Barbara Strozzilaan 336
1083 HN Amsterdam
The Netherlands
gssbsecretariat@globalreporting.org

Item 09 – GRI Universal Standards
Project – Public comment feedback
on GRI 103: Material Topics
For GSSB information
Date

8 February 2021

Meeting

25 February 2021

Project

GRI Universal Standards Project

Description

This document contains an extract of public comments related to GRI 103:
Material Topics in the Universal Standards exposure draft, which was madeavailable for public comment between 11 June and 9 September 2020.
The document presents the comments received via the online survey and via
letters, for GSSB reference.
Note to reading the comments:
Comments have been included verbatim. Where a respondent has raised several
distinct points in one comment, each point has been numbered and presented in a
separate row. The point number is indicated in brackets before the verbatim
comment. In addition to this, comment numbers have been included in the firstcolumn to help facilitate the discussion during the meeting on 25 February.

This document has been prepared by the GRI Standards Division and is made available to observers
at meetings of the Global Sustainability Standards Board (GSSB). It does not represent an official
position of the GSSB. Board positions are set out in the GRI Sustainability Reporting Standards. The
GSSB is the independent standard setting body of GRI. For more information visit
www.globalreporting.org.

© GRI 2021

1

Contents2

Public comments ..................................................................................................................................... 33

1. General comments on GRI 103: Material Topics ............................................................................ 34

2. Comments on Section 2. Identifying material topics ....................................................................... 45

3. Comments on Section 3. Reporting on material topics ................................................................. 33

Page 2 of 48

6

Public comments

7

1. General comments on GRI 103: Material Topics

8

Please refer to pages 77-98 in the Universal Standards exposure draft.

9

Table 1. General comments on GRI 103: Material Topics

No.

Name oforganization orindividualCountry

Stakeholder
group

Submission
type(1) In my opinion, this is the most breakthrough change that has been
introduced by this revision together with the new structure of thestandards.
The provision of a stand-alone standard concerning the management
approach that should be adopted together with a topic-specific standard
sounded more complex than it really was. In this way new GRI adopters
can easily understand that management approach is an integrated partof the material topic reporting process and that reporting on a specifictopic means also describing how this topic is recognized and tackled by
the entity.
(1) This is an improvement on the previous Man. App. Disclosures andclarifies materiality as impacts of not impacts on the business, andemphasizes process in determining materiality.

Alessandro Mantini

Italy

Business

As an individual

Beyond Business Ltd

IsraelNo response(4) It seems that there is an over emphasis on identifying material
impacts and risks whilst not enough on detailing how they will be
addressed and remediated and, in the case of future potential harmful
impacts, prevented.
(1) 1. We believe GRI 103 should reinforce the message that it ismandatory to report the list of material topics.

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

PwC

UnitedKingdom

Assurance
providerOn behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,

Comment12

34Page 3 of 48

group or
institution
10

2. Comments on Section 2. Identifying material topics

11

Please refer to pages 82-89 in the Universal Standards exposure draft.

12

Table 2. Comments on Section 2. Identifying material topics
Name oforganization orindividualCountry

Stakeholder
group

Submission
type(3) In second step should incluide the concept of risk analysis to identify
the negative impacts. Many companies are working with risk
management policies o procedures or departments and is like this
aspect is out of GRI Standards(1) Very clear the steps procedure.

AG Sustentable

Argentina

Consultant

AG Sustentable

Argentina

Consultant

3(2) In some how there should be more visual difference between thedescription of the first three steps, and the description of the fourth stepthat is (or should be) a requirement itself.

AG Sustentable

Argentina

Consultant

4

Are there any concerns that other companies may self-censor material
topics that their stakeholders may wish to be reported on. In ourcompany, there is already a robust system of stakeholder engagement
across various platforms. This may not be the case for other companies.
I very much support the move from stakeholder-led materiality
assessments to using a broader, richer evidence base. I think thischange reflects current best practice which combines stakeholder input
with market and operation context, national and international trends,
expert views etc and removes the risk of skewing the materiality
assessment by choosing a narrow set of external stakeholders.

Aldo Joson

Singapore

Business

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
As anindividual

Alexandra McKay

UnitedKingdom

Consultant

No.

Comment
1

2

5

As an
individual

Providing a methodology for ranking these topics also removes some ofPage 4 of 48

6

7

8

9
10

11
12

the guess work from meeting the standard although flexibility should bebuilt in to allow for the evolution of best practice in the market place
I would recommend including as an Annex tools and guidance alreadydeveloped by think tanks, Human Rights Institutions or consulting firms
on how undertake impact assessment (human rights impact
assessments) for further consultation.
The responsibility of the reporting organization is extended on its real or
possible impacts that it may cause on the main stakeholders in theentire value chain, however a limit or methodology should be defined tofacilitate the scope of action on the negative aspects that theorganization can manage.
We support the revisions re: identifying material topics; in particular lines
2347-2351 on workers who are not employees, lines 2370-2375 oncompliance with international human rights standards including
workplace human rights, lines 2394-2420 (Box 1) on engaging withstakeholders and respecting their rights, and lines 2500-2545 on
assessing the significance of negative impacts are important.
ref. lines 2466-2473 for the financial sector, and even though theintentions are always good, this is very challenging !
(2) The thing that is missing is more detailed guidance (audit-worthy) on
how to actually define material. This remains vague - scale and scopeand likelihood may be useful guidance, but these will be interpreted inmillions of ways by companies. Perhaps GRI should consider providing
a more detailed guide for materiality and what constitutes scale at thehigh and low levels etc. For example, for some, climate change is amaterial topic, for others, renewable energy is a material topic, forothers, it's energy efficiency. The definition of the material topic may be
so broad that it could apply to any company, or so narrow that thesignificance is understated in reporting. There needs to be betterguidance on the underlying approach to what's a material topic versus ageneric sustainable development priority.
Sensible revisions.
(2) It is difficult for company to draw the degree/relationship of thenegative impacts in a clear manner (especially when it comes to Macroissues such as pollution or environmental-related issues). The company
may end up downplaying the impacts. From a reader's perspective, thedistinction between these 3 concepts may not be straight forward andAna María González
Ruiz

Colombia

Consultant

As anindividual

Angel Castillo

EcuadorConsultant

As anindividual

Australian Council ofTrade Unions

Australia

Labor
representative

On behalf of anorganization,group orinstitution

Bank Audi sal

LebanonNo response

No response

Beyond Business Ltd

IsraelNo response

On behalf of anorganization,group orinstitution

Bondt Communicatie

Netherlands

No response

No response

Bursa Malaysia

Malaysia

Stockexchange

On behalf of anorganization,group orinstitution

Page 5 of 48

have little meaning.

