What is double materiality?
Double materiality is the EU’s distinctive approach to sustainability disclosure scope, codified in the Corporate Sustainability Reporting Directive (CSRD, Directive (EU) 2022/2464) and operationalised through the European Sustainability Reporting Standards (ESRS). A topic is “material” if it meets either of two perspectives — financial materiality (impact on enterprise value, risks/opportunities) or impact materiality (the organisation’s actual or potential impacts on people and the environment).
Two perspectives
- Financial materiality (outside-in): sustainability matters that could reasonably be expected to affect the entity’s cash flows, financial position, access to finance, or cost of capital over the short, medium or long term. Aligned with IFRS S1/S2 baseline.
- Impact materiality (inside-out): the entity’s actual or potential positive/negative impacts on people or the environment over the short, medium or long term — including its own operations and value chain.
Materiality assessment process
- Identify topics across ESRS sustainability matters (climate, pollution, water, biodiversity, circular economy, workforce, communities, consumers, business conduct).
- Engage stakeholders (workers, communities, value chain partners) to inform impact assessment.
- Assess severity, scope, irremediability for negative impacts; likelihood and magnitude for financial effects.
- Set thresholds for inclusion in mandatory disclosures.
- Document methodology — auditors test the materiality assessment.
Türk şirketleri için
AB CSRD kapsamı 2024’ten itibaren AB’de iş yapan büyük üçüncü ülke şirketlerini de kapsar (AB net cirosu eşiği üzeri); raporlama 2028 mali yılı için 2029’da. Türk büyük şirketleri AB-iştiraki üzerinden veya doğrudan AB satışı ile CSRD’ye girdiklerinde çifte önemlilik metodolojisini uygulamak zorundadır. KGK’nın TSRS uygulaması finansal önemlilik odaklıdır; CSRD’nin impact materialitisi ek katmanı gerektirir.
Do: conduct a formal double materiality assessment with stakeholder input; document the methodology; refresh annually or on material business changes.
Don’t: equate financial materiality alone (IFRS S1/S2) with CSRD double materiality — the impact lens is mandatory under ESRS.