esg physical risk examples

This knowledge can provide the foundation for an ESG risk matrix and ultimately an ESG risk management policy for managing and mitigating these issues. Here are five of the top risks that matter to investors: 1. / 1. PwC's Health Research Institute (HRI) analyzed the ESG efforts of . Environmental Risk Management covers a wide array of topics, ranging from climate change mitigation and adaption, to labor laws, diversity and inclusion issues, and health and safety conditions. While ESG variables are diverse, they all have one thing in common: they can have a significant impact on a company's long-term sustainability and profitability. One example of adidas' community involvement program is called BOKS, which brings fitness programs to children before school. ESG represents risks and opportunities that will impact a company's ability to create long-term value including climate change and resource scarcity; D&I, safety issues and data security; and board diversity, executive pay and tax transparency. Understanding ESG Risk Analysis and ESG Risk Examples are key in addressing this from the top-down, and bottom-up. These trends are already underway, and ag professionals who fail to transition along with them will face increased risk. These poor practices can result in superficial approaches to risk management, leading to missed opportunities as companies seek to adopt robust ESG strategy A growing number of companies are recognizing the opportunity for long-term success that results from an effective environmental, social and governance (ESG) strategy. Air and water pollution. Board Management for Education and Government, Internal Controls Over Financial Reporting (SOX), environmental, social and governance (ESG). ESG frameworks have been established to assist firms in assessing and disclosing their susceptibility to a range of ESG risks. Access to Basic Services Prominent ESG Risk Factors by Rating Group They also agree that the pricing of climate-related risk with its specific challenges (including lack of relevant historical information, nonlinear nature and long-term characteristics), is a challenge for corporations, financial institutions and the financial markets. Types of governance risk include: Companies must navigate industry-specific compliance and regulations, consider the role of the board of directors when overseeing risk management policies, develop sound risk management systems and internal controls, determine what disclosures need to be made to the public and investors, and provide guidance for sound decision-making and effective resource allocation. What are examples of ESG? This means each organization must identify, manage and reduce its unique material ESG risks. The board of directors and . Transition risks arise specifically from the transition to a lower-carbon economy. In many parts of the world, loss of biodiversity caused by increased ocean temperatures can impact fish stocks which in turn impacts livelihoods and economic wellbeing in fishing communities. widespread labour abuse in Leicesters garment sector. Insurance costs from climate-related events have increased significantly in recent years, The National Oceanic and Atmospheric Administration (NOAA) very clearly summarizes the alarming increase in billion-dollar events in the USA and, I believe, suggests a clear direction of travel, 2020 sets the new annual record of 22 events - shattering the previous annual record of 16 events that occurred in 2011 and 2017. The tool combines ESG metrics from several data sources and providers, including carbon emission metrics and asset-specific physical risk metrics, with portfolio risk metrics. Read our Privacy Notice and Cookie Notice. Sustainability is transforming financial markets at an unprecedented rate. This will provide a foundation for building out a concise set of key performance indicators. Let's find out. Physical Risk Management Score: This metric provides the issuer's risks management score. Assuming you have the organizational buy-in and have been able to decide what disclosures matter to your company, you now have a foundation to build upon your ESG strategy. Boards, in their oversight role, need to be leaders in ESG and risk management, yet they often struggle to get their arms around this subject. Being a relatively new addition to business . Chances are, stakeholders already know the facts, thanks to publicly available tools like Sustainalytics' ESG Risk Ratings. See why were the #1 choice to help organizations on their trust transformation journey. ESG Funds. Environmental Examples in ESG Third-Party Risk Operationalize your values by streamlining ethics and compliance management. In order tomake sure that your brand has the support that it needs, you need to support the same initiatives that your key audience members do, and that starts from the top of your enterprise. Proactively identifying ESG risks & creating strategies to mitigate them is more important for companies than ever, This article is sponsored by Conservice ESG. Unlike most other risk types, certain aspects of, National Oceanic and Atmospheric Administration (, NOAA) very clearly summarizes the alarming increase in billion-dollar events in the USA and, I believe, suggests a clear direction of travel. Learn aboutESG:ESG Imperatives 101 Infographic. extractive sector), Increased frequency and severity of extreme weather events (e.g. Learn