Understanding how the questions in each ESRS form relate to the final materiality scores is crucial for accurate reporting of your double materiality results. Let's break this down in detail.
General scoring methodology
In the end, the materiality scores (impact or financial) are computed at sub-topic level (e.g. "energy consumption" is a sub-topic of the "Climate Change" ESRS/topic). With that approach, we would have several scores for each topic/ESGS. To deduce the materiality score at ESRS/topic level, we choose the sub-topic with the highest score.
This means the materiality score is determined by the answer to ONE question, related to ONE sub-topic of the ESRS.
Also, keep in mind that each question addresses the main levels of your value chain, meaning the company's own operations, suppliers and final clients. So the materiality scores will be influenced by both your answer type and the impact / risk / opportunity location in the value chain.
1. Initial Materiality Check Questions
These questions are designed to quickly identify if an ESRS is potentially material to your company. They typically ask about your company's involvement in activities related to the ESRS topic.
Example: For ESRS E3 (Water and Marine Resources), you might be asked: "Does your company consume water or marine resources in any way, face risks associated with water scarcity, or see opportunities for more sustainable water use practices?"
Relation to Scores: A "Yes" answer doesn't directly contribute to the numerical score but triggers the need for further assessment. A "No" answer, if justified and approved, may result in the ESRS being classified as non-material without further scoring.
2. Impact Assessment Questions
These questions delve into specific activities and their potential impacts, contributing to the impact materiality score.
Example: "Does your value chain involve the operation of any facilities that may release pollutants into the atmosphere?"
Relation to Scores: Your answers here directly inform the Scale, Scope, Remediability, and Likelihood scores for each impact. For instance, a question about the geographic spread of an impact contributes to the Scope score
3. Stakeholder Reaction Questions
For impacts identified as potentially material (exceed a 50% impact materiality score), you'll be asked about possible stakeholder reactions.
Example: "How would you characterize the potential reaction of regulatory bodies to this impact?"
Relation to Scores: Your answers contribute to the Type, Strength, Time Horizon, and Likelihood scores for stakeholder reactions. For instance, indicating a strong negative reaction from regulators would result in a high Strength score and a negative Type score
4. Resource Dependency Questions
These questions assess your company's reliance on various resources related to each ESRS.
Example: "How sensitive is your company's operations to changes in water availability?"
Relation to Scores: Your responses directly inform the Sensitivity, Time Horizon, and Likelihood scores for resource dependencies. A high sensitivity to water availability would result in a high Sensitivity score
Do the mapping between Answers and Materiality scores
To trace back the origin of the scores, please follow this process:
Determine which ESRS and which type of materiality (impact, financial) you want to check
Export your detailed form answers with the "Export Materiality Scores" button, located in the "Analytics" tab
Go to the Question_Level_Data
In this tab, each line corresponds to one question of the ESRS forms
Filter the "associated_esrs" column with the ESRS value you determined at step 1.
Filter the "materiality_type" column with the materiality type you determined at step 1.
Sort the filtered lines by descending percentage score value
use the "impact_materiality_percentage_score" column if you study impact materiality
use the "financial_materiality_percentage_score" column if you study impact materiality
The first line of the generated results corresponds to the question that generated the materiality score value of the selected ESRS