[Double Materiality module]
The materiality assessment of IROs (Impacts, Risks and Opportunities) needs to be performed by each company based on their own knowledge and understanding of the company, operations and business model, through their Subject Matter Experts (SMEs).
SMEs need to assess specific criteria for impact and financial materiality. In some specific cases, they might need to engage with affected stakeholders for the assessment.
The Datamaran’s IRO Hub allows for scoring the different criteria on the platform, to calculate the final IRO score. Datamaran uses a default 1 to 5 scale to assess IROs.
IRO scores are calculated as follows:
Magnitude * Likelihood / 5 (for risks and opportunities) and Severity * Likelihood / 5 (for impacts). This score is used to define the final materiality threshold at IRO level.
Select a topic to see all the IROs. Select a specific IRO to open the details and score its criteria. You can also add the reasoning for the assigned values.
For Risks & Opportunities, the criteria to assess are:
- Classification (current/anticipated)
- Time horizon
- Magnitude
- Likelihood
For Impacts, the criteria to assess are:
- Classification (current/anticipated)
- Time horizon
- Scale
- Scope
- Likelihood.
Negative impacts also require:
- Irremediability.
Severity is calculated as follows: (Average(Scale, Scope, Irremediability*) + Max(Scale, Scope, Irremediability*)) / 2
*If applicable, it is only for Negative Impacts.
As you progress in the IRO assessment, the IRO view will reflect the latest progress.
You can also map IROs to ESRS-AR16 at this stage.
You can view the IROs in two ways:
By criteria
By score:
Refer to this document for additional information on the assessment scales used for the IRO dimensions.
Datamaran also supports custom criteria scales. Learn more here.