by Kamayani Barshilia | June 4, 2025
Whether you’re a business leader, investor, or sustainability professional, double materiality is something your company cannot afford to ignore. If 2024 was the year of Corporate Sustainability Reporting Directive (CSRD), 2025 is the year of double materiality. Companies that prioritize double materiality are saving themselves time, last-minute audit flags, money, and resources.
While CSRD timing has been delayed, double materiality assessments (a component within CSRD) are still required. We distilled the top questions around double materiality from client partners, media, and social media:
1. Why is double materiality relevant to my company?
An important unchanged component of CSRD is the requirement that companies complete a double materiality assessment. These assessments are a tool to identify topics that are material from both an impact perspective and a financial perspective as applied to both the business group and value chains. While companies have more time to complete CSRD’s reporting requirements a double material assessment is an important step to take now to lay a foundation for successful navigation of this and other sustainability reporting requirements.
2. What happened with CSRD? Is it still a requirement?
Earlier this year, the European Union proposed an “Omnibus simplification package” around its sustainability regulations that makes significant changes to reporting regulations such as the Corporate Sustainability Reporting Directive (CSRD), Corporate Sustainability Due Diligence Directive (CSDDD), the EU Taxonomy Regulation, and the Carbon Border Adjustment Mechanism (CBAM). The most impactful are those impacting those who are required to report and the deadline to do it. For example, the proposal delayed reporting and increased thresholds for CSRD reporting from large undertakings from those with 250 employees to those with more than 1,000 and either a turnover above €50 million or a balance sheet total above €25 million. In April, the European Council approved the “stop the clock” directive which postponed reporting for some entities by two years while broader adjustments are negotiated.
3. When do I have to report double materiality?
While CSRD implementation is delayed, double materiality is still a requirement, and companies need to address the key strategic pieces under CSRD promptly and not push everything back until the deadline. Below are the key deadlines for CSRD reporting. Please note that by each applicable deadline, companies are expected to have completed a double materiality assessment, obtained limited assurance from a third-party verifier, and published a CSRD-compliant report covering the material topics identified through the DMA process
- 2025: Companies already subject to the Non-Financial Reporting Directive (NFRD), e.g., large listed companies with >500 employees
- 2025 (Now 2027): Other large EU companies (Defined as meeting at least two of these criteria: 250 employees, €40M turnover, or €20M total assets)
- 2026 (Now 2028): Listed small and medium-sized enterprises
- 2029: Non-EU companies generating >€150M turnover in the EU, with a significant EU presence
4. Why does this matter for my business?
Understanding double materiality isn’t just about compliance—it’s about clarity. Companies raising the level of sustainability reporting to “meet” financial reporting helps support economic and business resilience. Double materiality provides a more complete, transparent, and responsible view of a company’s impacts and risks. It allows organizations and stakeholders to understand how sustainability issues affect the company with financial materiality and how the company affects society and the environment with impact materiality. This integrated perspective helps identify blind spots, uncover innovation opportunities, and mitigate long-term risks like climate disruption or supply chain vulnerabilities.
Double materiality isn’t just another box to check—it’s a new way of thinking about business, risk, and responsibility. Now’s the time to act—not just because you have to, but because it’s smart business. ClimeCo’s experts can help your team understand the implications of double materiality for your business. Contact us to learn how we can help make this process easy.
About ClimeCo
ClimeCo is an award-winning leader in decarbonization, empowering global organizations with customized sustainability pathways. Our team of respected scientists and industry experts collaborates with companies, governments, and capital markets to develop tailored ESG and decarbonization solutions. Recognized for creating high-quality, impactful projects, ClimeCo is committed to helping clients achieve their goals, maximize environmental assets, and enhance their brand. Partner with ClimeCo to drive meaningful environmental change and take your climate initiatives to new heights.
Contact us at +1 484.415.0501, info@climeco.com, or through our website climeco.com.
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