Materiality: What It Is and Why It Matters

Materiality is a fundamental concept in sustainability, emphasising the significance of environmental, social, and governance (ESG) issues for businesses. The Global Reporting Initiative (GRI) defines materiality as topics that represent the organisation’s most significant impacts on the economy, environment and people. By identifying and prioritising the most relevant and impactful matters, companies can address sustainability challenges and allocate resources wisely towards the key focus areas. 

Understanding Materiality

Materiality is the recognition that certain factors or issues have a significant impact on the success and value of a business. It refers to the tangibility of a topic for a business; greater tangibility means the greater the impact it has and thus, the more material it is. Evaluating materiality involves assessing the significance of specific ESG factors to determine their relevance to your business. 

Understanding your materiality topics is crucial to establishing sustainable priorities and gaining a deeper understanding of both external and internal factors that may contribute to the company’s risk and opportunities. 

The Importance of Materiality in Sustainability

Materiality plays a vital role in enabling companies to understand ESG risks, improve areas of concern, and produce impactful sustainability reports. It fosters transparency, accountability, and stakeholder trust, enhancing brand reputation. Focusing on material ESG issues allows businesses to ensure long-term sustainability; by capitalising on emerging opportunities, mitigating risks and building resilience. Effective prioritisation of material issues leads to meaningful progress on areas that matter most to your stakeholders and allows you to focus on impactful sustainability initiatives that will have significant returns on investment. 

Applying Materiality within Sustainability 

Materiality ensures that sustainable business decisions align with stakeholder perspectives. When a business is deciding what areas of sustainability to prioritise, it is essential to gain insights from their stakeholders. By prioritising material topics based on stakeholder insights, companies can develop effective strategies that balance diverse viewpoints. 

Materiality informs business decisions, such as refining corporate responsibility programmes to address significant impacts of operations or to help develop environmental protection initiatives, based on the material issues identified. 

Materiality also plays a significant role in sustainability reporting, providing stakeholders with transparency on the company’s sustainable efforts. Moreover, incorporating materiality into sustainability reporting allows companies to address key issues and create targeted actions to minimise negative impacts and enhance positive contributions. 

Unlock the potential of materiality assessment on your sustainability journey. Choose Aubrens as your sustainability partner.


Materiality plays an important role in sustainability at every level, from decision-making to reporting to stakeholder engagement. It is a fundamental pillar of sustainability that should be embraced by companies across sectors to create positive societal and environmental impacts as well as drive long-term value for stakeholders As sustainability becomes increasingly important, understanding materiality becomes crucial for achieving a sustainable future.

For a deeper understanding of your material topics and their implications, consider partnering with Aubrens, a leading sustainability consultancy. With over a decade of experience, we help businesses implement strategic actions. Contact us to learn more about our services. 

Other Insights


Sustainability Strategy for Small and Medium-Sized Enterprises (SMEs)

With the growing concern for environmental, social, and governance (ESG)

Beyond Compliance: Developing A Sustainable Business Strategy for Climate Change Mitigation and Adaptation

Climate change is a pressing global challenge and businesses are

Sustainable Procurement: Ensuring Social and Environmental Responsibility Across the Supply Chain

In today’s interconnected economy, procurement strategy plays a significant role

Why Sustainability Frameworks Falter and Steps to Ensure Enduring Implementation

A Sustainability Framework can help guide an organisation’s Sustainability Strategy

A Value Chain Approach To Addressing Climate Change

Addressing climate change is now more crucial than ever, and

The Role of Sustainable Finance in Enabling the Low-Carbon Transition

Sustainable finance plays an important role in enabling low-carbon transition.