Material on impact only
Material under the ESRS: impacts count whether or not they are financially material (¶35).
Often off the top-right corner.Materiality · presenting the results
Materiality matrix: a picture of the assessment, not the assessment
A materiality matrix is a chart that plots sustainability matters on two axes so that the most important ones stand out.
No standard requires one: the revised ESRS never mention a matrix, GRI 3 allows a visual, and UK SRS S1 asks for none.
Drawn carelessly it misstates a double materiality assessment, because the ESRS test is either lens, not both.
What it is
What a materiality matrix actually shows
A materiality matrix is a common way to present prioritised sustainability matters, usually as a scatter chart with two axes.
In a double materiality version one axis carries impact materiality and the other financial materiality, the two limbs of Article 19a(1) of the Accounting Directive.
The chart is a presentation of conclusions the assessment has already reached; it does not decide anything by itself.
Read where the matrix sits in the reporting process
The work that decides materiality is the materiality assessment, and under the ESRS that is the double materiality assessment set out in Chapter 3 of the revised ESRS 1.
The matrix is one of several ways to show the result to a board, an assurance provider or a reader, alongside a ranked list or a table.
A matrix is a practice, not a standard: none of the three main frameworks read for this page defines its axes, scales or shape.
The concept the two axes try to capture is explained on double materiality, and the wider meaning of the word on materiality explained.
Two axes, one pictureExplore
Module 01 / 04
Impact axis
How significant the company’s impacts on people and the environment are.
Module 02 / 04
Financial axis
How likely and how large the financial effects on the company are.
Module 03 / 04
The matters
Topics or sub-topics, each placed by the conclusions the assessment reached.
Module 04 / 04
The thresholds
Lines the company sets and records; no standard supplies the numbers.
The ESRS position
The revised ESRS ask for a process and results, not a materiality matrix
The phrase “materiality matrix” does not appear anywhere in Delegated Regulation (EU) 2026/1563, the revised ESRS published in the Official Journal on 21 September 2026.
What the standards require is the assessment itself, the thresholds used and the results, disclosed in ESRS 2.
Read what the disclosures ask, and how a matrix fits
ESRS 2 IRO-1 asks for a description of the process, including the methodologies, inputs, assumptions and the qualitative considerations or quantitative thresholds applied.
IRO-2 asks for the material impacts, risks and opportunities and a list of the disclosure requirements met, and it requires the basis for any conclusion that climate change is not material.
SBM-3 then connects the material matters to strategy and the business model.
A company may still include a matrix as an illustration, provided the chart agrees with what IRO-2 reports.
For FY2026 an undertaking may apply the 2023 ESRS, the 2023 ESRS with eight reliefs, or the revised ESRS in full, and must say which; none of the three versions requires a matrix.
EFRAG’s IG 1 was written for the 2023 standards and is non-authoritative, and EFRAG’s guidance page lists no implementation guidance for the revised ESRS as at 11 October 2026.
What ESRS 2 asks forExplore
Module 01 / 04
IRO-1
The process: steps, methods, inputs, thresholds, and when the assessment was last updated.
Module 02 / 04
IRO-2
The results: material impacts, risks and opportunities, and the disclosure requirements met.
The trap
Either axis is enough: the rule a matrix most often breaks
Revised ESRS 1 ¶35 says “Impacts can be material exclusively from an impact perspective, irrespective of whether they are financially material.”
So a matter that crosses the threshold on one axis is material even if it sits at zero on the other, and four companies’ published choices are compared under double materiality examples.
Read how a matrix turns either into both
Many matrices highlight only the top-right quadrant, where both scores are high.
Read that way, the chart quietly applies a both-or-nothing test the ESRS do not contain.
The honest version draws each threshold as its own line, so that everything right of one line or above the other reads as material.
The same applies to the financial side: ¶36 asks the undertaking to add risks and opportunities that do not arise from its impacts, such as physical risks, and those sit high on the financial axis with no impact score at all.
The same matter often scores differently on each axis, which is exactly the information a single combined score would hide.
One matter, two assessments
Material on finance only
Material under the ESRS, and the natural candidate for UK SRS S1.
Physical risk is the classic case (¶36).Material on both
Material, and the matter a matrix usually highlights.
Material on neither
Not reported: immaterial ESRS information “shall not” be disclosed (¶24).
