Glossary

An embargo is an official ban on trade with a country or on trade in certain goods, set by a government or international body, to pressure a state or limit its capacity.

Embezzlement is the dishonest taking or diversion of money or property by someone who was trusted to look after it, such as an employee, trustee or officer.

An emerging risk is a newly developing or changing threat whose causes, likelihood and impact are still poorly understood, so it cannot yet be measured with the usual tools.

End-user computing risk is the chance of errors, data loss or misuse arising from spreadsheets, macros, databases and small tools built and run by business staff outside formal IT development and control.

An environmental impact assessment is a formal study of the likely environmental effects of a proposed project, carried out before approval so that harm can be avoided, reduced or weighed against the benefits.

ESG risk is the potential for financial loss or reputational damage when environmental, social or governance factors affect a company, its customers or its investments.

ESG data quality describes how complete, accurate, consistent, comparable and verifiable a company’s environmental, social and governance data is, and so how far investors, regulators and managers can rely on it.

An ethics committee is a group, usually at board or senior management level, that oversees an organisation's ethical standards, reviews difficult cases and monitors how well its code of ethics is followed.

An ethics hotline is a confidential channel, by phone, web form or app, through which employees and others can report suspected misconduct or ask for guidance, often anonymously and often run by an outside provider.

An ethics officer is a senior person responsible for promoting ethical conduct inside an organisation, advising staff on dilemmas, running training and handling reports of breaches of its code of ethics.

Executive compensation is the total pay of a company's senior leaders, made up of salary, bonuses, share awards, pensions and benefits, designed to attract talent and link rewards to performance and risk.

An outsourcing exit strategy is a documented plan for ending a supplier arrangement in an orderly way, by moving the service to another provider or back in house, with little or no disruption.

Expected loss is the average loss a lender or insurer anticipates over a period from a portfolio, usually calculated as probability of default times loss given default times exposure at default.

Explainability is the ability to describe, in terms a person can follow, why an AI or statistical model produced a particular output or decision.

Exposure at default is the estimated amount a lender would be owed at the moment a borrower defaults, including any drawn balance and the part of unused credit lines likely to be drawn by then.