THE CONCEPT OF MATERIALITY IN THE ESG REPORTING PROCESS
Abstract
The article is devoted to current issues related to defining the essence of the concept of «materiality» in the context of ESG reporting as one of the key principles ensuring the transparency of ESG disclosure. An analysis of research trends on the topic of «materiality» for the period 2019–2024 has been conducted, revealing a growing interest in this issue among the scientific community. The main scientific approaches to interpreting materiality, based on regulatory frameworks (GRI, ESRS, IFRS, SASB, TCFD) and authorial concepts, have been identified. Based on the analysis of international standards and scientific studies, an updated definition of «materiality» in the context of ESG reporting is proposed, integrating mathematical and statistical methods, expert judgment, and alignment with stakeholder information requests. It has been established that the identification of material aspects of ESG reporting should consider not only past data but also the prospects of the company, as well as the evolving expectations of key stakeholders. As part of the study, a bibliometric analysis of scientific publications was conducted using the R package «Bibliometrix» allowing for an assessment of global scientific activity in the field of ESG reporting. The geography of research has been analysed, and key academic centres actively developing this topic have been identified. It has been found that the most popular topics include ensuring transparency in non-financial reporting, assessing the impact of environmental and social factors on business operations, and methodological approaches to defining materiality. An adaptation of an existing approach to determining material topics within ESG reporting has been proposed, which includes a six-step process for analysing and evaluating information with stakeholder participation. It has been proven that this methodology fully aligns with the characteristics of materiality defined by the author and can be used to enhance the validity of corporate decision-making. Future research prospects include developing practical mechanisms for integrating materiality assessment into ESG reporting and ensuring compliance with international standards.
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