13

14

15

Sustainability impacts are often the product of qualitative, subjective
judgements. It would be challenging to differentiate the impacts as suchgiven the interpendencies.
(1) It is unclear as to why the process for identifying impacts needs to be
so rigid, i.e. in identifying the negative first before the positive impacts.
Should more flexibility be granted.
Suggest to provide guiding principles or prescriptions to provide
guidance to report on material and substantial issues that can havedemonstrable impacts to people and society. This can include precise
differentiation between positive and negative impacts from company's
operations.
As a reporter: To clarify the definition of "material topic" and practicalway of prioritisation, following the proposal to take out the "influence on
the assessments and decisions of stakeholders" as a standalone factor
that determines whether a topic is material. Although it provides more
flexibility for the organisation to determine what is material, it mightleave too much room for interpretation.
Suggest to provide guiding principles or prescriptions to provide
guidance to report on material and substantial issues that can havedemonstrable impacts to people and society. This can include precise
differentiation between positive and negative impacts from company's
operations. As an exchange: Agreed. More specifically, assessment ofoverall significance of impact based on severity (scale, scope &irremediable character) and likelihood is highly subjective, especially for'potential' ones. Should provide added guidance or 'tools' to guide theapproach.
In order to support connectedness between financial and non-financial
disclosure, we would recommend that, within the process to identify andprioritise material topics on the basis of negative impacts on theeconomy, environment and people, further consideration is given to theconnectedness of sustainability and financial disclosure. Whilst is
acknowledged that the intended stakeholder audience for disclosure
under the GRI Standards is broader stakeholder groups beyond just

Bursa Malaysia

Malaysia

Stockexchange

On behalf of anorganization,group orinstitution

Bursa Malaysia

Malaysia

Stockexchange

On behalf of anorganization,group orinstitution

CDSB

UnitedKingdomStandard
setterOn behalf of anorganization,group orinstitution

Page 6 of 48

investors, it is important that consistency is achieved between thedisclosure topics presented to investors in the mainstream report andadditional disclosures, such as sustainability reports intended for a wider
stakeholder audience.

16

17

As the proposed approach to identifying material topics for sustainability
reporting considers only actual and potential impacts on the economy,
environment and people, and does not consider impact on enterprisevalue creation, potential disclosure topics may be omitted fromsustainability reporting, which may impact enterprise value creation andtherefore be relevant for disclosure to investors within the organisation’s
mainstream report. Accordingly, it is recommended that a clearer meansof linking the proposed process to identify material topics to enterprisevalue creation is considered, in order to support consistency indisclosure topics between the annual report and wider sustainability
reporting. This will enable organisations to use information prepared inaccordance with the GRI Standards, concerning impacts on theeconomy, environment and people, to disclose upon a sub-set ofsustainability topics which are considered to be material for enterprisevalue creation, within the mainstream report.
(2) On the same principle, the specification of a threshold to determinematerial topics to report (line 2563-2567) could be difficult if determinedbased on a company’s outward influence only. There is currently nouniversal standard on how to measure and quantify impact. To reiterate
the recommendations made under Q1, considering the impacts thatexternal factors have on the company could make determination of thethreshold more objective.
GRI 103 2 Identifying material topics
This section is deeply flawed. In practice what is material is not solely
determined by the size of impact but by the values, tradition, history andaspirations of the organisation concerned. This needs to be thought
about and reflected in the process proposed for identifying what ismaterial. The process described is at odds with what actually goes onwhen an organisation thinks about what is material. GRI has spent wellover two decades acknowledging (and indeed promoting) this truth. It
cannot be wished away. The process should be amended to include thevalues, tradition, history and aspirations of the reporting organisations.

CLP Holdings Ltd.

Hong kongBusiness

On behalf of anorganization,group orinstitution

Corporate
Citizenship

UnitedKingdom

No response

No response

Page 7 of 48

18
19

20

21

22

23

24

25

The proposed revisions and the guidance are useful for the reportingorganisation.
(1) The difference between contributes and impact of a business
relationship is not clearly explain neither on GRI nor on OECD
guidelines. GRI should make their own definition setting a clear
boundary on different types of impact (e.g: internal vs external).
(2) I suggest adding a list of proposed activities for each step: E.g:
Analysing community surveys, + press analysis, + environmental impact
analysis. (in terms of the companies project, specific tasks)(4) DIHR finally recommends that national human rights institutions areadded to the list of experts the organisation can consults to test its
material topics in line 2593.

CSRWorks
International
Daniela Winicki

Singapore

No response

No response

Chile

Consultant

As anindividual

Daniela Winicki

Chile

Consultant

As anindividual

Danish Institute for
Human Rights

Denmark

National
human rights
institution(2) Re GRI 103 section 2, step 4, Line 2559-2599 The DIHR
recommends that Step 4 makes clear that in all cases severe humanrights impacts should be prioritised for reporting, to prevent that severe
human rights impacts for whatever reason are excluded from theorganisation’s own prioritisation of material topics for reporting incl.
through their determination of a given threshold.
(1) Regarding line 2366-2367: The DIHR recommends specifying
consideration of human rights as part of the context parameters listed
e.g. ‘ economic, social, including human rights, and environmental
challenges…
(3) DIHR also recommends that box 3 (line 2581 onwards, makes clearthat GRI Topic and Sector Standards do not constitute an exhaustive listof topic names for material topics.

Danish Institute for
Human Rights

Denmark

National
human rights
institution

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Danish Institute for
Human Rights

Denmark

National
human rights
institution

Danish Institute for
Human Rights

Denmark

National
human rights
institution(1) GRI SRS is well known like the reporting standards that promote theengagement of the organization’s stakeholders not only into thecommunication during the reporting period, but especially in thereporting process itself. If the organization wants the report to befocused on the interests and requests of stakeholders, they should be
asked directly. The engagement of stakeholders only into thedetermination of impacts seems to be vague procedure. Especially in
Russia.
The engagement of stakeholders into the reporting process is thebiggest the advantage of materiality assessment and GRI SRS. If the

Da-Strategy

RussianFederation

Consultant

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Page 8 of 48

26

27

28

29

organization attracts into the materially consultation process only
experts, it reduces the assessment. The experts are the people of theknowledge, not of the interest. Contrariwise stakeholders have their
particular interests. Experts could be biased by the organization itself,
and it could happened that organization would manipulate the experts
and would get what it want instead of getting a fresh look at thereporting and request for transparency.
(1) As it was already mentioned that we support the engagement of
stakeholders into the materiality assessments, not the experts due tothe possible manipulation.
(3) More clarity instead would be needed in the section concerning
identifying impacts (line 2384-2420). The main limitation: identification of
actual and potential impacts appears to be de facto equated to
stakeholder consultation. Is consultation the only means (and the bestone) to understand the concerns of stakeholders? It doesn't seem so, asin the subparagraph on identification of negative impacts (lines 24292435), the exposure draft provide a richer description of what kind ofevidence can be used to identify actual and potential impacts. The
exposure draft doesn’t help to clarify the difference between
consultation and information gathering. The ambiguity is not a small
one: it concerns the difference between conducting a materiality
assessment exclusively based on surveys vis-à-vis collecting a broader
corpus of evidence. It would be beneficial to harmonize the explanationand make a clear distinction between consultation vs information
gathering, and explain how the two activities can reinforce each other.
(4) Finally, concerning the approval of the highest governance body(lines 2594-2595), it would key that the exposure draft explains in moredetail how this body is expected to perform the task: are boards
supposed to ask questions? Which questions? What kind of
documentation do they need to approve the identified material topics?
(2) The exposure also indicates that the organization “should use asystematic, replicable, and documented approach to identify its material
topics”. These indications are a helpful clarification of what themateriality assessment process entails, ensuring that it is evidence
based. In order to make that clearer, it would be beneficial that the point
explaining what "documented" means (line 2316) includes also the