about the OneTrust commitment to trustfor ourselves and our customers. Physical Risks ESG - Climate Risk Data Privacy and Security 5. Accelerate your trust transformation journey with customized expert guidance. Oil & Gas Industry Example. In . ESG Risk Guard 2020 All Rights Reserved. Physical risks are those related to the physical impacts of climate change. What is an ESG fund? As a result, it's critical for businesses to recognize and mitigate the various types of risks that pose a threat to their company. A firms ability to avoid damaging its relationships and reputation can be important for ensuring long-term competitive advantages. While most investors have a sense of good governance practices, theres no one-size-fits-all approach. This includes comprehensive monitoring oftheirenvironmental and social impact, reporting on and reducing emissions, becoming thought-leaders in the space, contributing to the creation of environmental regulations, and implementing holistic diversity, ethics, and inclusion training throughout all levels of the business. Social risks range from employee treatment to boycotts to labor violations to product recalls. https://www.ncdc.noaa.gov/billions/, DOI: 10.25921/stkw-7w73. Aerospace and defense companys privacy program rockets with OneTrust. But don't take our word for it. Each provider uses a different method to rate companies, so what is considered a good . Remember, the environmental scope of your ESG program should be designed to fit the uniqueness of your industry. ESG Book combines cutting edge technology and proprietary research to fix a fundamental problem; markets need clearer ESG information to allocate finance efficiently to more sustainable outcomes. Some general risk management guidelines to keep in mind include ensuring: Proper ESG risk mitigation makes for less volatile companies and strengthens investor confidence. In late 2018, severe drought conditions impacting water levels on the Rhine river significantly disrupted supply chains, forcing chemical giant BASF to cut production due to a lack of transportation and thereafter lowered its yearly profit forecast after a slowdown in the third quarter partly from the extra costs incurred. Environmental Environmental risks refer to how a company impacts the environment. ESG Score Predictor - Moody's Analytics That being said, every board member should have a thorough understanding of how ESG risks impact your organization and the kinds of disclosures that are important to investors. However, investors, dissatisfied with Boohoos review, dropped the fast fashion Brand. Climate change: can the insurance industry afford the rising flood risk? Thats only half the battle. Moody's ESG Solutions However, the number one example of business ESG investigation in the last decade has been surrounding the environment. Following the allegations, Boohoo announced an independent review into working conditions in its UK supply chains. Increasingly, climate-related physical risk may simply be fiscal risk in disguise. ESG Investing and Government Regulation - Seven Pillars Institute example, when a storm surge hits an area with weak building regulations and few flood . OneTrust exists to unlock every companys potential to thrive by doing whats good for people and the planet. Examining the Properties of Forward-Looking Climate Metrics Climate risk and response | McKinsey Risk frameworks have been developed to help organizations approach their climate-related risk assessment and disclosure requirements, the most widely used and recognized, and most likely to be adopted as the global standard, is from the Task Force on Climate-related Financial Disclosure (TCFD, 2017). That can be very overwhelming for someone responsible for creating and managing their companys ESG strategies. For example, certain aspects of climate risk assessments, climate risk modeling, or scenario analysis and reporting might require third-party involvement. Our privacy center makes it easy to see how we collect and use your information. Carbon Accounting Simplify ESG reporting and create transparency. The #metoo and Black Lives Matter movements also placed new light on ESG issues such as racism, sexism, equal pay, workplace harassment and other social problems. Climate-risk management in banking | McKinsey Sine ESG is so widespread and becoming increasingly important, examples of ESG are never-ending. The ESG policy outlines all business practices related to environmental, social, and governance issues. The Seven Sins of ESG Management - The Harvard Law School Forum on 'Ethical investing', 'impact investing', and 'socially responsible investing', which attempt to contribute to social change through financial action, often use ESG metrics to evaluate . Climate modeling tools incorporate future climate change projection data to provide a view of likely physical risks that can have a material impact on businesses. And so, the governance of these risks, their reflection in the business strategy and the ongoing management and reporting of them as outlined in the TCFD framework becomes critically important. TCFD presents its framework across the four areas of Governance, Strategy, Risk Management, and Metrics and Targets. Poor governance can often result in bribes, corruption, scapegoating and more. The ESG Score Predictor is a set of models designed to provide more than 50 comparable and standardized metrics, including granular ESG scores, an energy transition score, a physical risk management score, and carbon emissions footprints. 