Explain how the company determined the material information to disclose regarding assessed material impacts, risks, and opportunities, including the use of thresholds and application of ESRS 1 section 3.2 criteria.
CSRD
Determination of Material Information for Disclosure
When identifying material information related to impacts, risks, and opportunities (IROs) for disclosure, the company must explain the process and criteria used. The explanation should include:
1. Methodology Used to Determine Material Information
Describe the methodological approach used to assess which sustainability information is material for disclosure.
Specify whether the company applied:
Double materiality assessment (impact materiality + financial materiality).
Industry benchmarks and best practices (e.g., GRI, TCFD, SFDR).
Regulatory compliance frameworks (e.g., EU CSRD, ESRS).
2. Alignment with Materiality Assessment Process
Explain how the materiality assessment results guided the selection of disclosures.
Describe how stakeholder engagement, risk analysis, and due diligence findings influenced disclosure decisions.
Ensure consistency between disclosed IROs and materiality assessment outcomes.
3. Criteria for Selecting Key Information for Disclosure
Define the qualitative and quantitative thresholds used to determine whether information is material (e.g., financial impact thresholds, significance of environmental/social effects).
Outline how the company prioritizes information based on:
The magnitude, likelihood, and scope of sustainability risks and opportunities.
Relevance to stakeholders, including investors, regulators, and communities.
The potential financial or reputational impact on the company.
4. Integration with Sustainability Strategy & Business Model
Explain how disclosed material information reflects the company’s:
Strategic priorities (e.g., climate transition, social impact, governance improvements).
Operational risks and business model dependencies on sustainability factors.
Decision-making processes and internal controls related to sustainability risks.
5. Changes in Material Information Over Time
Disclose any changes in material information compared to previous reporting periods.
Explain how emerging risks, new regulations, or stakeholder concerns have influenced updates in disclosed material information.
https://xbrl.efrag.org/e-esrs/esrs-set1-2023.html#723
Also in
IRO-2 - Disclosure requirements in ESRS covered by the undertaking’s sustainability statement
- Provide a list of the Disclosure Requirements covered in the sustainability statement, including page numbers or paragraph references, and a table indicating the location of EU-mandated datapoints, specifying “Not material” where applicable.
- If climate change is deemed not material and ESRS E1 disclosures are omitted, provide a detailed explanation of the materiality assessment conclusions, including a forward-looking analysis of conditions that may make climate change material in the future.
- If a topic other than climate change is deemed not material and its corresponding ESRS disclosures are omitted, a brief explanation of the materiality assessment conclusions may be provided.