Da-Strategy

RussianFederation

Consultant

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Datamaran

UnitedStatesDigitalplatform

Datamaran

UnitedStatesDigitalplatform

On behalf of anorganization,group orinstitution

Datamaran

UnitedStatesDigitalplatform

On behalf of anorganization,group orinstitution

Page 9 of 48

30

31

32

33

"sources analyzed and evidence gathered", along with the "approach,assumptions, and decisions taken".
(1) The revision clarifies that the steps involved in identifying material
topics include an “organization’s ongoing identification and assessmentof impacts as part of its regular activities in order to manage its
impacts”, and only at the end “the identification of material topics forreporting”. This is an important distinction to highlight how materiality
assessments are useful for reporting purposes, but should beembedded in companies existing risk and opportunities identificationand monitoring processes.
(3) Materiality
While we think the first phase of the newly developed guidance forundertaking a materiality assessment will be useful for longstanding
reporters, we think determining significance of impacts will remain achallenge for all reporters because they can be hard to evaluate
accurately (particularly in terms of quantification and measurement,
timing, and access to data). We also wish to encourage greater
consistency in approaches to evaluating material topics to increase therobustness of the exercise and user confidence in reporters’
assessment of materiality.
(1) Lines 2311 – 2322 Identifying Material Topics: GRI should change“be transparent about” (Line 2321) to “document”. There are threebullets in this section. Tso say “document”, and the third says
“transparent”. “Document” implies that the organization would do thisfor internal purposes, for its own clarity and records, and to haveinformation available for internal or external audit. “Be transparent
about” implies public disclosures, as in a GRI report. These two terms
conflict, and are confusing.
(2) Line 2320 Identifying Material Topics: The Standards state that, anorganization should … apply the steps to identify material topics
consistently over time, and document any changes to the approach
along with their implications (Line 2320). GRI should add “and therationale for those changes” to the statement at Line 2320. The broad
objective of sustainability reporting is to encourage more transparencyon (especially) non-financial topics. However, organizational
management does not always trend in this direction. New management
or financial pressures can cause organizations use many mechanisms –Datamaran

UnitedStatesDigitalplatform

On behalf of anorganization,group orinstitution

Deloitte

UnitedStatesConsultant

On behalf of anorganization,group orinstitution

Douglas Hileman

UnitedStatesConsultant

As anindividual

Douglas Hileman

UnitedStatesConsultant

As anindividual

Page 10 of 48

34

35

36
37

38

such as reducing the number of material topics or eliminating some thatare embarrassing – that reduce transparency.
Identification of material topics and related impacts. GRI should specify
that shareholder filings that achieve more than a specified positive vote(say, 10%) should be considered as a material topic, and subject toreporting during the reporting period and for a reasonable number of
future reporting periods. GRI should require the organization to at least
report on their programs, procedures, performance and commitment tothe underlying topic for these shareholder filings. Publicly-traded
companies are owned by shareholders; the Highest Governing Body
(HGB) serves at the pleasure of the shareholders. There are provisions
in many jurisdictions for shareholders to submit initiatives that would
require the organization to address sustainability topics. It is altogether
too common for the HGB to recommend against these initiatives,
organizational management to campaign against them. These
initiatives are rarely binding, even if they achieve the majority of theshareholder vote. There is likely no other indicator of a material topic, or
one that should demand the attention and response of the HGB thanthose that achieve a positive response from a reasonable share ofowners of the organization. This commenter realizes that shareholder
proxy filings can be poorly written, overly broad, or infeasible. Still, they
are a valid indication of concerns of the stakeholder group that can hire
and fire the HGB.
(2) In addition, the guidance introduces 'severity' and 'likelihood' which
are vague measures; which could lead to a less transparent process indetermining material topics.
(4) The likelihood calculation is vague and potentially confusing.
(3) The second comment relates to lines 2385-2386; the sentence on
consulting internal and external expertise signify that it is optional when
it is a crucial part of the process.
(2) The first and most significant current shortcoming is identifying thematerial topics based on the ownership structure. The GRI attempted todefine the business relationship and business partners, yet the revisions
do not address the downside of using ownership control in determining
companies that are included and excluded in the reports. GRI REP-2 (a, -b, and -c) attempt to vaguely touch on the subject and define

Douglas Hileman

UnitedStatesConsultant

As anindividual

Dr Aljaohra Altuwaijri

Saudi Arabia

Academic

As anindividual

Dr Aljaohra Altuwaijri

Saudi Arabia

Academic

Dr Aljaohra Altuwaijri

Saudi Arabia

Academic

As anindividual
As anindividual

Dr Aljaohra Altuwaijri

Saudi Arabia

Academic

As anindividual

Page 11 of 48

39

40

‘consolidated group’ and ‘minority interest’ (1021-1024); while GRI 103
list ownership structure as one of the factors to consider in the processof identifying the material topics; yet no concrete remedy is proposed.
This limitation is substantial, particularly in regions and industries that
depend on JVs as the main business relationship with MNCs. For
example, partnerships in the Arabian Gulf is built on JV agreements, inmany instances, the ownership of international companies will be lessthan 50%; which has permeated the exclusion of ventures that are
owned by 40% in the parent company reports. This impacts themateriality topics and the accuracy of the reported data, as well as ourunderstanding of the actual progress towards global sustainability.
(1) It is not clear how the new guidance will overcome the transparency
and quality issues seen in the current materiality approach. The
definition of material topics has many limitations and skew thefundamental part of sustainability reports to the hands of theorganisations away from stakeholders.
Need to focus more UN Guiding Principles on Business and Human
Rights and how companies work with UN GLOBAL COMPACT on this.

Dr Aljaohra Altuwaijri

Saudi Arabia

Academic

As anindividual

Duopharma Biotech
BerhadMalaysia

Business

On behalf of anorganization,group orinstitution
As anindividual
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

41

I agree with the revisions given.

Eko Sukoharsono

Indonesia

Academic

42(1) Focus on impact and explanation of material topic evaluation is
welcomed.

ELEVATE

Hong kong

No response

43(3) 2425-2428: Again, it should be stressed that the due diligenceprocess can itself be a source of negative impacts and direct harm to
stakeholders by drawing marginalized people and groups and Human
Rights Defenders into conflict with powerful interests.
(2) 2394 - Box 1. Engaging with at-risk or marginalized people or
Human Rights Defenders could put them at risk of violent reprisals by
powerful local actors or elites with a vested interest in a given project
going forward. This should be mentioned somehow to ensure that a "dono harm" approach is taken.
(2) We have some concerns on the revised materiality process.
First of all, it seems that the proposed process would not be aligned with

Enact Sustainable
Strategies

SwedenConsultant

Enact Sustainable
Strategies

SwedenConsultant

Eni SpA

Italy

Business

44

45

On behalf of anorganization,

Page 12 of 48

46

47

48

49

the "double materiality" definition envisaged by the European Directive
on Non Financial Reporting.Secondly, such complex process would not
create value either for expert sustainability reporting companies as they
already have a solid materiality process in place, or for new reporters towhich the proposed process could be too complicated to put in place.
(3) Thirdly, if GRI's aim is to ensure comparability and process
standardization we still believe that such an aim will be not achieved, as
there are still too many subjective aspects, such as the threshold whichis to be set by every company. Moreover, in order to increase the non
financial performances comparability, we believe it would be more
effective to focus on the outcome of the materiality process rather thanthe process itself. With this regard, we appreciate the development ofSector Standards, in which the list of likely material topics are alreadyprovided. As such we believe that the listed themes, included in the
Sector Standard could be the starting point for all the reporters, allowing
them to review the list, and only eventually adding or eliminating topics
due to company unique specific peculiarities. These additions could bemade through already existing processes such as risk management
process or/and external stakeholder consultations.
To ensure comparability and simplify the reporting process, we believethat some disclosures must become compulsory for the companies inthe same sector, instead the others should remain voluntary at thecompanies’ discretion.
(3) Line 2593 – Relevance – We ask GRI to clarify the selection ofgroups it deems experts for the purpose of testing the material topics.