Except supplementary information under §8.2.How a matrix misstates the assessment
Six ways a materiality matrix goes wrong
A matrix compresses several separate rules into two numbers, and each compression can change a conclusion.
These six are the ones the revised ESRS 1 rules out most directly.
Read each error with its rule
Both, not either
Impacts can be material exclusively from an impact perspective (¶35).
Draw two thresholds, not one corner.
Averaging severity
AR 22: “Any of the three characteristics (scale, scope and irremediable character) can make a negative impact severe.”
An average can drop a severe impact.
Likelihood applied to actual impacts
¶40 assesses actual negative impacts on severity; likelihood enters only for potential impacts.
Impacts plotted net of planned policies
¶43 counts prevention and mitigation only where implemented and reasonably effective; AR 27 excludes a policy that merely implies future actions.
Positive impacts netted
¶44: positive impacts are assessed on their own, without netting against negative impacts.
Likelihood burying a human rights impact
¶40: for a potential negative human rights impact, severity takes precedence over likelihood.
Source: revised ESRS 1, Delegated Regulation (EU) 2026/1563, Chapter 3, which applies to financial years beginning on or after 1 January 2027.
Six common errorsExplore
Module 02 / 06
Averaging severity
Any one of scale, scope and irremediable character can make an impact severe (AR 22).
Module 03 / 06
Likelihood on actuals
Actual negative impacts are assessed on severity alone (¶40).
Module 04 / 06
Planned policies
A policy implying future actions is not considered on its own (AR 27).
Module 06 / 06
Human rights
For potential human rights impacts, severity takes precedence over likelihood (¶40).
GRI
GRI 3 allows a visual, and asks you to document the threshold
GRI 3: Material Topics 2021 is the framework that comes closest to the matrix habit, and it treats a picture as optional.
Step 4 says the organisation should arrange its impacts from most to least significant, define a threshold and document it.
Read GRI 3’s wording
GRI 3 says “Where to set the threshold is up to the organization. For transparency, the organization can provide a visual representation of the prioritization”.
It also says “The significance of an impact is the sole criterion to determine whether a topic is material for reporting.”
So a GRI picture has one dimension that matters, significance of impact, and a second financial axis would be adding a test GRI does not apply.
Severity in GRI 3 uses the same three characteristics as the ESRS, scale, scope and irremediable character, with likelihood for potential impacts.
The disclosures are 3-1 on the process, 3-2 on the list of material topics and 3-3 on how each is managed; the GRI Standards guide covers the rest of the system.
GRI 3, Step 4Explore
Module 02 / 04
Threshold
Define a cut-off point and document it; where to set it is up to the organisation.
Module 03 / 04
Visual
The organisation “can provide a visual representation of the prioritization”.
Module 04 / 04
One criterion
Significance of the impact is “the sole criterion”; there is no financial axis.
UK SRS
UK SRS S1 has one lens, so it has no matrix to draw
UK SRS S1 applies single (financial) materiality: information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that primary users of general purpose financial reports make (¶18).
With only one lens, a two-axis matrix has nothing to put on its second axis.
Read how UK SRS frames materiality
¶3 frames the risks and opportunities in scope as those that could reasonably be expected to affect the entity’s cash flows, its access to finance or cost of capital over the short, medium or long term.
¶B19 says the Standard “does not specify any thresholds for materiality or predetermine what would be material in a particular situation.”
The ISSB’s educational material of November 2024 makes the same point and adds that materiality is an entity-specific characteristic of information.
A UK company may still rank its sustainability-related risks and opportunities on likelihood and magnitude, but that is a risk register, not a double materiality matrix.
How UK SRS S1 applies the test is on UK SRS materiality, and the standard itself on UK SRS S1.
UK SRS S1 materialityExplore
Module 01 / 04
¶18
Material if it could reasonably be expected to influence primary users’ decisions.
Module 03 / 04
¶B25
Immaterial information need not be disclosed, even if listed as a minimum requirement.
If you want one
How to build an honest double materiality matrix
A matrix is safe when it is drawn from a finished register and checked back against it.
The steps beside this text keep the picture faithful to the rules it summarises.
Read the build steps in detail
Start from the register of matters, each with its impact assessment, financial assessment, threshold test and conclusion.
