees on previously non-forested lands, while reforestation focuses on replanting trees in areas that were once deforested. This process plays an important role in restoring degraded forests, enhancing ecosystems, promoting carbon sequestration, and biodiversity conservation.
The Clean Development Mechanism (CDM) is a United Nations-run carbon offset scheme allowing countries to fund greenhouse gas emissions-reducing projects in other countries and claim the saved emissions as part of their own efforts to meet international emissions targets. It is one of the three Flexible Mechanisms defined in the Kyoto Protocol. The CDM, defined in Article 12 of the Protocol, was intended to meet two objectives: (1) to assist non-Annex I countries achieve sustainable development and reduce their carbon footprints; and (2) to assist Annex I countries in achieving compliance with their emissions reduction commitments.
Carbon offsetting is a trading mechanism that allows entities such as governments, individuals, or businesses to compensate for (i.e. “offset”) their greenhouse gas emissions by supporting projects that reduce, avoid, or remove emissions elsewhere. In other words, carbon offsets focus on offsetting emissions through investments in emission reduction projects. Related to that, a carbon credit or offset credit is a transferable financial instrument, that is a derivative of an underlying commodity. It can be bought or sold after certification by a government or independent certification body. When an entity invests in a carbon offsetting program, it receives carbon credits, i.e "tokens" used to account for net climate benefits from one entity to another. One carbon offset or credit represents a reduction, avoidance or removal of one tonne of carbon dioxide or its carbon dioxide-equivalent (CO2e).
Enterprise risk management (ERM) in business includes the methods and processes used by organizations to manage risks and seize opportunities related to the achievement of their objectives. ERM provides a framework for risk management, which typically involves identifying particular events or circumstances relevant to the organization's objectives, assessing them in terms of likelihood and magnitude of impact, determining a response strategy, and monitoring process. By identifying and proactively addressing risks and opportunities, business enterprises protect and create value for their stakeholders, including owners, employees, customers, regulators, and society overall.
Carbon accounting is a framework of methods to measure and track how much greenhouse gas (GHG) an organization emits. It can also be used to track projects or actions to reduce emissions in sectors such as forestry or renewable energy. Corporations, cities and other groups use these techniques to help limit climate change. Organizations will often set an emissions baseline, create targets for reducing emissions, and track progress towards them. The accounting methods enable them to do this in a more consistent and transparent manner.
The term standardized approach refers to a set of credit risk measurement techniques proposed under Basel II, which sets capital adequacy rules for banking institutions.
The carboNZero programme and CEMARS programme are the world’s first internationally accredited greenhouse gas (GHG) certification schemes under ISO 14065. They provide tools for organisations, products, services and events to measure and reduce their greenhouse gas emissions, and optionally offset it. The programmes are owned and operated by Toitū Envirocare - Enviro-Mark Solutions Limited, a wholly owned subsidiary of Landcare Research.
Additionality is the property of an activity being additional by adding something new to the context. It is a determination of whether an intervention has an effect when compared to a baseline. Interventions can take a variety of forms but often include economic incentives.
The ISO 14064 standard is the core part of the ISO 14060 family of standards that are part of the ISO 14000 series of international standards by the International Organization for Standardization (ISO) for environmental management. The ISO 14064 standards provides governments, businesses, regions and other organisations with a complementary set of tools for programs to quantify, monitor, report and verify greenhouse gas emissions. The ISO 14064 standards supports organisations to participate in both regulated and voluntary programs such as emissions trading schemes and public reporting using a globally recognised standard.
The Climate, Community & Biodiversity Alliance (CCBA) is a partnership consisting of Conservation International, CARE, The Nature Conservancy, Rainforest Alliance, and the Wildlife Conservation Society that is primarily active in the field of land management activities.
The CarbonFix Standard (CFS) was an initiative to certify climate forestation projects to sequester carbon from the atmosphere. The CarbonFix Standard was administered by CarbonFix, a non-profit association based in Germany. In 2012, it was acquired by and integrated into the Gold Standard.
Earth Economics is a 501(c)(3) non-profit formally established in 2006 and headquartered in Tacoma, Washington, United States. The organization uses natural capital valuation to help decision makers and local stakeholders to understand the value of natural capital assets. By identifying, monetizing, and valuing natural capital and ecosystem services.
IT risk management is the application of risk management methods to information technology in order to manage IT risk, i.e.:
The Verified Carbon Standard (VCS), formerly the Voluntary Carbon Standard, is a standard for certifying carbon credits to offset emissions. VCS is administered by Verra, a 501(c)(3) organization. Verra is the world's biggest certifier of voluntary carbon offsets. As of 2020 there were over 1,500 certified VCS projects covering energy, transport, waste, forestry, and other sectors. In 2021 Verra issued 300 MtCO2e worth of offset credits for 110 projects. There are also specific methodologies for REDD+ projects. Verra is the program of choice for most of the forest credits in the voluntary market, and almost all REDD+ projects.
Environmental certification is a form of environmental regulation and development where a company can voluntarily choose to comply with predefined processes or objectives set forth by the certification service. Most certification services have a logo which can be applied to products certified under their standards. This is seen as a form of corporate social responsibility allowing companies to address their obligation to minimise the harmful impacts to the environment by voluntarily following a set of externally set and measured objectives.
ISO/IEC 27001 is an international standard to manage information security. The standard was originally published jointly by the International Organization for Standardization (ISO) and the International Electrotechnical Commission (IEC) in 2005, revised in 2013, and again most recently in 2022. There are also numerous recognized national variants of the standard. It details requirements for establishing, implementing, maintaining and continually improving an information security management system (ISMS) – the aim of which is to help organizations make the information assets they hold more secure. Organizations that meet the standard's requirements can choose to be certified by an accredited certification body following successful completion of an audit. The effectiveness of the ISO/IEC 27001 certification process and the overall standard has been addressed in a large-scale study conducted in 2020.
Biodiversity Impact Credit (BIC) is a transferable biodiversity credit designed to reduce global species extinction risk. The underlying BIC metric, developed by Queen Mary University of London, is given by a simple formula that quantifies the positive and negative effects that interventions in nature have on the mean long-term survival probability of species. The metric is broadly applicable across taxa and ecosystems. Organisations whose overall biodiversity impact is positive in terms of the BIC metric contribute to achieving the objective of the Global Biodiversity Framework to “significantly reduce extinction risk”. A perfect market for BICs would lead to near-optimal allocation of resources to species conservation.