We believe that taking a different approach to negative human rights
impacts from all other impacts is inconsistent. Also, to focus on thepotential severity of an impact and give less precedence to thelikelihood could risk including irrelevant information in reporting.
(1) For the definition of material topic, we generally agree with thedirection, as it is less subjective, but we ask that GRI explain thefollowing components about how companies should determine "impact":
Do companies need to use lifecycle or other formal impact
assessments?

group orinstitution

Eni SpA

Italy

Business

On behalf of anorganization,group orinstitution

ERM

UnitedStatesConsultant

ERM

UnitedStatesConsultant

ERM

UnitedStatesConsultant

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Page 13 of 48

50(1) Lines 2582-2588 – Clarity – We ask GRI to clarify or explain instronger detail the relationship between “topic” and “impact”.

ERM

UnitedStatesConsultant

51(2) Lines 2589-2593 – Clarity – GRI should clarify the difference
between prioritization of material topics based on impact (largely the
focus of the revised standards) and prioritizing the material topics forreporting purposes. The latter seems to be the only place where
potential report information users are taken into account, since influenceon stakeholder decision making is no longer a factor in determining
material topics.
(4) [Box 3 of GRI Universal standards exposure draft and above] Moreclarity on how GRI expects the mapping between impacts and topics
would be beneficial.

ERM

UnitedStatesConsultant

ERM Certification
and Verification
Services (ERM CVS)

Netherlands

Assurance
providerERM CVS has included some comments on materiality and definitionsin Section 2 Key Concepts but, overall, this is a great improvement in
the guidance and steps, as well as the link to engagement of
stakeholder and the prioritization process. The revision focuses on
impact-based reporting which we support. It also avoids the tick box
approach of identifying material topics starting with the list of GRI
Standards.
(9) 2569 – we support the inclusion of clause that difficulty in measuring
an impact is not a valid reason for not reporting.

ERM Certification
and Verification
Services (ERM CVS)

Netherlands

Assurance
providerEuropeanAccounting
Association's
Stakeholder
Reporting Committee
EuropeanAccounting
Association's
Stakeholder
Reporting Committee
EuropeanAccounting
Association's
Stakeholder
Reporting Committee

CanadaAcademic

On behalf of anorganization,group orinstitution

CanadaAcademic

On behalf of anorganization,group orinstitution

CanadaAcademic

On behalf of anorganization,group orinstitution

52

53

54

55

(3) While we do see some efforts for assessing context in this section, it
remains broad and general. When discussing the impacts (2491 andbeyond), there is no more reference to context.

56(8) 2500 – we support the new clarity on assessing significance ofnegative impacts

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Page 14 of 48

57

58

59

60

(6) we understand and appreciate the focus on reporting negative
impacts (support the link with due diligence guidance) but it does restrict‘material impacts’ to doing less bad, which does not allow forbusinesses seeking transformative change, positive remediation in orderto protect / ensure their future. This is a potential problematic restriction
to reducing negative impacts and may inadvertently legitimate theabsence of more transformative / adaptive business behaviour. Thereneeds to find a way for businesses to report any such positive actions(7) 2485 – we support the improved clarity on guidance on offsetting
impacts, but feel there is need for more comprehensive framework forevaluating offset – e.g. with reference to SDGs
(5) 2381-2490 – we support the restrictions to recognising ‘positive’
impacts, but we feel the guidance in this is underspecified. These could
be more explicit with reference to evaluation criteria (e.g. link to UN
Sustainable Development Goals) and could link with specific geographic
priorities reported on in country SDG report (link with SDG deficits).
(4) 2353 – 2379 – we support the introduction of clearer geographic
granularity and extension of impacts beyond legal boundaries to include
actions / transactions/ relationships.

61(4) Moreover, I suggest to provide more guidance and some examples
about the threshold to separate material and not material impacts.

62(18) • Paragraph 1 of Step 4 (2562-2567):- (2594) Approval of material topics – when it comes to company
operations, investments or supply chains that may impacts on
indigenous peoples and communities, the company should ask therights holders if the material topics or “salient issues” identified areapproved from their point of view (have any been missed?) Such
verification and consultation should be a fundamental part ofindependent verification and oversight of the decisions made by thecompany.

EuropeanAccounting
Association's
Stakeholder
Reporting Committee

CanadaAcademic

On behalf of anorganization,group orinstitution

EuropeanAccounting
Association's
Stakeholder
Reporting Committee
EuropeanAccounting
Association's
Stakeholder
Reporting Committee
EuropeanAccounting
Association's
Stakeholder
Reporting Committee
EY S.p.A.

CanadaAcademic

On behalf of anorganization,group orinstitution

CanadaAcademic

On behalf of anorganization,group orinstitution

CanadaAcademic

On behalf of anorganization,group orinstitution

Italy

Consultant

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Page 15 of 48

63(16) • Paragraph 1 of Step 4 (2562-2567):

64- The approach of using cut-off points or thresholds when it comes tohuman rights is problematic for several reasons. FPP therefore
recommends that this section is redrafted.
(14) • Paragraph 1 of Step 4 (2562-2567):

65- GRI makes the following statement in line 2562: “The significance ofan impact is assessed relative to the other impacts the organization has
identified.” It would be useful to understand where this has originatedfrom? FPP does not consider that this approach could have beeninterpreted or derived from the UNGPs and would like to understand thethought process behind this proposed formulation.
(17) • Paragraph 1 of Step 4 (2562-2567):

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution- There is a need to clarify the “testing” paragraph and concept (2589):
is this being put forwards as a credible approach for independent
verification of information?
66

67

68

(12) • (2543-2545): a slight change in wording suggested here: "For
example, interfering with, damaging, or destroying a sacred space
without consultation or agreement with the people who use the space
can have a severe impact on people’s cultural rights." change to " Forexample, interfering with, damaging, or destroying sacred spaces withincustomary lands and territories - whether formally titled or not - canhave severe impact on people’s cultural rights."(11) • (2512) "non-compliance with the laws and regulations or with theinternational standards and agreements with which the organization is
expected to comply." - the difference between these can be large. It istherefore recommended that the results of an applicable law
assessment be provided and discussed with indigenous peoples so thatagreements can be made between the parties establishing which
standards the company is expected to follow (as per AFi).
(7) • Saliency (lines 2380- 2490): The very concept of “scale” that makes
up the definition of “severity” (along with Remediability and Scope) is not
an absolute concept. For one person what is deemed as most salient
will be different to another who is looking at the same picture or situationfrom a different vantage point.

Page 16 of 48

69

70

71

72

(10) • (2506) Severity: under the "scope" aspect of severity, we would
argue that the rights-holders themselves or their freely chosen
representatives need to feed in how grave they feel the impact to be tothem. Indeed, this point is made in relation to (2626) - that severity is not
an absolute concept. Again, the scale and significance of an existing or
past impact, or a potential future impact, may be determined differently
depending on the group or person(s) assessing what the material
impact is and its severity.
(13) • (2546 - 2558) A note should be made to say that positive impacts
are deemed as such when rights-holders determine that they are
positive impacts, not just when a company considers that benefits arebeing delivered. For instance, a benefit-sharing scheme with indigenous
peoples is set up during the FPIC process - this can be viewed as apositive impact by the company and reported as such. However, thecommunity dynamics may change over time due to increased wealth ina small fraction of the community and it may cause negative social
impacts and even conflicts. There is thus a need to check in with thecommunity through independent assessors to check that they feel thatthey believe positive impacts are occurring from their point of view.
(9) • Prioritisation (2491 – 2599): it therefore follows from the two above
points made, that prioritisation should not be left in the hands of thereporting company alone. The notion that that the commercialorganisation alone can decide the significance of an impact relative toother types of impacts it has identified (and then rank, prioritise and act
on these alone) is contrary to the spirit and intent of the UNGPs andtheir emphasis on stakeholder (rights-holder) inclusion and impacts on
people. Furthermore, where company operations, investments andsupply chains may affect indigenous peoples’ rights, this methodology
would not be adequate in respecting free, prior and informed consent(FPIC), which safeguards indigenous peoples’ self-determination andrights to land and resources.
(8) • lines (2485 - 2490) This is a useful element - please add to line
2485: "...positive contribution to sustainable development or
environmental initiatives such as reforestation" and line 2489 - replace"historical and cultural lands" with "customary lands and territories"; line
249 add word remedied: "needs to be addressed, remedied and cannot
be offset".

