Is your business ready to assess its sustainability impact? Understanding and applying Double Materiality is a game-changer in corporate reporting. Stay tuned as we guide you through CSRD’s essential requirements!

1. What is Double Materiality?
   • Financial Materiality: How sustainability issues (e.g., climate change, social inequalities, governance risks) affect the company’s financial performance and long-term value.
   • Impact Materiality: How the company’s operations, products, and services impact the environment, society, and economy—positively or negatively.
2. Why is Double Materiality Important?
   • Encourages companies to integrate sustainability risks into business strategy.
   • Helps stakeholders, investors, and regulators gain a holistic view of corporate sustainability performance.
   • Ensures businesses take responsibility for their social and environmental footprint.
3. How to Apply Double Materiality?
   • Identify key ESG issues relevant to the company and its stakeholders.
   • Assess both the financial and impact materiality of these issues using data-driven analysis.
   • Report findings transparently using the European Sustainability Reporting Standards (ESRS).
4. Regulatory Significance

• The European Financial Reporting Advisory Group (EFRAG) has embedded double materiality as a mandatory requirement under CSRD.
• Companies must conduct a materiality assessment to ensure that their reports include all significant ESG aspects.

Coming Next Week:

European Sustainability Reporting Standards (ESRS) – The New Framework for ESG Reporting: CSRD requires businesses to align their reporting with ESRS, a standardized framework that defines what and how sustainability information should be disclosed. Join us next week as we explore the structure, key reporting areas, and compliance requirements under ESRS.