Climate change news and information can be overwhelming for those not working in sustainability every day. It’s helpful for everyone to understand the terms and concepts that are used to describe and define sustainability and the regulations and reporting surrounding it. This is the first of two articles that aim to demystify some of the key concepts in sustainability.
Sustainability is not simply a trend but rather a crucial aspect of any successful business strategy in all sectors. Organizations are recognizing the importance of adopting a progressive and comprehensive approach to managing their impacts on the environment and communities in which they operate. They understand they need to align their operations and their decision making with ESG standards in order to satisfy their stakeholders and to remain in compliance with an increasingly complex regulatory environment.
ESG reporting is evolving rapidly with the release of major proposals in the European Union, the United States and globally by the International Sustainability Standards Board. In January 2023, the Corporate Sustainability Reporting Directive (CSRD) came into effect in the EU and double materiality studies are a cornerstone requirement of that directive. At Sharp, we have recently completed our Double Materiality Assessment, the outputs of which become the foundation of our sustainability strategy, as well as supporting our CSRD readiness. This blog post will discuss the materiality assessment and its benefits.
Understanding Double Materiality
Traditionally, companies undertaking materiality assessments focused exclusively on the financialimpacts on the company, of issues of sustainability – an inward-looking approach. The traditional approach is valuable and can provide important insights, but it only considers one perspective.
A double materiality assessment takes a more complete perspective of sustainability by considering and measuring the company’s non-financial impacts in the wider world, society and the environment. Sharp is currently involving relevant stakeholder groups within and outside the company.
Why did we choose double materiality and what are the benefits to this approach?
Holistic Sustainability Approach
Double materiality assessments offer a more holistic and comprehensive understanding of our sustainability performance and our impacts. We can identify and prioritize significant ESG issues and opportunities for Sharp and our stakeholders. The assessment considers impact, risks, and opportunities. It will allow Sharp to develop a strategy to address stakeholder challenges and priorities more effectively.
Enhanced Risk Management
By looking at both external and internal factors, companies are better prepared to understand and mitigate risks from external factors, including climate change, supply chain challenges and interruptions, and the rapidly changing legislative landscape.
Sharp is working to collaborate and innovate with supply chain partners in order to offer more creative and sustainable packaging solutions for future and existing clients.
Improved Stakeholder Engagement
Double materiality promotes better communication and engagement with stakeholders, both internally and externally. Company’s work to aligns sustainability goals with stakeholders’ interests by understanding their concerns and expectations. This alignment builds trust, improves reputation, and strengthens relationships with customers, investors, employees, and communities.
As the world faces very real and unprecedented environmental and social challenge, companies like Sharp believe that double materiality is an essential component to improve sustainability performance and outcomes.
Sustainable Packaging Solutions
Explore Sharp’s sustainable packaging solutions by clicking here.