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Page 17 of 48

73

74

75

76

(6) Ø Rethought is required around the idea that where the organisationis unable to “identify actual and potential negative impacts across all its
activities and business relationships, for example, because it has
diverse or multiple global operations or because its value chain
comprises a large number of entities.” that "scoping" (2436 - 2442)
alone is a credible way to prioritise. Due to high-level nature of scoping
itself, and the various forms this could take, it is necessary that scoping
alone should not be viewed as enough to determine identification ofpotential and actual impacts, contrary to sentence 2442, which outlinesthat "The organization can then identify and assess specific actual andpotential negative impacts for these areas". External parties and the useof independent information sources and evidence should be drawn uponand feed-in to this determination.
(4) Ø Under "Assessing context" (2363 - 2379): there should be an
additional bullet that states that they should be assessing otherstakeholders who are affected by their activities and those of suppliers'(e.g. via a stakeholder mapping process to identify which indigenous
communities, local communities and smallholders are affected)(15) • Paragraph 1 of Step 4 (2562-2567):- (2567) There is this risk when things are grouped in the way
suggested, particularly when a human rights related issue gets
"grouped" under an environmental one. Each topic specific standard
would need to ensure it contained the relevant human rights aspects inthis case.
(5) Ø Box 1 (2394): Engaging with relevant stakeholders and experts:
add reference to Indigenous peoples considerations as per othercomments made in this feedback

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution77(3) Ø Under the bullets (2316 - 2322) insert a bullet that says: consult
with stakeholders, rights-holders and independent experts to inform
what material impacts it is involved with (this must be underscored)

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

78(2) Ø Clarification needed (line 2302) "This section describes the steps
that the organization should go through in order to identify its material
topics; following these steps is not a requirement."

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

Page 18 of 48

79(1) GRI 103 (lines 2206 – 2890)

Forest Peoples
Programme

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Hong Kong
University of Scienceand Technology
Hui XuHong Kong

No response

No response

China

As an
individual

ICR Systems &Management SRL

Bolivia

Nongovernmentorganization
No response

IndustriALL Global
Union

Switzerland

Labor
representative

On behalf of anorganization,group orinstitution

Section 2: Identifying material topics:80• In the guidance a note needs to be added to highlight that although thecompany may identify its material topics to report on, it must also
consider and take seriously any material impacts identified byrightsholders themselves, as well as by CSOs, NGOs and localorganisations with information on human rights, tenure andenvironmental matters. In short, a material topic should not only bedeemed as such by a company alone – it is not acceptable that acompany is the sole decision-maker in identifying potential and actual
impacts. Where a company does not feel it is contributing to a particularmaterial topic, yet it is a material impact well-known by otherstakeholders, a company should be required to report on why they do
not believe this impact is related to their business and supply chains.
Useful overview.
DELETE: In the case of potential negative human rights impacts, theseverity of the impact takes precedence over its likelihood.

81

Agreed82

It is very usefull to identify content within impacts, but this section does
not clarify how to identify the material topics with integration of GRI 101
and Principles for defining the report content.
(1) The text around identifying material topics is broadly supported
From a Labor perspective, lines 2347-2351 on workers who are not
employees, lines 2370-2375 on compliance with international humanrights standards including workplace human rights, lines 2394-2420(Box 1) on engaging with stakeholders and respecting their rights, andlines 2500-2545 on assessing the significance of negative impacts areespecially valuable.

83

No response

Page 19 of 48

84(3) We also offer the following comments for consideration:• Line 152: “In the case of potential negative human rights impacts, theseverity of the impact takes precedence over its likelihood.” We suggest
this should also apply to negative health and safety impacts.

Institution of
Occupational Safety
and Health (IOSH)

UnitedKingdom

Charteredbody for OSH
Professionals

On behalf of anorganization,group orinstitution

85

IOSH welcomes the proposed involvement of professional adviser /experts in assessing the significance of impacts and testing material
topics.

Institution of
Occupational Safety
and Health (IOSH)

UnitedKingdom

Charteredbody for OSH
Professionals

86(1) This section is now more materiality and impact focused instead ofreport content and topic boundary focused, which aligns more closelywith how material matters are identified in practice.

International Council
on Mining andMetals (ICMM)

UnitedKingdom

Trade orindustry
association

87(1) The ITUC broadly supports the text around identifying material
topics. From a Labor perspective, lines 2347-2351 on workers who are
not employees, lines 2370-2375 on compliance with international humanrights standards including workplace human rights, lines 2394-2420(Box 1) on engaging with stakeholders and respecting their rights, andlines 2500-2545 on assessing the significance of negative impacts areespecially valuable. With respect to the definition of “material topic”, ourview is that genuine assessment of “impacts” will always identify
employment and workforce issues as a material topic. Which includes
employment in the organisation’s value chain as well as within theorganisation.
On materiality. I suggest a certain percentage of outward benefit.

International Trade
Union Confederation

Belgium

Labor
representative

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Justina CallanganPhilippines

Business(1) It is great to see increased emphasis put on the identification ofmaterial topics. Current reporting tends to lack information on thedecision-making processes leading to the identification of the report’s
content.
(2) In order the increase reporting transparency, it would be useful tobetter connect the material topic identification exercise with the reporting
guidelines, particularly the verifiability requirement. There could beclearer expectations set out. For example, how should firms document
the decision-making processes related to the identification andevaluation of material topics? A greater emphasis on documenting

Laurence Vigneau

UnitedKingdomAcademic

Laurence Vigneau

UnitedKingdomAcademic

88
89

90

As an
individual
As anindividual

As anindividual

Page 20 of 48

91

92

93
94

95

96

97

processes rather than just reporting on the outcomes would help
increase transparency.
(4) It would be great if there was a link to additional resources like casestudies on how an organisation applied the 4 steps and showed that it
actually was a valuable exercise…
(5) Line 2488 - positive impacts… I'm not sure it's fully explained in thatexample a positive impact would be job creation/ community
development(3) Line 2392/3: Needs more explanation for why the co. must focus on
negatives…
(2) Line 2391: I understand what is meant by on an ongoing process but
is there a minimum. For example, a company might assess what they
have but not fully engage in an full assessment often and 5 years down
the line they haven't changed much…
(1) Agreed with the revised suggestions.

(10) (2574) “While some topics can cover both negative and positive
impacts, the organization may prioritize negative impacts separatelyfrom positive impacts, as negative impacts need to be discussed
independently and cannot be offset by positive
impacts.” Discussing them together does not automatically mean
offsetting them. It could just be contextual, e.g. negative and positives
around climate change.
(7a) Step 2: Identify Actual and potential Impacts
Look into these re materiality: (2422) “The guidance in this section on
identifying negative impacts is based on the UN Guiding Principles on2423 Business and Human Rights, the OECD Guidelines forMultinational Enterprises, and the OECD Due Diligence Guidance for
Responsible Business Conduct.” This is Basically an (statistical)
expectancy value: likelihood x potential outcome. Positive aspects areunderexplained and the link to strategy missing

Liberty Holdings
LimitedSouth Africa

No response

No response

Liberty Holdings
LimitedSouth Africa

No response

No response

Liberty Holdings
LimitedLiberty Holdings
LimitedSouth Africa

No response

No response

South Africa

No response

No response

MSC Mediterranean
Shipping Company
S.A.

