The brochure contains guidelines for industry-specific materiality analysis and is intended to support BDI member associations in identifying industry-specific impacts, risks, and opportunities (IROs) as well as the associated material sustainability issues. It can also be used to identify industry-wide material disclosure requirements and data points. Furthermore, it can provide companies subject to reporting requirements with initial guidance—based on industry-specific preliminary considerations—for the mandatory company-specific materiality analysis.

Background on the New Sustainability Reporting

The CSRD will require approximately 49,000 companies in the EU and third countries to report on sustainability, including around 14,600 companies headquartered in Germany. The associated mandatory reporting standards, the ESRS (European Sustainability Reporting Standards), specify the reporting requirements of the CSRD (Corporate Sustainability Reporting Directive). So far, only the first set (known as “Set 1”) of twelve cross-sector ESRS has been published. In addition, further SME-specific ESRS, sector-specific ESRS, and ESRS for companies in non-EU countries are in the planning stages.

Implementing the new requirements poses a wide range of challenges, particularly for the many thousands of companies newly subject to reporting obligations, which include a large portion of small and medium-sized enterprises (SMEs). These companies will be required to report on sustainability for the first time for fiscal years beginning on or after January 1, 2025. In particular, the mandatory company-specific materiality analysis covering the entire value chain represents a significant bureaucratic burden for companies.

Concept of the Company-Specific Materiality Analysis

Only those sustainability disclosures that are associated with material sustainability-related impacts, risks, or opportunities must be reported (the concept of double materiality). Given the complexity of the materiality analysis, guidance to help navigate the industry-specific materiality analysis is essential. These preliminary considerations provide companies with initial guidance for their company-specific materiality analysis, thereby helping them reduce the effort required to determine their individual disclosure obligations.

Important: The materiality analysis must always be conducted on a company-specific basis in accordance with the requirements of ESRS 1 and is the sole responsibility of the reporting company. The brochure can therefore serve only as a preliminary guide and does not relieve companies of their responsibility to conduct their own materiality analysis.

This brochure is the second joint publication by the BDI and the DRSC, following the highly successful first edition, which provided basic information and tips on the new sustainability reporting requirements under the CSRD.