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Double Materiality Assessments

Clarifying what actually matters

Over the last few years many organisations have invested heavily in double materiality assessments (DMA) and ended up with long lists of material topics. That usually satisfied a reporting requirement but did not always give management much clarity about what the findings mean for the business.

That is not necessarily a weakness of double materiality itself, as the assessment brings together two valuable perspectives for leadership teams:

Impact materiality: how the organisation affects people and the environment through its operations, products, services and business relationships.

Financial materiality: how sustainability matters create risks or opportunities for the organisation, including through its impacts, dependencies and business relationships.

A matter is material when it meets either test or both. The two perspectives are connected, but they answer different questions and should not be collapsed into one score.

A useful DMA draws on evidence from the business rather than treating materiality as a separate ESG exercise. Relevant information may already sit in enterprise risk management, strategy, stakeholder engagement, responsible sourcing and human rights and environmental due diligence.

Human Rights and Environmental Due Diligence can be particularly valuable for impact materiality because it brings evidence from incidents, grievances, value-chain assessments and affected stakeholders.

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Flexible delivery, aligned to your organisation

Our role depends on the organisation’s internal capability, available evidence and reason for carrying out the assessment.

We can design and facilitate the complete double materiality assessment. We can also focus on the methodology, thresholds, governance and decision logic, while internal teams carry out parts of the work.

Where an organisation has already completed an assessment, we can review the approach, test the conclusions or help strengthen the evidence and documentation. Support may also be useful when the assessment needs updating because the business, value chain or regulatory context has changed.

In all cases, the objective is clear prioritisation that works across the organisation, rather than a one-off assessment conducted in isolation. The organisation should be able to explain what is material, why it reached that conclusion and how the outcome connects to strategy, governance, risk management and reporting.

What you can expect

The assessment should give the organisation a clear and defensible view of which sustainability matters are material from an impact perspective, a financial perspective or both.

Typical outcomes include:

a prioritised set of material sustainability matters and the impacts, risks and opportunities connected with them;

documented thresholds and a clear rationale for the conclusions reached;

evidence linked to the organisation’s business model, operations, value chain and dependencies;

stakeholder input used to inform judgement without turning the assessment into a voting exercise;

a defined reporting scope under the applicable requirements;

outputs that can also inform strategy, enterprise risk management, governance and oversight;

an audit trail that allows the methodology, evidence and decisions to be reviewed.

The level of analysis and documentation should reflect the organisation, its operating context and the requirements that apply. More scoring, interviews or data do not necessarily make the assessment better.

What DMA enables

A well-run double materiality assessment can give an organisation a structured view of how sustainability matters connect to its impacts, dependencies, risks and opportunities.

Sharper strategic focus
DMA can show which sustainability matters may affect the business model, strategic direction or longer-term choices. It also brings significant impacts into view, including those that may not yet create a financial risk for the organisation.

Better risk discussions
The financial-materiality assessment may identify sustainability-related risks and opportunities that should be considered through enterprise risk management. It can also show where impacts, dependencies or changes in the value chain may develop into financial exposure over time.

More focused oversight
Materiality conclusions give boards and management a basis for deciding which matters require regular oversight, further investigation or escalation. They inform those decisions without replacing board or management judgement.

More consistent decisions
Documented criteria, thresholds and evidence make materiality conclusions easier to understand and challenge. They also help different functions work from the same assessment while using the findings for their own purposes.

To be clear: a DMA is not an ongoing management system; its value lies in providing a well-evidenced view that strategy, risk management, governance and reporting can use.

Double Materiality Assessments

Clarifying what actually matters

Connected insights

Interested in separating signal from noise

Flexible delivery, aligned to your organisation

What you can expect

What DMA enables

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