29 Aug 2023

Facctum suggests three ways to optimise AML controls for ESG concerns

Facctum suggests three ways to optimise AML controls for ESG concerns

Financial IT recently published an article shedding light on the growing emphasis organisations are placing on ESG considerations. This shift is propelled by rising customer and shareholder demands, coupled with escalating regulatory expectations.

AML controls for ESG concerns

ESG (Environmental, Social, Governance) has become a key focus for businesses due to customer, shareholder, and regulatory demands. This extends to anti-financial crime efforts as environmental crimes, human trafficking, and corruption intertwine with ESG concerns. Facctum suggests three strategies to enhance ESG through optimized AML controls:

  1. Effective Controls: Strong AML controls are crucial, especially in high-risk industries linked to illegal activities, such as logging or mining.

  2. Positive Culture: Develop a positive AML culture by embedding compliance with ESG and other rules into company policies, providing staff training, and consistently identifying and addressing risks.

  3. Thorough Due Diligence: Apply KYC practices to suppliers and partners, building an ethical supply chain that aligns with ESG values.

By integrating AML practices and ESG objectives, organisations can combat financial crime while supporting sustainability goals.

Our Chief Strategy Officer, Chrisol Correia, highlighted the significance of AML practices in not only detecting and addressing financial crime, but also in playing a crucial role in exposing increasingly sophisticated environmental criminals. He emphasised the dual advantages of this approach: rewarding those adhering to regulations and simultaneously safeguarding the environment and ecosystems.

Read the full article.