CSRD Materiality Assessment Process

Deutsche Börse Group’s (DBG) double materiality assessment follows a multi-step approach to identify the most material sustainability matters in accordance with the European Sustainability Reporting Standards (ESRS). For more details please see the graphic below. 

The double materiality assessment starts with building the foundation to be able to evaluate DBG’s impact on environmental, social and governance factors (impact materiality assessment) and to consider how these factors influence the organisation (financial materiality assessment):

Step 1 – Description of DBG’s value chain

The essential first step is to create a value chain to illustrate DBG’s upstream and downstream activities as well as DBG’s core business. 

Step 2 – Long list of sustainability matters

Next, DBG draws up a long list of sustainability matters considering ESRS sustainability matters as well as possible DBG-specific sustainability matters. To ensure a comprehensive long list further resources e.g., previous materiality assessments are considered.

Step 3 – Stakeholder analysis

In line with the Corporate Sustainability Reporting Directive (CSRD)/ ESRS requirements as well as previously performed materiality assessments, DBG identifies relevant stakeholder groups including both affected stakeholders and users of sustainability reporting. The identified stakeholder groups are then mapped to internal DBG functions. This ensures that an internal stakeholder representative stands for every relevant stakeholder group. 

Step 4 – Short list of sustainability matters

In order to determine whether the previously identified sustainability matters are indeed material, a short list of sustainability matters is defined. This is done by evaluating the connection of the sustainability matters to DBG’s value chain. Sustainability matters that have no connection to DBG’s value chain are sorted out. 

Step 5 – Stakeholder mapping to short list

The previously identified stakeholder groups and their representatives are allocated to the shortlisted sustainability matters. 

After the foundation is established, the actual materiality assessment is conducted. Together with the representatives of affected stakeholders and subject matter experts the impacts, risks and opportunities are identified: 

Step 6 – Impact materiality assessment

Once sustainability matters have been identified, the impacts based on the short-listed sustainability matters are assessed taking time horizons and representatives of the sustainability statement users and affected stakeholders into consideration. Thresholds are defined to clarify which of the sustainability matters will be covered in the sustainability statement. 

Step 7 – Financial materiality assessment

The next step is to identify risks and opportunities as a basis for the determination of material sustainability matters based on the assessment of risk scenarios for the determination of material sustainability matters and the determination of thresholds. 

Step 8 - Consolidation of the materiality assessment

The list of material sustainability matters from the financial and impact materiality assessment are consolidated. The result includes all material sustainability matters that are either material from impact perspective, financial perspective or both. A final assessment of relevance is performed to identify applicable disclosure requirements for DBG.