Financial materiality: Difference between revisions
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In the context of sustainability reporting, European Sustainability Reporting Standards (ESRS) define a sustainability matter as material from a financial perspective if: | In the context of sustainability reporting, European Sustainability Reporting Standards (ESRS) define a sustainability matter as material from a financial perspective if: | ||
:It generates risks or opportunities that affect (or could reasonably be expected to affect) the undertaking’s | :(i) It generates risks or opportunities that affect (or could reasonably be expected to affect) the undertaking’s | ||
:Financial position, financial performance, cash flows, access to finance or cost of capital | :(ii) Financial position, financial performance, cash flows, access to finance or cost of capital | ||
:Over the short, medium or long term. | :(iii) Over the short, medium or long term. | ||
:''(Source - Annex 2 - abbreviations and definitions - supplementing Directive 2013/34/EU of the European Parliament and of the Council as regards sustainability reporting standards - European Commission.)'' | :''(Source - Annex 2 - abbreviations and definitions - supplementing Directive 2013/34/EU of the European Parliament and of the Council as regards sustainability reporting standards - European Commission.)'' | ||
Revision as of 13:23, 5 June 2024
1. Financial reporting - risk management - ESG - sustainability reporting - European Sustainability Reporting Standards (ESRS).
In the context of sustainability reporting, European Sustainability Reporting Standards (ESRS) define a sustainability matter as material from a financial perspective if:
- (i) It generates risks or opportunities that affect (or could reasonably be expected to affect) the undertaking’s
- (ii) Financial position, financial performance, cash flows, access to finance or cost of capital
- (iii) Over the short, medium or long term.
- (Source - Annex 2 - abbreviations and definitions - supplementing Directive 2013/34/EU of the European Parliament and of the Council as regards sustainability reporting standards - European Commission.)
2. Financial reporting - risk management.
More broadly, any assessment of materiality from a financial point of view.
See also
- Assurance
- Audit
- Double materiality
- Double materiality assessment
- ESG
- European Commission
- European Financial Reporting Advisory Group (EFRAG)
- European Sustainability Reporting Standards (ESRS)
- Financial reporting
- Guidance
- Guide to risk management
- Immaterial
- Impact
- Impact materiality
- Material
- Material by nature
- Materialistic
- Materiality
- Materiality assessment
- Risk
- Risk management
- Sustainability reporting
- Sustainability statement
Other resources
- [https://data.consilium.europa.eu/doc/document/ST-12481-2023-ADD-2/en/pdf Annex 2 - abbreviations and definitions - supplementing Directive 2013/34/EU of the European Parliament and of the Council as regards sustainability reporting standards - European Commission
- EFRAG Implementation Guidance - Materiality Assessment