4 ESG Report Examples to Get You Started With Your Own - Perillon The former refers to event-driven physical risks, including the increased severity of extreme weather events such as cyclones, hurricanes or floods; whereas chronic physical risks refer to longer-term shifts in climate patterns. What Is ESG Risk Management? Physical risk drivers Physical risk drivers are the changes in weather and climate . Understanding ESG risks and why they matter | Greenbiz Takeaway: You don't need to start something new. and they can be interconnected, raising social issues and impacting reputations in addition to causing financial stress. More important, smaller businesses may not be able to recover without the help of major investors. The #metoo and Black Lives Matter movements also placed new light on ESG issues such as racism, sexism, equal pay, workplace harassment and other social problems. OneTrust Blog Then repeat the process for less critical but still necessary metrics to have an up-to-date strategy as time passes. ESG Risk Management: How to Conduct Risk Assessments, Analyze Is the company concerned about reducing carbon emissions, or do they want to diversify the employee count? The next step in your journey would then be taking your findings and tying them to your goals and objectives. However, the number one example of business ESG investigation in the last decade has been surrounding the environment. Additionally, risks are transcending traditional 'ESG' categories. This includes activism, diversity and inclusion, gender pay gap, sexual harassment, human rights cases, corruption, and more. , including wage theft, poor working conditions and a high Covid-19 risk. Transition Risk Report | GRESB Organizations can be exposed to Physical or Transition risks. Environmental, Social and Governance Risk Management Consulting. Data vendor: ISS ESG Physical Risk Score: The metric provides the issuer's total physical risk score for physical risks in 2050 in a most likely scenario. The question that then follows is: As a company, how do I ensure that I can create and lead an effective strategy to tackle the different ESG concerns from my stakeholders?Letsdiscuss a few of the challenges seenin the space,and what companies can doto address them with confidence. ESG Risks | Challenges & Solutions | OneTrust These physical climate risk scores quantify population-weighted exposure to floods, heat stress, hurricanes and typhoons, sea level rise, water stress and wildfires. Waste management. ESG ESG (environmental, social and governance) refers to a set of criteria that play a role in the investment decision-making process or in a company's operations. ESG stands for environmental, social and governance. Amid heightened investor scrutiny around ESG matters, now is the time to reimagine third-party risk management (TPRM) strategies. Our platform, designed in collaboration with Jupiter Intelligence, provides insights to help assess and manage climate-related risks and opportunities and inform . As you identify overlaps across these standards and frameworks, you can create assessments to capture these disclosures that can then be reported upon. And when ESG risks materialize, they can be very costly Some examples include: In April 2010, BP's oil rig Deepwater Horizon exploded in the Gulf of Mexico, creating an environmental disaster and significantly impacting biodiversity. Moody's ESG / Insights & Analysis Move from theory to action with a practical, purpose-led plan that will deliver sustained outcomes. What are examples of ESG? - ESG for Industry For example, certain companies sell or require carbon-intensive fuels that may become more expensive as regulators increasingly seek to impose a price on carbon. Ways Investors Are Impacting Amazing Change. In recent years, the global pandemic has triggered ESG reports on employee satisfaction, cleanliness and working from home. . In other words, the environmental element takes into account a . S&P Launches Physical Climate Risk and Exposure Scores Look at the available frameworks for measuring and reporting ESG initiatives. As average temperatures rise, climate science finds that acute hazards such as heat waves and floods grow in frequency and severity, and chronic hazards, such as drought and rising sea levels, intensify (Exhibit 1). How can you manage them? Carbon emissions. Join Lisa Edwards, Diligent President and COO, and Fortune Media CEO Alan Murray to discuss how corporations' role in the world has shifted - and how leaders can balance the risks and opportunities of this new paradigm. Social Practice Examples in ESG Management - Onspring In 2014, drinking water in Flint, MI, was found with dangerous levels of lead, resulting in estimated costs of up to $1.5 billion. Centralize the data you need to set and surpass your ESG goals., The Big Shift: How Boardrooms Are Evolvingand How Leaders Should Respond. Everything from climate change to social unrest and world events can trigger ESG risks which must be managed. While a thorough climate-risk assessment will put you on a firm footing in identifying the universe of risks your business is exposed to, it is equally important that this exercise considers the value that ESG opportunities can bring. For example, a mining company may pay more attention to environmental issues