DataSolmu blog
Keep Materiality Visible Before Actions Exist
Keep material sustainability matters visible, even before the organisation has decided on a response.
When a sustainability matter is material, the absence of a policy, action or target is not a reason to make it disappear from view. It is a fact that reporting teams, management and readers need to understand.
The same separation helps when teams use classification or eligibility information in their assessment. A signal from a Taxonomy process can be useful evidence for finding topics to investigate. It cannot make the materiality decision on its own.
EFRAG's May 2024 materiality assessment guidance explains these points in the context of the 2023 ESRS. It is non-authoritative and does not determine the requirements for a later reporting period. The workflow below is DataSolmu's practical approach for keeping the underlying judgement, evidence and response status clear.
Separate The Matter From The Response
Start with the materiality question: what impact, risk or opportunity has the organisation identified, where does it arise, and what evidence supports the conclusion? Record that judgement before considering whether a policy, action plan or target already exists.
Then record the response status plainly. An established control, a proposed initiative, a budget request and no current response are different states. Combining them into a reassuring label can make a material matter look resolved when the evidence says otherwise.
A useful decision record connects the matter, relevant entities or activities, evidence considered, known limitations, response status, owner and next review date. It gives the reporting team a way to improve the response without rewriting the original judgement.
Make Absence Reviewable
No action in place is not a dead end. It is a prompt for a clear management decision: accept the current position, develop a response, collect missing evidence, or revisit the materiality conclusion when facts change.
For example, a team might identify a workforce safety impact while finding that there is no formal training programme or target. The evidence record should retain both facts. A future programme may be relevant to next year's assessment, but it should not be presented as a completed response before it operates and can be evaluated.
This also improves assurance preparation. A reviewer can see which conclusion was made, what response was available at the reporting date and which open questions remain, rather than trying to infer the story from a policy document alone.
Use Taxonomy Signals As Inputs, Not Verdicts
Classification, activity and environmental-objective information can help a team identify areas that deserve a closer look. They may point to operations, capital plans, technical criteria or potential environmental effects that should enter the evidence review.
The next step is still a materiality assessment. Consider the organisation's own activities, value chain, affected people and environment, financial effects, available evidence and uncertainty. A label or eligibility result cannot replace that contextual judgement.
Keep the link visible: note the signal that prompted the review, the evidence gathered afterwards, the conclusion reached and the reasons a topic was retained, escalated or not assessed as material. This protects against both shortcuts: treating a screening signal as an automatic disclosure decision, or ignoring a useful signal because it is not decisive.
Create A Simple Review Gate
Before approving a public statement, ask:
- What is the material matter and what evidence supports the conclusion?
- Are policy, action and target statuses described as they stood at the reporting date?
- Does any classification or Taxonomy information serve as an input rather than an unsupported verdict?
- Who owns the next response decision, and when will the evidence be reviewed again?
Varmennappi can help teams make missing evidence, action status and review dates visible before public wording is approved. It does not provide legal advice, auditor assurance, regulator acceptance or a guarantee of filing compliance; the reporting organisation remains responsible for its final judgements and professional review.
Practical Takeaway
Keep the materiality judgement, response status and screening inputs separate but connected. That makes it easier to explain a material matter honestly today and to show how the organisation will improve its response over time.
Source
EFRAG IG 1: Materiality Assessment Implementation Guidance — May 2024