Set each axis to the scale you used and mark the threshold you recorded, because the ESRS set no numeric scale and say quantitative scoring “is not necessarily required” (AR 13).
Draw the impact threshold as a vertical line and the financial threshold as a horizontal one, so that both the impact-only and the financial-only regions read as material.
Plot sub-topics where the assessment concluded at sub-topic level, since ¶30 limits reporting to the material information for the sub-topic.
Mark actual and potential impacts differently, so that a reader can see where likelihood was and was not applied.
Keep the register underneath the chart for assurance: the limited assurance opinion covers “the process carried out by the undertaking to identify the information reported” (Art 34(1)).
Assurance of the process is covered on sustainability assurance.
- 1
Finish the register first
Every matter with its scores, threshold test and conclusion, before any chart.
- 2
Define the axes from your thresholds
Use the scales and thresholds you recorded under ¶37; there is no standard scale.
- 3
Draw two lines, not one corner
Material right of the impact line or above the financial line (¶35).
- 4
Plot conclusions, not averages
Severity as concluded, never a mean of scale, scope and irremediability (AR 22).
- 5
Reconcile to IRO-2
Every material matter on the chart appears in the statement, and nothing more.
From register to chart
A materiality matrix build, step by step
This sequence is an illustration of one way to order the work, not a timetable any standard prescribes.
The chart comes last because it can only show what the assessment has already concluded.
- 01 / Assess01
Run the assessment
Impacts first, then risks and opportunities, under the version of the ESRS that applies. - 02 / Record02
Record thresholds and conclusions
Qualitative or quantitative, applied consistently and kept for assurance. - 03 / Axes03
Draw the axes from the recorded scales
One axis per lens, each with its own threshold line. - 04 / Plot04
Plot the conclusions
Severity as concluded, potential impacts marked, positive impacts plotted separately. - 05 / Reconcile05
Check against IRO-2
Every material matter on the chart is in the statement, and immaterial ones are not presented as reported. - 06 / Review06
Revisit at the reporting date
Redraw only if significant changes alter the conclusions.
A working template
A materiality matrix template, built from the register
No standard sets a template, so this is an illustrative working format, not an ESRS form.
Each row is one matter; the chart is drawn from the last four columns.
| Field | What it holds | Where the rule is |
|---|---|---|
| Matter | The impact, risk or opportunity in plain words | Revised ESRS 1 ¶25 |
| ESRS topic and sub-topic | E1–E5, S1–S4 or G1, and the sub-topic | Revised ESRS 1 ¶¶26, 30 |
| Impact type | Actual or potential; negative or positive; human rights or not | Revised ESRS 1 ¶¶39–41 |
| Scale, scope, irremediable character | The three severity characteristics, assessed separately | Revised ESRS 1 ¶40, AR 22 |
| Impact likelihood | For potential impacts only | Revised ESRS 1 ¶¶40–41 |
| Financial magnitude and likelihood | For risks and opportunities | Revised ESRS 1 ¶50 |
| Thresholds applied | The lines you set and recorded | Revised ESRS 1 ¶37, AR 13 |
| Conclusion | Material on impact, on finance, on both, or neither | Revised ESRS 1 ¶35 |
| Evidence | Due diligence, data, engagement, date of last update | Revised ESRS 1 ¶42; ESRS 2 IRO-1 |
The same register serves GRI 3 if you drop the financial columns, and a UK SRS risk register if you drop the impact columns.
A worked scoring grid for one matter at a time is on the double materiality assessment guide.
Materiality matrix example
An illustrative double materiality matrix, read correctly
The matters, scores and thresholds below are invented to show the reading, and describe no real company.
The company is an illustrative EU logistics business that scores each axis 1 to 5 and treats 3 or more as material on either axis.
Read the illustrative example
| Matter | Impact score | Financial score | Top-right reading | Correct ESRS reading |
|---|---|---|---|---|
| Excessive hours among subcontracted drivers | 4 | 1 | Not material | Material on impact (¶35) |
| Flood risk to a depot | 1 | 4 | Not material | Material on finance (¶36) |
| Diesel fleet emissions | 5 | 4 | Material | Material on both |
| Water use in offices | 1 | 1 | Not material | Not material; not reported (¶24) |
The top-right reading drops two of the three material matters, which is the whole case against reading a matrix by its corner.