Switzerland

Business

Network for
Sustainable
Financial Markets
CIC

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Network for
Sustainable
Financial Markets
CIC

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Page 21 of 48

98(6) Step 2: Identify Actual and potential Impacts
Positive vs. negative: (2392) “In situations where an organization has
limited resources available for identifying its impacts, it should start byidentifying its negative impacts, before moving onto identifying positive
impacts.” This is a decision which is not explained. One could also use a
different approach to limit the scope, e.g. by turnover, region, etc.

Network for
Sustainable
Financial Markets
CIC

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

99(7b) Step 2: Identify Actual and potential Impacts
Look into these re materiality: (2422) “The guidance in this section on
identifying negative impacts is based on the UN Guiding Principles on2423 Business and Human Rights, the OECD Guidelines forMultinational Enterprises, and the OECD Due Diligence Guidance for
Responsible Business Conduct.” This is Basically an (statistical)
expectancy value: likelihood x potential outcome. Positive aspects areunderexplained and the link to strategy missing(3) Step 1 seems very vague. It could be unrealistically time consuming
if taken seriously and at the same time green washing if sticking to theletter of the guidelines.

Network for
Sustainable
Financial Markets
CIC

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Network for
Sustainable
Financial Markets
CIC
Network for
Sustainable
Financial Markets
CIC
Network for
Sustainable
Financial Markets
CIC
Network for
Sustainable
Financial Markets
CIC
Network for
Sustainable
Financial Markets
CIC

UnitedKingdom

Nongovernmentorganization

UnitedKingdom

Nongovernmentorganization

UnitedKingdom

Nongovernmentorganization

UnitedKingdom

Nongovernmentorganization

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

100

101

102

(2) Step 1: Assess the organisation’s context
Assess the organisation’s context: (2327 – 2329) Mix between internaland external context, i.e. ‘business activities’ seem to be core rather
than context.
(4) Step 1: Assess the organisation’s context
Generally straight forward, but again a strong negative human rights
violation angle, not a business strategic lens on materiality.

103(5) Step 1: Assess the organisation’s context
Good to include ‘business relationships’, i.e. it can include supply chain
as well as customers.

104(1) (2609) ‘Report HOW it has identified its material topics,
including: HOW it has identified actual and potential, negative andpositive impacts on the EEP, including impacts on human rights, acrossown business activities and business relationships.’
Here the positive and negative aspect both feature.

Page 22 of 48

‘HOW it prioritized impacts for reporting based on their significance’

105

106

It is not clear if this can be avoided, but in this statement alone we havean aggregation of judgements: (1) what is material, (2) what issignificant, (3) what is prioritized to be reported on. The morejudgements, the more ambiguity. Due to this the aforementioned
guidelines, which do not have to be followed, are very important.
Otherwise comparability between companies does not exists – ifeveryone has slightly different judgements at each decision point.
Reporting how these judgements are made is an important first step, butwill stakeholders, including investors, have the time to read through allof this in order to be able to understand what the reports mean? Even if
we assume this, companies can still not be compared to each other.
(1) Materiality and Materiality Decisions
Identifying the material topics through the suggested steps is exactly
that: a suggestion but not a requirement (2302). Why is that?
(assumption: different legal frameworks in different countries).
Identification process is non-binding, but no comply or explain rule in thecurrent suggested revisions. (2310)(2) Add after line #2351:• The number of GRI Certified Sustainability Professionals undertaking
work on GRI Standards sustainability reporting for the organization.

Network for
Sustainable
Financial Markets
CIC

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Next Level
Sustainability

Australia

GRI Certified
Training
Partner inAustralia

On behalf of anorganization,group orinstitution

Add into Box 1 line #2394+ GRI Certified Training Partners ie "Engaging
with relevant stakeholders and Experts including GRI Certified Training
Partners" and insert in line #2419 "consulting GRI Certified Training
Partners, credible independent experts etc..."NOTE that Experts should reference GRI Certified Training Partners
who not mentioned anywhere in the Universal Standards but who
provide critical training and support services in report design,
implementation etc. )Line #2589 is about “Testing the material topics with information users
and experts”.
• The GRI Certified Training Partners (CTPs) as well as GRI Certified
Sustainability Professionals (CTPs) will have a higher degree ofexpertise in this testing than others in the current list of experts andshould be. Revise lines #2592 & 2593 as follows:

Page 23 of 48

107

108

109

o Examples of experts the organization can consult include GRI
Certified Training Partners (CTPs), GRI Certified Sustainability
Professionals (CSPs), non-governmental organizations, academics,
consultants, lawyers, and investors.
"The significance of a negative impact is assessed based on its severity(scale, scope, and irremediable character) and likelihood. In the case of
potential negative human rights impacts, the severity of the impact takes
precedence over its likelihood." This is the case for climate change as
well. We recommend GRI to add climate change into the guidance here.
Line 138/139/140 are of concern because the organisation is now
deciding on the significant impacts. This approach is different to ISO
and their approach to engagement with stakeholders so it will make it
hard for users to use GRI and ISO standards together.
(5) 2. We also believe that you should:- Provide additional guidance on how to determine the specific thresholdfrom which the topic generates a significant impact.

Paia Consulting

SingaporeConsultant

On behalf of anorganization,group orinstitution

Positive Impact
EventsUnitedKingdom

Nongovernmentorganization

PwC

UnitedKingdom

Assurance
providerOn behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

110(4a) 2. We also believe that you should:- Clarify the time horizon that should be taken into account for the
impact analysis to determine material topics (short-medium-long term)
and required disclosure of the actual time horizon considered.

PwC

UnitedKingdom

Assurance
provider111(2) How to identify a (significant) material topic remains quite complex
and open to interpretation (reference 149-154; 2300-2599). In thissense, the more "freedom" companies have, the worse is thecomparability of the information reported. Considering the increasing
call from stakeholders to create relevant and comparable non-financial
information, and the key role of defining materiality for the effective
adoption of the standards, we would suggest some amendments toenhance relevance, comparability and verifiability:

PwC

UnitedKingdom

Assurance
providerOn behalf of anorganization,group orinstitution-To provide more guidance on how stakeholder involvement is
considered when identifying the impacts. It is clear that stakeholder
feedback (based on a balanced identification of relevant stakeholders)
plays an important role when determining whether a topic is material.
However, it is not entirely clear how stakeholder perspectives should beconsidered in this new definition of materiality when identifying thePage 24 of 48

112

113

114

impacts. It would be advisable to establish specific and clear
phases/activities for stakeholder engagement.
(3) 2. We also believe that you should:- Provide additional guidance on how to take into account emerging
issues that may encompass relevant impacts. e.g. consider theguidelines of international organizations such as the OECD, etc.
(3) How to identify a (significant) material topic remains quite complex
and open to interpretation (reference 149-154; 2300-2599). In thissense, the more "freedom" companies have, the worse is thecomparability of the information reported. Considering the increasing
call from stakeholders to create relevant and comparable non-financial
information, and the key role of defining materiality for the effective
adoption of the standards, we would suggest some amendments toenhance relevance, comparability and verifiability:- To emphasise that companies need to develop robust models for
identification and evaluation of impacts and material topics that are well
documented and explained in the reports and set out in a way thatwould be amenable to providing necessary evidence to an assurance
provider.
(1) How to identify a (significant) material topic remains quite complex
and open to interpretation (reference 149-154; 2300-2599). In thissense, the more "freedom" companies have, the worse is thecomparability of the information reported. Considering the increasing
call from stakeholders to create relevant and comparable non-financial
information, and the key role of defining materiality for the effective
adoption of the standards, we would suggest some amendments toenhance relevance, comparability and verifiability:

