In Search of Double Materiality in Non-Financial Reports: First Empirical Evidence

Tiziana De Cristofaro and Carmela Gulluscio ()
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Tiziana De Cristofaro: Department of Economic Studies, University “G. d’Annunzio” of Chieti-Pescara, 65127 Pescara, Italy
Carmela Gulluscio: Department of Law and Economic Sciences, Unitelma Sapienza University, 00185 Rome, Italy

Sustainability, 2023, vol. 15, issue 2, 1-30

Abstract: Materiality is the key principle that drives the selection of issues that companies must report on. The European Union regulation on companies’ non-financial disclosure coined a special meaning of materiality that holistically combines the two perspectives of financial and impact materiality into an overall “double materiality” (DM). The contrast detected between the early debate and the low level of empirical knowledge on DM provided by the literature on materiality disclosure gave rise to our research aim, which was to map the pioneering experiences of DM. In order to achieve this aim, we carried out an exploratory analysis on the non-financial reports of 58 companies, both European and non-European, operating in various industries (period 2019–2021). The results reveal “traces” of DM in the reports of few companies, mainly European ones. The aspects we examined, both with atomistic and summative perspectives of inquiry, highlight variety in both double materiality assessments and adoption disclosures, as well as related criticalities. This foreshadows a fragmented landscape of materiality analysis disclosure over the next few years that presently requires great attention and increased operational guidance by the international standard setters involved. The article closes by proposing implications, limitations and research perspectives.

Keywords: double materiality; impact materiality; financial materiality; dynamic materiality; materiality disclosure; European Sustainability Reporting Standards (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
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