Verifiable materiality analysis in accordance with CSRD and ESRS.
RITTWEGER and TEAM is your ESG expert for materiality analyses within the framework of CSRD reporting obligations and ESRS. With our clarity and expertise in regulations, understanding complex relationships, and practical implementation, we support your materiality process. We are familiar with the requirements and dynamic developments in the market. Our goal is to provide you with a precise and robust basis for audit-ready ESG reports and reliable decision-making foundations for your transformation strategy.
Double Materiality Analysis – Core Component of the CSRD Report According to ESRS
The double materiality analysis is a central element of sustainability reporting according to the European Sustainability Reporting Standards (ESRS). In practice, the materiality analysis typically serves to create a solid foundation for sustainability, CSR, or ESG reports. Additionally, it provides a well-founded basis for developing sustainability ratings and decarbonisation strategies. The concept of double materiality is applied here. This concept involves two perspectives for assessing the materiality of sustainability issues according to ESRS:
- Financial Materiality
The impact of sustainability on the company
(Outside-in) - Impact Materiality
The company’s impact on sustainability
(Inside-out)
We support you with the dual materiality analysis in accordance with CSRD and ESRS and guide you through the entire development process.
Experience and expertise in the materiality process: practical materiality analysis for a feasible transformation strategy
RITTWEGER and TEAM supports corporate management, corporate communications and sustainability management with a materiality process tailored to the company, in defining and prioritising material issues. Once a company’s material issues are identified, they should be regularly reviewed within the structured process. The relevance of these material issues is verified through stakeholder dialogue and validated through risk and data analyses within the framework of risk and sustainability management. The materiality process represents a structured approach for the regular execution of a materiality analysis and forms the basis for precisely aligning the company’s sustainability or transformation strategy with progressively changing topics. It is crucial for liability protection and fulfilling due diligence according to ESG criteria.
Auditability to International Standards
To simplify the materiality/reporting process and reduce internal coordination efforts, RITTWEGER and TEAM use an “ESRS report template,” whose concept is based on various audit scenarios from different auditors and complies with current standards of data quality and disclosure. The goal of having an auditor review the sustainability reporting is to ensure the robustness of data quality, enhance transparency, relevance, and credibility, as well as ensure the comparability of information. The audit requirements are established in auditing standards, with the International Standard on Assurance Engagements ISAE 3000 (Revised) currently being applicable for other business audits. Specific auditing standards for sustainability reporting, such as ISSA 5000, are still under development.
How do we ensure the substance and auditability of materiality?
Targeted stakeholder dialogues via online surveys
Stakeholder dialogues review the material issues and integrate current perspectives and interests of stakeholders into the materiality process. Through stakeholder surveys, such as an online survey for employees, which RITTWEGER and TEAM handle entirely, current risk and opportunity assessments of material issues are captured.
Plausibility check through over 100,000 data sources
To validate the topics identified in the materiality analysis and ensure that all relevant aspects are taken into account, we utilise the functionality of EcoVadis’ 360° Watch. This provides relevant public information on a company’s sustainability practices, collected from over 100,000 data sources, including NGOs, the press and trade unions.
Site-specific biodiversity check with the help of AI
This method enables companies to precisely assess their impact on nature and their dependence on biodiversity – both on a site-specific basis and along the entire value chain. Locations and industries are analysed using an AI-based algorithm and a comprehensive database that includes local and global information.
Analysing the CO2e reduction path according to Science Based Targets (SBTi)
As part of the materiality analysis, the largest sources of emissions in scopes 1 to 3 are identified and considered, evaluated and prioritised according to SBTi in line with the 1.5-degree reduction pathway. The aim is to define the most significant emission levers – particularly in Scope 3 – and to be able to underpin them with specific reduction measures.
Extension of ESRS to GRI conformity
ESRS reporting can be extended to GRI standards by carrying out a reconciliation with the simultaneously applicable GRI requirements. This harmonisation makes it possible to achieve interoperability between ESRS and GRI standards and thus to report in accordance with the GRI standards. This harmonised approach ensures that reporting meets both ESRS and GRI requirements and leads to clearer and more consistent reporting.
Our services for your materiality according to CSRD and ESRS:
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- Workshop-based introduction, assessment and definition of the target image of the materiality analysis
- Conducting the materiality analysis according to ESRS via long list to short list and categorising the material topics in the materiality matrix
- Collection and visualisation of the stakeholder structure
- Advice on and/or implementation of a stakeholder dialogue via targeted online surveys
- 360° Watch plausibility check via EcoVadis
- Assessment of STB (Science-Based Targets) goals, biodiversity, and social stand
- Definition of material Scope 3 categories according to GHG
- Preparation of a materiality analysis report
- Workshop-based development of a company-specific materiality process for global risk and opportunity analyses
- Further support with the implementation of the materiality process
- Collection and visualisation of the stakeholder structure
Good to know.
What exactly is the double materiality analysis?
The dual materiality analysis is considered the key to successful CSRD reporting and the strategic transformation of a company. It encompasses the need to consider both financial materiality and environmental and social materiality in reporting. Companies must use a dual materiality analysis to disclose how sustainability issues affect their financial position (outside-in-perspective),and how their business activities impact the environment and society (inside-out-perspective). A well-structured Materiality matrix thelps to clearly identify and prioritise these aspects to ensure that all relevant sustainability issues are included in the report.