Under UK SRS S1 only the financial axis would be assessed, so the flood risk and the emissions would be candidates and the drivers’ hours would enter only if they affected cash flows, access to finance or cost of capital.
How the two lenses differ in general is on single vs double materiality.
Four illustrative mattersExplore
Module 01 / 04
Supplier working hours
High impact, low finance: material on impact alone.
Module 02 / 04
Flood risk to a depot
Low impact, high finance: material on finance alone.
Module 03 / 04
Fleet emissions
High on both: material, and in the top-right corner.
The instruments, by date
When the rules behind a materiality matrix were set
None of these instruments requires a matrix, but each shapes what an honest one can show.
Dates are as at 11 October 2026.
- 1 January 202301
GRI 3 takes effect
For reports published on or after this date: rank impacts, document the threshold, a visual is optional. - 31 July 202302
First ESRS adopted
Delegated Regulation (EU) 2023/2772 makes double materiality the basis of the sustainability statement. - 31 May 202403
- 3 July 202604
Revised ESRS adopted
The Commission adopts the simplified standards; EFRAG had given technical advice. - 21 September 202605
Published in the Official Journal
Delegated Regulation (EU) 2026/1563; no mention of a matrix anywhere in the act. - FY2027 onwards06
Revised ESRS apply
Financial years beginning on or after 1 January 2027; FY2026 has three options and the version must be stated.
UK groups with EU reach
One register, two pictures
A UK group whose EU subsidiary reports under the ESRS can keep one register and draw from it twice.
The joint ESRS–ISSB interoperability guidance says the ESRS definition of financial materiality is aligned with the definition of materiality in IFRS S1.
Read how one register serves both
The financial axis of the ESRS matrix is therefore the natural starting point for the group’s UK SRS judgements.
The impact-only matters stay on the EU side unless they would affect cash flows, access to finance or cost of capital.
When the CSRD reaches a UK group at all is set out on the CSRD and UK SRS comparison, and the scope test is undertakings exceeding both 1,000 employees and €450 million of net turnover from financial year 2027.
Before you draw anything
Finish the assessment, record the thresholds, then decide whether a chart helps anyone.
A ranked table that matches IRO-2 line for line is never wrong; a matrix only adds value if it is drawn to the same rules.
One evidence baseExplore
Module 03 / 04
Aligned definition
The ESRS financial-materiality definition is aligned with IFRS S1.
Frequently asked
Questions people ask
What is a materiality matrix?
A materiality matrix is a chart that plots sustainability matters on two axes so that the most important ones stand out.
In a double materiality version, one axis usually shows impact on people and the environment and the other shows financial effect on the company.
It is a way of presenting the results of a materiality assessment, not the assessment itself.
Is a double materiality matrix required by the CSRD?
No. The phrase “materiality matrix” does not appear anywhere in Delegated Regulation (EU) 2026/1563, the revised ESRS, and nothing in the standards asks for a chart.
The ESRS require the process, the thresholds and the results to be disclosed in ESRS 2 IRO-1 and IRO-2.
Does GRI require a materiality matrix?
No. GRI 3 says the organisation should rank its impacts, set and document a threshold, and that for transparency it “can provide a visual representation of the prioritization”.
A matrix is one possible visual, and providing one is a choice.
Does UK SRS use a materiality matrix?
No. UK SRS S1 applies single (financial) materiality, judged by whether information could reasonably be expected to influence the decisions of primary users of general purpose financial reports. It specifies no thresholds (¶B19) and asks for no chart.
What goes on the axes of a double materiality matrix?
Usually impact materiality on one axis and financial materiality on the other.
Each axis should be defined from the thresholds the company has recorded, because the ESRS set no numeric scale and qualitative analysis may be enough (AR 13).
Why can a matrix misstate a double materiality assessment?
Because the ESRS test is either-or.
Revised ESRS 1 ¶35 says impacts can be material exclusively from an impact perspective, so a matter high on one axis is material even at zero on the other.
A matrix that only highlights the top-right corner turns that into a both-or-nothing test.
Can I average scale, scope and irremediable character to plot an impact?
Not under the ESRS.
AR 22 says any one of the three characteristics can make a negative impact severe, so an average can push a severe impact below the line.
