Tom Cooper Raconteur Magazine - ESG Foundation https://esgfoundation.org/category/tom-cooper-raconteur-magazine Environmental, social impact and corporate governance Mon, 28 Jul 2025 00:00:00 +0000 en-US hourly 1 https://wordpress.org/?v=6.8.3 Materiality: the new measure of sustainability https://www.raconteur.net/responsible-business/materiality-the-new-measure-of-sustainability#new_tab?utm_source=rss&utm_medium=rss&utm_campaign=materiality-the-new-measure-of-sustainability&utm_source=rss&utm_medium=rss&utm_campaign=materiality-the-new-measure-of-sustainability Mon, 28 Jul 2025 00:00:00 +0000 https://esgfoundation.org/materiality-the-new-measure-of-sustainability Materiality is used to judge the impact that a specific business risk or opportunity could have on a company and its shareholders, typically in financial terms, and therefore whether they should include it in corporate reports. For example, the cost of switching suppliers post-Brexit could be large and may affect your profits and shareholders’ decisions. But the cost of choosing one item of stationery over another is small and therefore immaterial.

Insufficient data can undoubtedly lead to an inaccurate picture of ESG impacts and perceptions of greenwashing.

Determining non-financial materiality is littered with challenges. “It tends to take three years to implement diligent TCFD reporting due to all of the governance, risk and related processes that need to be in place before meaningful climate scenario modelling can start,” says Humperdinck Jackman, managing director at advisory firm ESG PRO. “But businesses are woefully unprepared. They’ve not assembled that data, nor for other ESG factors such as around energy use, governance, employee management and human rights.”

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