Dual threatdual defenseWhy ESG is the key to effectivebank complianceA synergistic approach to safersustainable bankingToday,many financial institutions trackenvironmental,social,and governance(ESG)factorsto better understand the organizations they dobusiness with.They do so for a variety of reasons-to reduce risk from issues such as climate changeand scandal;to gauge the potential financialperformance of client or supplier companies;toguide customers looking for sustainable financeor responsible investments;to manage their owncarbon footprint;and to comply with increasingESG-related regulatory requirements.At the sametime,institutions put a great deal of effort intofinancial crime compliance(FCC),and meetingthe standards and regulations established bythe U.STreasury Department's Financial CrimeEnforcement Network(FinCEN)and othergovemmental bodies.These FCC operations aim toreduce money laundering and protect the financialsystem from the flow of illicit funds.There's a consensus that ESGconsiderations should be incorporatedinto the client prospect evaluationstage.This ensures that reputationalrisk is addressed upfront,prior toonboarding and KYC processes.Business Executive,major UK bankBoth ESG and FCC screening are important for allfinancial institutions.These two critical activitieshave traditionally operated as separate domains,each in its own silo pursuing its own mission.Butthere is an untapped potential to leverage ESGconsiderations in FCC,using technology to combinethe strengths of both domains.By doing so,institutions can significantly enhance their efforts toproactively uncover and combat illicit activities andreduce their own risk of being associated with crimeand running afoul of regulators.2 Dual threat,dual defense