A material ESG risk that cannot be addressed by company initiatives is best described as:

The ESG risk taxonomy separates unmanaged ESG risk into two types:

Unmanageable risk– risks that cannot be mitigated by any company action (e.g. systemic climate change risk)

Management gap– risks thatcanbe mitigated but currently arenot

“Unmanageable risk cannot be addressed by company initiatives… The management gap represents risks that could be managed by a company through suitable initiatives but which may not yet be managed.”

Therefore, a material ESG risk that isinherent or systemicand cannot be addressed by management qualifies asunmanageable risk.