What Is The SASB Materiality Map?
The SASB Materiality Map is the gateway tool for businesses to create a more sustainable world around them. Specifically, it’s meant to help companies identify and prioritise sustainability issues that are directly related to their industry and business.
In a world where people are more conscious of their environmental responsibilities, people expect businesses to be at the forefront and aware of the various issues. After all, businesses are contributing much more to climate change through carbon emissions and higher water usage to create goods, among other things.
SASB Materiality Map
The SASB Materiality Map is clearly directed towards businesses and has specific attributes as follow:
Industry-specific: Each materiality map is different in that it’s tailored specifically for the industry that the business is in. Through this specific attribute, it looks at providing understanding of the more material issues of that industry.
Identification of material issues: From that general overview, the map narrows down and quantifies these issues by putting them into categories. Each category is, of course, relevant to the appropriate industry the map is meant for. But the nice thing about the map is that it ties into issues beyond ESG, such as climate change overall, particular labour practices, and product safety.
Prioritisation system: With all the information out in the open, the map enables companies to set priorities. It makes it easy to identify what kind of issues businesses should tackle by pointing out what is the most material issue based on financial performance and stakeholder interests.
Disclosure guidance: In addition to helping set priorities, the map also provides disclosure guidance and standards for the material issues. In other words, when companies start reporting on this matter, the map provides clear guidelines on what must be done and what is needed to provide sufficient information on the matter.
Integration with financial reporting: Lastly, the map will also integrate sustainability with financial reporting. It helps businesses as well as investors recognise that various sustainability factors do have a material impact on the viability of the company as well as its financial performance.
Related: Why Companies Are Becoming B Corporations: All You Need to Know
Why Is The Map Important?
The materiality map is important for several key reasons. Not only does it play a clear role in sustainability reporting, but it also provides:
Risk Mitigation: Again, because it shows very real and material issues for the company that should be prioritised, businesses can avoid the risk in the future by addressing the problem right now.
Investor Communication: The reports and the clear instructions on how to disclose information allow investors to make better business decisions about the company. It also adds more transparency for communities, employees, and people overall who can make better decisions about the company if they read these reports.
Creates Transparency: The only way companies are able to build trust with people is by being transparent about what they are doing and what they are reporting. Materiality maps help companies be clear about what is important and how to build trust.
Complies with Regulations: As sustainability reporting becomes mandated or heavily encouraged, using a materiality map makes the reporting process simpler, faster, and creates fewer mistakes.
Strategic Decision-Making: Knowing what is material for a company obviously contributes to its overall strategy and survivability. It helps to know what kinds of risks could occur for companies and how to best address them before they become bigger issues.
Everyone Needs A Map
Ultimately, maps provide easy directions and markers, and a SASB materiality map is no different. It creates a lot of clarity and direction for businesses to push themselves towards and what issues need to be tackled now rather than later.
Accessing this map is also very easy. Check it out on the SASB website.
