Materiality Assessment Is an Art, Not a Science: Selecting ESG Topics for Sustainability Reports

Materiality assessments play an important role in helping firms to select the environmental, social, and governance (ESG) topics to include in their sustainability report. This article presents the six main steps of materiality assessments, the methods used, and how the complexity, uncertainty, and...

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Bibliographic Details
Published in:California management review 2022-11, Vol.65 (1), p.64-90
Main Authors: Garst, Jilde, Maas, Karen, Suijs, Jeroen
Format: Article
Language:English
Subjects:
Environmental governance
Governance
Sustainability
Sustainability reporting
Topics
Uncertainty
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Summary:Materiality assessments play an important role in helping firms to select the environmental, social, and governance (ESG) topics to include in their sustainability report. This article presents the six main steps of materiality assessments, the methods used, and how the complexity, uncertainty, and evaluative nature of sustainability issues complicate them. This article draws two conclusions: the selected materiality perspective influences how the other steps are conducted, and assessment results should not only focus on selecting win-win scenarios, but also on “tensioned topics,” which indicate material societal impact but lack a business case.
ISSN:0008-1256
2162-8564
DOI:10.1177/00081256221120692