This article guides you through the necessary steps after completing the double materiality analysis forms in our software. Following these steps ensures that your analysis is comprehensive, consistent, and prepared for audit purposes. Additionally, it highlights the importance of the final manual review to ensure that your company’s internal understanding of ESG materiality is accurately reflected.
1. Review and validate contextual information for audit purposes
Ensure that each question in the DMA forms has appropriate contextual information and justification where relevant. This step is crucial for audit purposes, providing transparency and traceability in the decision-making process.
The most important answers should be supported by adequate documentation or explanations that clarify how the decision was made and why certain aspects are deemed material or non-material.
You are not strictly obliged to provide those justifications for all questions. You can focus at least on the questions that mostly influenced the final materiality scores.
2. Consistency check of the Double Materiality Matrix
Review the double materiality matrix at the ESRS level ("Analytics" tab), ensuring that all results align with your company’s understanding of ESG impacts, risks, and opportunities.
Perform a general consistency check to verify that the matrix captures all relevant material topics without contradictions or errors. Pay particular attention to the balance between environmental, social, and governance topics, ensuring that no critical aspect has been overlooked.
3. Adjusting threshold values of impact and financial materiality
Our methodology uses a default threshold value of 50% to trigger materiality (either impact or financial), meaning that sub-topics are flagged as material if their score is above this percentage. Note that for SMEs, we have automatically set the impact and financial thresholds at 75% to help you focus on what is really important for your business
Adjust the thresholds of impact and financial materiality as necessary. You may find that certain topics warrant higher or lower thresholds based on their relevance to your company. This flexibility allows you to align the matrix more closely with your organization’s actual risk tolerance and exposure.
To make these adjustments, use the threshold adjustment tool located in the matrix interface (adjustable cursors, one per materiality type).
4. Review sub-topics and drill down into detailed results
Below the matrix, you will find a table listing all sub-topics under each ESRS. Review these sub-topics to ensure that results are consistent and aligned with the company’s context.
Each sub-topic can be clicked on for more detailed information. This will display which specific questions in the DMA forms contributed to its final score for both impact and financial materiality. It is essential to verify that these questions were answered correctly and reflect the company’s situation accurately.
5. Finalize Double Materiality Assessment
Navigate to the "Analytics" screen within the module. This step allows you to officially validate which sub-topics are material and which are not (click on "Freeze my results").
You are done! With that action, you make sure that no inputs can be changed in the future, and properly triggered the materiality filters in the Data Collection module
You can click on "Modify my Results" later if you really need to modify your DMA of course. Reclicking on "Freeze my Results" will automatically update the Materiality characteristics in the Data Collection.
6. Move on to the Data Collection phase
After finalizing the materiality of each sub-topic, proceed to the data collection phase. The outcomes of the double materiality analysis will automatically define the material data points that your company must report under the CSRD.
These data points are aligned with the ESRS requirements and reflect the specific sub-topics you’ve deemed material.
