Materiality

Beta Version 0.1 of the TISFD Framework outlines a proposed approach to materiality (Section 4.1) and reflects it into the draft disclosure recommendations. This approach acknowledges and builds on different definitions of materiality, including financial materiality and impact materiality supporting interoperability across jurisdictions and frameworks such as ISSB, the ESRS and GRI. The approach also emphasises that understanding an entity’s impacts and dependencies on people is a necessary starting point for identifying risks and opportunities, regardless of the materiality lens applied. While these materiality lenses serve different users, the underlying information they draw on overlaps significantly, particularly information on impacts and how they are managed, which can be an early indicator of future financial effects.