𝐄𝐒𝐆 𝐃𝐨𝐮𝐛𝐥𝐞 𝐌𝐚𝐭𝐞𝐫𝐢𝐚𝐥𝐢𝐭𝐲 𝐈𝐧𝐬𝐢𝐝𝐞 & 𝐎𝐮𝐭

#Sharing This summarized infographic for a Carousel posted by 𝐂𝐥𝐢𝐦𝐚𝐭𝐞 titled “𝐄𝐒𝐆 𝐃𝐨𝐮𝐛𝐥𝐞 𝐌𝐚𝐭𝐞𝐫𝐢𝐚𝐥𝐢𝐭𝐲 𝐈𝐧𝐬𝐢𝐝𝐞 & 𝐎𝐮𝐭” explains the concept of double materiality within the framework of Environmental, Social and Governance (ESG).

This approach evaluates both the internal financial impacts on a company (financial materiality) and the external effects on stakeholders and the environment (stakeholder materiality).

𝘒𝘦𝘺 𝘚𝘦𝘤𝘵𝘪𝘰𝘯𝘴 𝘌𝘹𝘱𝘭𝘢𝘪𝘯𝘦𝘥:

𝐖𝐡𝐚𝐭 𝐢𝐬 𝐃𝐨𝐮𝐛𝐥𝐞 𝐌𝐚𝐭𝐞𝐫𝐢𝐚𝐥𝐢𝐭𝐲?
It refers to a comprehensive evaluation that considers both the internal financial impacts on the company and the external impacts on stakeholders and the broader environment.

𝘍𝘪𝘯𝘢𝘯𝘤𝘪𝘢𝘭 𝘔𝘢𝘵𝘦𝘳𝘪𝘢𝘭𝘪𝘵𝘺:
Focuses on assessing how ESG factors can affect a company’s financial performance, risk profile and long-term viability.

𝘚𝘵𝘢𝘬𝘦𝘩𝘰𝘭𝘥𝘦𝘳 𝘔𝘢𝘵𝘦𝘳𝘪𝘢𝘭𝘪𝘵𝘺:
Involves understanding the impact of a company’s activities on external stakeholders, including the environment, society and local communities.

𝐒𝐭𝐞𝐩𝐬 𝐭𝐨 𝐀𝐬𝐬𝐞𝐬𝐬 𝐃𝐨𝐮𝐛𝐥𝐞 𝐌𝐚𝐭𝐞𝐫𝐢𝐚𝐥𝐢𝐭𝐲:

𝘌𝘴𝘵𝘢𝘣𝘭𝘪𝘴𝘩 𝘵𝘩𝘦 𝘚𝘤𝘰𝘱𝘦:
Define the scope of the assessment, identifying relevant ESG factors and industries.

𝘐𝘥𝘦𝘯𝘵𝘪𝘧𝘺 𝘌𝘚𝘎 𝘍𝘢𝘤𝘵𝘰𝘳𝘴:
Identify key internal and external stakeholders, define relevance to industry, and recognize potential ESG factors based on various guidelines and standards.

𝘌𝘹𝘵𝘦𝘳𝘯𝘢𝘭 𝘚𝘵𝘢𝘬𝘦𝘩𝘰𝘭𝘥𝘦𝘳 𝘔𝘢𝘵𝘦𝘳𝘪𝘢𝘭𝘪𝘵𝘺 𝘈𝘴𝘴𝘦𝘴𝘴𝘮𝘦𝘯𝘵:
Engage with stakeholders to assess the impact of the company’s operations on external parties and the environment.

𝘐𝘯𝘵𝘦𝘨𝘳𝘢𝘵𝘪𝘰𝘯 𝘢𝘯𝘥 𝘗𝘳𝘪𝘰𝘳𝘪𝘵𝘪𝘻𝘢𝘵𝘪𝘰𝘯:
Integrate internal and external assessments, prioritize significant ESG factors.

𝘙𝘦𝘱𝘰𝘳𝘵𝘪𝘯𝘨 & 𝘊𝘰𝘮𝘮𝘶𝘯𝘪𝘤𝘢𝘵𝘪𝘰𝘯:
Incorporate material ESG factors into corporate reports, ensuring clarity and transparency regarding material issues to both internal and external stakeholders.

This model helps companies navigate complex sustainability challenges by addressing both financial implications and the broader societal consequences of their operations.