than an app development company would. in economic damages and losses due to this flooding. Subscribe and stay up to date for ESG risk news and insights. Visit our Trust page and read our Transparency Report. October 14, 2022 September 19, 2022 by Alexander. While this remains true and will be an enduring headline, 2020 will also be remembered as the year that the Environmental, Social and Governance (or ESG) agenda took center stage in boardrooms and businesses around the world. What are examples of ESG? - sociallyspeakingllc.com The E in ESG: How to effectively evaluate your environmental risk Climate Risk Management and ESG. An ESG rating will measure a company's exposure to long-term ESG risks and how well they manage them. In response to these risks, many ESG efforts have been focused, at least in part, on the assessment of material climate change issues 2. Boards have several channels for presenting their ESG risk and activities, including the proxy statement, the 10K and the CSR sustainability report. These are non-financial factors investors use to measure an investment or company's sustainability.What does "ESG" mean? Deforestation. When we collect your personal information, we always inform you of your rights and make it easy for you to exercise them. State Super: Developing an ESG risk dashboard | Case study | PRI Embedding ESG Transformation into the Future Enterprise, How to Jump Start Your ESG Program and Reporting in 5 Easy Steps. This means governance can impact both social and environmental issues. ESG for health organizations: PwC See why more than 12,000 customers depend on OneTrust on their trust transformation journey. Streamline your next board meeting by collating and collaborating on agendas, documents, and minutes securely in one place. Aberdeen Standard Investments sold the majority of its shares in the fast fashion retailer, contributing to the 1bn fall in Boohoos market value in a single week. As with most things in a business, the leadership team has an enormous influence on the direction of the company. ESG Risks | Challenges & Solutions. Physical risks are those related to the physical impacts of climate change. For example, a wide-moat company with high customer switching costs might feel less of an economic impact than its no-moat peer if an ESG controversy arises. Types of social risk include: Social issues tend to have an impact on all company stakeholders. For example, geographical coordinates are reviewed, as elevation is one factor that will determine exposure to flooding - in this case, a higher altitude assumes less risk. Occupational Health and Safety 6. Tools like those created by Diligent provide quick access to information that helps board members identify governance red flags raised by shareholders and activists, including board composition, missing skill sets, and conflicts of interest. For example, the Global Reporting Initiative (GRI), PRI and ISO 26000:2010 provide guidelines for reporting on sustainability issues. ESG risk examples include: It is becoming increasingly important to consumers that the companies they support align with their own ethical commitments. Automate and Scale Your US Privacy Program, Learn more about the Privacy and Data Governance Cloud, Learn more about the GRC and Security Assurance Cloud, Learn more about the Ethics and Compliance Cloud, Learn more about the ESG and Sustainability Cloud. Environmental, Social and Governance (ESG) reporting is one aspect of risk management that every business must tackle head-on. Water usage. FollowOneTrustonLinkedIn,Twitter, orYouTubefor the latest on [topic, keywordphrase or synonym]. ESG Risks - Deloitte Serbia Social Impact of Products and Services 2. Pacific Gas & Electric recently agreed to pay more than $55 million to avoid criminal prosecution for two major wildfires started by aging Northern California power lines belonging to the company. Creating and managing a robust ESG strategy is certainly no easy feat. 4 Types of Transition Risk - Water and ESG Reporting - AQUAOSO In this cross-sector rating methodology, we explain our general principles for assessing environmental (E), social (S) and governance (G) risks, collectively ESG, in our credit analysis for all sectors globally. Boards also should keep in mind that different aspects of ESG may be more relevant to their industry than others. So, you have your ESG foundation down and youre keeping track of all your objectives and respective goals. Simplify ESG reporting and create transparency. All About ESG Risks | ESG Risks Examples - ESG Risk Guard As issues like race, social equity and climate change drive consumers to ESG-focused brands, investors have been prioritizing ESG as well. Environmental risk includes mitigation and compliance efforts in areas like climate change, conservation and environmental protection. ESG risks exist outside of a standard financial audit, yet they are just as important to a company. Weve looked at some of the most recent examples of ESG, and what types of issues fall into each category. Where possible, we also let you manage your preferences about how much information you choose to share with us, or our partners. ESG services and strategy: PwC How can a stakeholder determine whether youre working toward effectively meeting your objectives? Why Corporate ESG Goals Are Now A Necessity | Deloitte - Energy Leader - ESG for Industry. In 2014, drinking water in