Risk and impact management
Assessment, management and integration
This section describes our processes for identifying, assessing and prioritizing nature-related risks, impacts, opportunities and dependencies. Our SD Risk Management Standard is a mandatory, auditable, annual requirement for business units (BUs) and select corporate functions. The output informs the corporate enterprise risk management (ERM) system and key business-planning processes for the company, including our corporate water and biodiversity strategies. Read more about our sustainability risk process.
A location-specific risk assessment is completed annually by all operated assets and new projects. The process is guided by our SD risk assessment tool and considers nature-related physical risks, transition risks and climate change related physical risks with potential nature impacts. Action plans are developed for significant and high risks and include measures to mitigate risks or impacts.
State of nature assessment
The Task Force on Nature-related Financial Disclosures (TNFD) describes state of nature as the condition and extent of ecosystems and species population size and extinction risk, including positive or negative changes. State of nature changes not only influence habitats and species but also have broader implications on ecosystem services, which are critical to various aspects of human and economic activities.
We have completed pilot assessments to characterize the state of nature for locations where our activities and operations contribute to nature impact drivers. At the business unit (BU)) level, our understanding of the local ecosystem condition and biodiversity importance is based on habitat and species distribution assessments, wildlife surveys and species monitoring. Examples from our portfolio include Alaska North Slope environmental field studies, APLNG seabird and mangrove monitoring, Canada use of acoustic and ultrasonic recording units, Lower 48 sharp-tailed grouse GPS tagging and Norway surface glider field studies.
At the corporate level, we have started to explore geospatial indicators to complete a relative ranking of locations where our operations interface with areas that are important for biodiversity, have high ecosystem integrity, are exposed to water stress or are important for ecosystem service provision for local and Indigenous communities.
External factors
We assess external factors impacting the state of nature for regions where we have operated assets. This evaluation is carried out using the Integrated Biodiversity Assessment Tool (IBAT) Species Threat Abatement and Restoration (STAR) score which provides information on the relative contribution of different threat types based on the International Union for the Conservation of Nature's (IUCN) threat classification scheme. On average, the most prevalent threats for asset areas, as indicated by the highest STAR scores, encompass invasive or problematic species, genes and diseases, biological resource use and agriculture and aquaculture.