Plot the severity the assessment actually concluded.
Should a matrix show impacts before or after planned policies?
Before any policy that is only planned.
AR 27 says a policy that implies future actions shall not be considered on its own in assessing an impact, and ¶43 counts prevention and mitigation only where it is implemented and can reasonably be assumed to work.
Can positive impacts sit on the same matrix as negative ones?
They can be shown, but never netted.
Revised ESRS 1 ¶44 says positive impacts are assessed on their own, without netting against negative impacts, and compliance with the law is not a positive impact.
Is there an official materiality matrix template?
No. Neither the ESRS, GRI 3 nor UK SRS S1 prescribes a template.
The working format on this page is an illustration of the fields a register usually holds, not a form any standard sets.
What does the ESRS ask for instead of a matrix?
ESRS 2 IRO-1 describes the process, methods, inputs, thresholds and when the assessment was last updated; IRO-2 lists the material impacts, risks and opportunities and the disclosure requirements met; SBM-3 links them to strategy and the business model.
Do I need to update the matrix every year?
Only if the assessment changes.
Revised ESRS 1 ¶34 asks the undertaking to consider at each reporting date whether significant changes affect its conclusions, and UK SRS S1 ¶B28 asks for materiality judgements to be reassessed at each reporting date.
Can an immaterial topic appear on the matrix?
On an internal working chart, yes, as part of showing the screen.
In the ESRS sustainability statement, information that is not material “shall not” be disclosed, apart from supplementary information under section 8.2 (¶24), so keep the published picture consistent with what the statement reports.
Sources
Primary sources
Every figure, date and status on this page traces to the instrument’s owner.
Secondary commentary is never the source for a number.
Checked against 12 sources fromEUR-LexCouncil of the EUEFRAGEuropean CommissionGlobal Reporting InitiativeDepartment for Business and Trade
- EUR-LexCommission Delegated Regulation (EU) 2026/1563 — revised ESRS 1, Chapter 3, and Articles 2–3
The assessment rules: either lens is enough (¶35), severity (¶40, AR 22), thresholds (¶37, AR 13). The word “matrix” appears nowhere in the act.
- Council of the EUC(2026) 5010 final, Annex I — the revised ESRS as transmitted
The same standards before Official Journal publication.
- EFRAGESRS Knowledge Hub — revised ESRS 2, IRO-1, IRO-2 and SBM-3
What the sustainability statement says about the assessment process and its results.
- European CommissionCommission adopts revised sustainability reporting standards, 3 July 2026
The adoption of the simplified ESRS.
- EUR-LexCommission Delegated Regulation (EU) 2023/2772 — the first ESRS
The 2023 standards, still one of the FY2026 options.
- EUR-LexDirective 2013/34/EU, consolidated 18 March 2026 — Art 19a(1)
The two limbs of EU sustainability reporting that the two axes of a matrix try to show.
- Global Reporting InitiativeGRI 3: Material Topics 2021 — Step 4 and Disclosures 3-1 to 3-3
The organisation sets and documents its threshold and “can provide a visual representation of the prioritization”.
- Department for Business and TradeUK SRS S1 General Requirements — ¶¶17–18, B19, B25, B28
No thresholds specified; immaterial information need not be disclosed; judgements reassessed each reporting date.
- IFRS FoundationSustainability-related risks and opportunities and the disclosure of material information — educational material, November 2024
Materiality is entity-specific and ISSB Standards specify no thresholds; not part of the Standards.
- EFRAGIG 1: Materiality Assessment Implementation Guidance (May 2024)
Non-authoritative and written for the 2023 ESRS.
- EFRAGESRS implementation guidance documents — project page
No guidance for the revised ESRS is listed as at 11 October 2026.
- IFRS Foundation / EFRAGESRS–ISSB Standards Interoperability Guidance, 2 May 2024 — §1.1
The financial-materiality definitions are aligned; the ESRS add the impact lens.
Continue reading
Read next
The method
The double materiality assessment
The ESRS method the matrix should summarise, step by step.
Process
Materiality assessment, any framework
The same work for UK SRS, GRI or the ESRS.
One lens
Impact materiality
Severity, likelihood and the impact axis in detail.
The other lens
Financial materiality
Likelihood, magnitude and the financial axis in detail.