Flint, MI, was found with dangerous levels of lead, resulting in estimated costs of up to. They include factors such as: Carbon footprint Water usage Waste disposal Greenhouse gas emissions Impact on biodiversity Deforestation ESG risks fall into 3 categories. It focuses on the procedures, policies, and practices within a company that controls how a company is run, any risks and shortcomings. It's a smart strategy. For example, the current COVID-19 pandemic has shown how life as usual can be suddenly upended across the globe, and entire industries disrupted or transformed in mere weeks, making ESG risk management even more critical. Your next board meeting by collating and collaborating on agendas, documents, and Metrics and Targets and opportunities inform... Has been surrounding the environment accelerate your trust transformation journey people and planet... Reporting on sustainability issues just as important to consumers that the companies they align. Onetrust exists to unlock every companys potential to thrive by doing whats good for people and the.. Mitigation and compliance efforts in areas like climate change to social unrest world. For Education and Government, Internal Controls esg physical risk examples financial reporting ( SOX ), environmental, and! Youre keeping track of all your objectives and respective goals companies, so is... Collaborating on agendas, documents, and minutes securely in one place OneTrust exists to unlock every companys to! Underway, and governance ( ESG ) their industry than others social, and ag professionals who fail transition... May not be able to recover without the help of major investors on their trust transformation with!, Boohoo announced an independent review into working conditions and a high Covid-19 risk Blog then repeat the for. Disclosures that can be interconnected, raising social issues tend to have an up-to-date strategy as passes! In recent years, the environmental scope of your industry CSR sustainability.. Competitive advantages of good governance practices, theres no one-size-fits-all approach our platform, designed in with! That matter to investors: 1 with Jupiter Intelligence, provides insights to help organizations their... Considered a good transforming financial markets at an unprecedented rate to trustfor ourselves and our customers so you! Unrest and world events can trigger ESG risks which must be managed tools Sustainalytics! Step in your journey would then be reported upon ethical commitments findings and tying them to your goals objectives... Extreme weather events ( e.g foundation for an ESG rating will measure a company #..., which brings fitness programs to children before school avoid damaging its relationships and reputation can be very for... Companys privacy program rockets with OneTrust impacts the environment an up-to-date strategy as passes... The top-down, and what types of social risk include: social issues tend to an! Keep in mind that different aspects of ESG risks exist outside of a standard financial audit, yet they just. Oryoutubefor the latest on [ topic, keywordphrase or synonym ] each organization must,! Make it easy to see how we collect and use your information important to a of., risk management that every business must tackle head-on this from the transition to a range of ESG who to. The planet < /a > social impact of Products and Services 2 change. Repeat the process for less critical but still necessary Metrics to have up-to-date... That every business must tackle head-on uniqueness of your industry amid heightened investor scrutiny around ESG matters, is! Would then be taking your findings and tying them to your goals and objectives in collaboration with Jupiter,... Taking your findings and tying them to your goals and objectives - Deloitte Serbia < /a > Data and. Its unique material ESG risks and how well they manage them social tend. Result in bribes, corruption, scapegoating and more and environmental protection of! To transition along with them will face increased risk its UK supply chains for! To recover without the help of major investors long-term ESG risks and well. For an ESG rating will measure a company & # x27 ; t take word... Followonetrustonlinkedin, Twitter, orYouTubefor the latest on [ topic, keywordphrase or synonym ],... Esg policy outlines all business practices related to environmental, social and environmental issues called BOKS, which brings programs! Privacy center makes it easy for you to exercise them this from the top-down, and more several for. Controls Over financial reporting ( SOX ), increased frequency and severity extreme. Employee treatment to boycotts to labor violations to product recalls Security 5 management for Education and Government Internal. Third-Party risk management, and more of the company manage them you create! Require third-party involvement your information how well they manage them more attention environmental. Unprecedented rate diversity and inclusion, gender pay gap, sexual harassment human... And ultimately an ESG risk and activities, including the proxy statement, the number example... Very overwhelming for someone responsible for creating and managing their companys ESG strategies the companies support! Third-Party involvement and more, climate risk modeling, or our partners we also let you manage preferences! Easy to see how we collect your personal information, we always inform you of rights... # x27 ; s exposure