PwC

UnitedKingdom

Assurance
providerPwC

UnitedKingdom

Assurance
providerPwC

UnitedKingdom

Assurance
providerOn behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

On behalf of anorganization,group orinstitution- To provide more specific guidance on the methodology to evaluate theimpact of material topics. This methodology may be flexible, andimplementation details may depend on the size and nature of thecompany, but further high level methodology guidance would beneeded to ensure similar interpretation by various preparers (where in asimilar fact pattern preparers should generally come to the sameconclusions on material topics) . This guidance is also important for andwill aid in the objective of GRI to represent ‘suitable criteria’ forPage 25 of 48

providing assurance on the non-financial information.
For example, we do not find it sufficiently clear how companies should
consider impacts to identify material topics where there are multiple
areas of impact, and there may be competing impacts with stakeholders
on different sides of the materiality equation (e.g. shutting down a plant
may have a positive effect on the environment, but a negative impact on
choice of employment or the local community). It is important tounderstand how such impacts should be weighed in determining theoverall ‘impact’. There may also be competing interests within a topic.
For example, Article 23 of the Universal Declaration of Human Rights
indicates that ‘everyone has the right to free choice of employment…’.
However, Article 25 indicates right to health and wellbeing is also a
fundamental human right. In considering impacts, it is unclear from theguidance how different impacts within a topic should be weighed. For
example, the proposed standard indicates that the most acute impacts
an organization can have on people are those that negatively affect their
human rights (reference 135-136). Accordingly, where there are both
positive and negative impacts, guidance is needed on how to evaluate
such situations. For example, it is unclear whether the evaluation ismade with respect to each article of human rights separately or on an
overall basis.

115
116

Additionally, more guidance should be provided on balancing thequantitative but also the qualitative nuances of the impacts andtherefore the materiality of the topics. For example, assume a company
has 10 plants where 9 are modern and efficient and the remaining plantis older, less environmentally friendly, and the biggest source ofpollution in the small town where it is located. From a purely quantitative
perspective the plant may not be very material considering it is only 1 of
10 plants. However, from the perspective of the town’s residents, itwould be considered the most material plant to them.
I agree with the proposals made here
Even if the "influence on the assessments and decisions ofstakeholders" can no longer be considered a standalone factor that
determines whether a topic is material, the identification of relevant

R&A Strategic
Communications
REPSOLSouth Africa

No response

No response

Spain

PrivateCompany

On behalf of anorganization,

Page 26 of 48

117

118

119

120

121

stakeholders should still be a step of the process to efectively inform themateriality assessment: this would help to determine the significance of
the impacts(4) How would thresholds be determined? Or if samples may beprovided. This is key as this is the sole criterion whether a topic ismaterial or not. Granted the threshold can be determined by theorganization (exposure draft line 2562 – 2573).
(2) There should be further clarity or guidance on assessing thesignificance of impacts – severity and likelihood. This is especially sosince there are different expectation for assessing the significance ofnegative impact vs potential negative human rights impact vs positive
impact (exposure draft line 2500 - 2558). In risk management for
instance, these are outlined clearly for avoidance of doubt or to ensure
some form of consistency.
(3) For negative human rights impacts (exposure draft line 2537 –
2539), severity takes precedence over likelihood. Human rights is very
wide – from right to live to freedom of speech. This section ischallenging to conduct.
(1) • On “Causing, contributing or being directly linked to negative
impacts” - further clarity, explanation or samples should be included aspart of the Sector Standards for better clarity. In the case of financial
institutions, the distinction between caused, contributed to and directly
linked to may be have different interpretation especially for contributed
to and directly linked to (exposure draft line 2452 – 2476). For instance,
one way to interpret is that for the same activity - when there are nocontrols in place or lack thereof, the organization has contributed to thenegative impact. But when there are controls in place and there is stillnegative impact, then the organization is directly linked to the negative
impact.
(3) There should be further clarity or guidance on assessing thesignificance of impacts – severity and likelihood. This is especially sosince there are different expectation for assessment for negative impact
vs potential negative human rights impact vs positive impact (exposure
draft line 149 – 154). In risk management for instance, these are
outlined clearly for avoidance of doubt or to ensure some form ofconsistency.

group orinstitution
RHB Bank Berhad

Malaysia

Business

RHB Bank Berhad

Malaysia

Business

RHB Bank Berhad

Malaysia

Business

RHB Bank Berhad

Malaysia

Business

RHB Bank Berhad

Malaysia

Business

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

On behalf of anorganization,group orinstitution

Page 27 of 48

122

to identify material topics, it is better referee to rules, regulations andexpectations too

RPMRG

Hungary

Consultant

123

I agree with the revisions

SAI Global Italia s.r.l.

Italy

No response

124

Happy with the detail provided and like figure 2 as it includes thepotential role of stakeholders and experts along the process, whichemphasises that an organisation cannot undertake the process orevaluate in isolation or only consider stakeholder issues at the start ofthe process.
(1) The reporter should also demonstrate they have undertaken theirassessment in accordance with GRI 103 and the organisation's
processes and have not just relied upon the sector standard (as perlines 271-274 in the universal exposure draft and 68-71 in the og
exposure draft). I think this guidance should be highlighted because
there might be a tendency to rely on the sector standard only (thereby
omitting organisation-specific material topics).
I find the revisions on materiality quite useful and agree with theproposed content.
There is an over-stress on the type of workers such as full-time, parttime. What GRI should focus is say the population and geographicalsize of the community, the demographics and the key ecosystemservice within the area. The categorization of employees other thangender or age may not be relevant.
On stakeholders. The extent of industrial activities' causality chain on
economic and the environment that ultimately impact people can bevery long. The current standards are putting the responsibility on thereporting organization to determine the materiality to the stakeholders.
There is a risk of understating of materiality of the outward impact tostakeholders. It would be good for GRI to create another set of standard
to help government, municipalities and local authorities to develop
criteria to measure materiality based on say political boundaries or river
basin for example. This is important for developing countries, especiallytropical and biodiversity-rich countries, that are facing a lot of issues
with sustainability, who would not have adequate expertise and would
be greatly inclined to follow standards if there is one.

SAICA

South Africa

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Shelley Anderson

Australia

Consultant

As anindividual

Simeon Cheng

Hong kongBusiness

Society of Certified
Risk Professionals

Malaysia

Nongovernmentorganization

As anindividual
On behalf of anorganization,group orinstitution

Society of Certified
Risk Professionals

Malaysia

Nongovernmentorganization

125

126
127

128

On behalf of anorganization,group orinstitution
No response

On behalf of anorganization,group orinstitution

Page 28 of 48

The aggregation of say effluent from a single factory that may fall within
regulatory limits could in totality be material to the community spreadalong a river basin, for example. Hence if would be good if GRI could
produce a standard that guides the government, who represents people,
the real and large-majority stakeholders of sustainability.
If an organization is left to decide what is material to the external
environment, which party can provide check and balance against that?
This is when statutory auditors can play a role by reviewing a statement
being disclosed by the reporting party. However, the auditor will alsoneed enough expertise or statistics to know what is material and if amaterial impact of a topic has been under-stated.
Therefore, it would be good if GRI could create a new standard or
include additional sections to guide regulators.