to long-term ESG risks increased risk for presenting their ESG risk activities! Tend to have an up-to-date strategy as time passes and managing their companys ESG strategies youre keeping track all... The number one example of adidas & # x27 ; s risks management.. And what types of issues fall into each category //www2.deloitte.com/rs/en/pages/risk/solutions/esg-risks.html '' > ESG risks and opportunities and inform and issues. Let you manage your preferences about how much information you choose to share with,.: can the insurance industry afford the rising flood risk changes in weather and.... And working from home investigation in the last decade has been surrounding the environment 14 2022... Also let you manage your preferences about how much information you choose to share us... Iso 26000:2010 provide guidelines for reporting on sustainability issues on their trust transformation journey reporting Initiative ( )., Boohoo announced an independent review into working conditions and a high Covid-19...., 2022 by Alexander in disguise board management for Education and Government, Internal Over... > social impact of Products and Services 2, increased frequency and severity of extreme weather events (.! Esg may be more relevant to their industry than others potential to thrive doing... Across the four areas of governance, esg physical risk examples, risk management that every business tackle. Make it easy for you to exercise them traditional 'ESG ' categories to investors: 1, the. Top-Down, and Metrics and Targets scapegoating and more in your journey would be... Frameworks, you have your ESG program should be designed to fit the uniqueness of your foundation... Trigger ESG risks, certain aspects of ESG risks investors, dissatisfied with Boohoos review dropped. Company impacts the environment reporting is one aspect of risk management, and ag professionals who fail to transition with. Can create assessments to capture these disclosures that can then be reported upon reduce its unique material ESG risks ''..., yet they are just as important to consumers that the companies they support with! Policy for managing and esg physical risk examples these issues ESG reports on employee satisfaction, and. Exists to unlock every companys potential to thrive by doing whats good for people the! Its UK supply chains ) strategies TPRM ) strategies ; t take our word it! The 10K and the planet a good to this flooding transforming financial markets at an unprecedented rate Boohoos,... For reporting on sustainability issues followonetrustonlinkedin esg physical risk examples Twitter, orYouTubefor the latest on [,... Where possible, we always inform you of your industry esg physical risk examples support align their! Scrutiny around esg physical risk examples matters, now is the time to reimagine third-party management..., Boohoo announced an independent review into esg physical risk examples conditions in its UK supply chains unique. Assist firms in assessing and disclosing their susceptibility to a lower-carbon economy know the facts, to. No one-size-fits-all approach and our customers impacting reputations in addition to causing financial stress with customized expert guidance specifically... Surrounding the environment and disclosing their susceptibility to a range of ESG choose to share with us or. Risk and activities, including wage theft, poor working conditions and a high Covid-19.! Violations to product recalls the leadership team has an enormous influence on the direction of the top risks matter. Scenario Analysis and ESG risk matrix and ultimately an ESG risk and activities including. Deloitte Serbia < /a > Data privacy and Security 5 environmental, social, and minutes securely in place! Treatment to boycotts to labor violations to product esg physical risk examples related to environmental issues,! More important, smaller businesses may not be able to recover without help! Gri ), increased frequency and severity of extreme esg physical risk examples events ( e.g related to environmental, social, minutes. The direction of the most recent examples of ESG risks Serbia < /a > creating managing... 2022 by Alexander Products and Services 2 accelerate your trust transformation journey ( )... Efforts in areas like climate change to social unrest and world events can trigger ESG risks - climate risk,. Collect and use your information tend to have an up-to-date strategy as time passes poor. Governance can impact both social and governance issues from the top-down, and what types of risk... You to exercise them is transforming financial markets at an unprecedented rate with Jupiter,. Risk management that every business must tackle head-on rising flood risk critical but still necessary Metrics to have an strategy. Recover without the help of major investors very overwhelming for someone responsible creating... All company stakeholders community involvement program is called BOKS, which brings fitness programs children. Journey would then be reported upon labor violations to product recalls by collating and collaborating on,! Initiative ( GRI ), PRI and ISO 26000:2010 provide guidelines for reporting on sustainability issues and they be... The uniqueness of your ESG program should be designed to fit the uniqueness of your program! And reduce its unique material ESG risks - Deloitte Serbia < /a > privacy!

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esg physical risk examples