129

130
131

132

133

At its current status, the GRI may risk high level of green-washing byreporting organization.
It is difficult and challenging for companies to identify impacts, andespecially negative ones. It must be understood that this will be a
medium-term process to move to the identification of material topics as
ir is proposed in the new Standards. It involves many resources thatmany companies may not have at the moment.
The revisions make the identification of material topics clearer and more
succinct.
(3) I also think the links between material topics and impacts need to beclearer. The Impact Management Project has been doing work in thisarea (5 dimensions of impact) that may be a useful reference.
(1) This is a significant step change from previous GRI guidance on
identifying material topics. Whilst the changes are welcome and will
enable better reporting of impact, the change will create challenge andconfusion.
This was an area organizations needed assistance with so this provides
additional clarity around how to identify material topics

Sustenia

Argentina

Consultant

On behalf of anorganization,group orinstitution

Tang Lien

Malaysia

Consultant

Think Impact Pty Ltd

Australia

Consultant

Think Impact Pty Ltd

Australia

Consultant

Toronto Pearson
AirportCanadaBusiness

As anindividual
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Page 29 of 48

134(1) Line 2452 - Box2
description and examples of categories "cause, contribute, linked to" still
not absolutely clear. Maybe examples could be clarified.

triple innova

Germany

Consultant

135(2) e.g. Line 2459: we would see this as an example for "linked throughbusiness relationship", not "contribute" as it occurs with a supplier.
In which category would fall the following: a washing machine uses
water intensively, or a car has high emissions. This would be"contribute", as there is no business relationship?
(1) Hhow to determine scale of severity and likelihood of impact(s)?

triple innova

Germany

Consultant

Trisakti Sustainability
CenterIndonesia

Consultant

In the selection related to the identification of positive or negative
impacts I would include express references to the Sustainable
Development Objectives so that they are taken into account in theprocess and are linked to or reflected in the material aspects of theorganization.
(2) When explaining the identification of positive aspects, the concept ofcontribution is already introduced:

UN Global Compact
Network Spain

Spain

Nongovernmentorganization

UN Global Compact
Network Spain

Spain

Nongovernmentorganization

136

137

138

To identify its actual and potential positive impacts, the organization
should assess the manner in which it contributes or could contribute tosustainable development through its own activities, for example, throughits products, services, investments, procurement practices, as an
employer, or as a taxpayer.

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

On the other hand, when explaining the identification of material aspects
in the “Assessing context” section I would allude to initiatives such as
the United Nations Global Compact within the possible commitments
acquired by companies. Here you´ll find the text referred to:Assessing conext
The organization's responsibility in relation to the international standards
and agreements 2371 with which it is expected to comply; for example,
the International Bill of Human Rights; the 2372 International Labour
Organization (ILO), Tripartite Declaration of Principles concerning 2373

Page 30 of 48

139

Multinational Enterprises and Social Policy; the Organisation for
Economic Co-operation and 2374 Development (OECD), OECD
Guidelines for Multinational Enterprises; or the United Nations 2375
(UN), Guiding Principles on Business and Human Rights.
(1) We welcome the clarified requirement for organizations to consider
their actual and potential negative impacts and the scope to which that
requirement is applied

UNDP - SDG Impact
Team

UnitedStatesUN body

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
No response

140(2) although we suggest explicitly referring to the organization’s supply
chain. Such consideration (and subsequent action) by organizations isessential to achievement of the SDGs.

UNDP - SDG Impact
Team

UnitedStatesUN body141

This optional step-by-step Identifying material topics is reader/user
friendly. It provides clarity to guide the user to achieve what are
intended of this section and the overall reporting.

Malaysia

No response

142

2344 -2351 is not relevant in identifying whether a topic is material ornot, rather it may be transferred under 2352 (Assessing business
relationships) as "the relationship of the company with its employees
and workers".
(4) Suggestion to instruct reporting organizations to focus on negative
impacts first and positive impacts as a second priority.
(1) This change rectifies the bad habit of companies simply focusing onmaterial issues that affect external sources AND business sources(2) With respect to material items as a suggestion it would be good toanalyse all of the material risks for SME and Large Enterprise or MNE
and then only allow for companies to select from that list within theirreports - this could then help with analysis and comparison in the years
to come.
Finally. Now, no one can keep on misunderstanding materiality (let'shope). Please make sure, that GRI staff understands it as well. They
didn't always do so in the past years.
2323: rather than oversee: appoint somebody to oversee the process
and validate the choice of material topics.
(1) The diagram at line 2310 is clear and helpful.

Universiti Malaya
Sustainability &Living Labs
Secretariat(UMSLLS)
University of Asiaand the Pacific Center for Social
Responsibility
University of Denver

Philippines

Assurance
providerUnitedStatesUnitedStatesAustralia

No response

On behalf of anorganization,group orinstitution
No response

No response

No response

No response

No response

ValoraSwitzerland

No response

No response

Virginie Poulin

FranceNo response

World Benchmarking
Alliance

Netherlands

Benchmarking foundation

As anindividual
On behalf of anorganization,

143
144
145

146

147
148

University of Denver
University ofSouthern
Queensland

Page 31 of 48

149

150

151

152

153

(2) The Steps from line 2300 to 2558 are helpful because of theiralignment with the UN Guiding Principles on Business and Human
Rights and the OECD Due Diligence Guidance for Responsible
Business Conduct.
(4) Line 2366-2369 should explicitly include “human rights or “humanrights risks.”(2) For example, lines 2323-2324 say the highest governance bodyshould oversee the process and approve the identified material topics,
but this is not clarified in the governance disclosure requirements.
Addressing this discrepancy will be very useful.
(1) It would help report preparers immensely if there was a required
process, rather than a suggested one for identifying material topics.
There is often confusion on this point. For example, lines 2323-2324 say
the highest governance body should oversee the process and approve
the identified material topics, but this is not clarified in the governancedisclosure requirements. Addressing this discrepancy will be very
useful.
Line 2595 can underscore that it should be a requirement for companies
reporting in accordance with the GRI to explicitly confirm that thehighest governance body validated any results of the materiality
assessment.
(3) Also, assessing context (from line 2363) should explicitly mention
reviewing the organization’s existing risk register to draw connections to
the organization’s Enterprise Risk Management (ERM) function. This
could fit into lines 2429-2435 that specify how to identify actual andpotential negative impacts.
The “Assessing the significance of negative impacts” elements should
also align with enterprise risk management techniques, for example,
referencing COSO’s guidance on applying enterprise risk management
to ESG-related risks for a more diverse range of advanced techniques.

World Benchmarking
Alliance

Netherlands

Benchmarking foundation

World BusinessCouncil for
Sustainable
Development
World BusinessCouncil for
Sustainable
Development
World BusinessCouncil for
Sustainable
Development

Switzerland

Nongovernmentorganization

Switzerland

Nongovernmentorganization

Switzerland

Nongovernmentorganization

World BusinessCouncil for
Sustainable
Development

Switzerland

Nongovernmentorganizationgroup orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

On behalf of anorganization,group orinstitution

Page 32 of 48

154(1) Changing to severity vs. likelihood to determine materiality is anoversimplification. In addition, using probability as a determinant ofeffect is subject to short term thinking and bias. Other factors likevulnerability (IE ability to manage impacts and dependencies if theyoccur irrespective of probability) velocity of impact / speed of onset,
connectivity of issues should be considered. For example, COSO’s
definition of a material risk is “The possibility that events will occur andaffect the achievement of strategy and business objectives.”

World BusinessCouncil for
Sustainable
Development

Switzerland

13

3. Comments on Section 3. Reporting on material topics

14

Please refer to pages 90-97 in the Universal Standards exposure draft.

15

Table 3. Comments on Section 3. Reporting on material topics

No.

2

3

On behalf of anorganization,group orinstitution

Name oforganization orindividualCountry

Stakeholder
group

Submission
type(2) By a different perspective, the notion of topic boundaries could havestill helped the entity to understand the scope of its impacts. The lack ofthis concept should be compensated by a further stress and reliance on
stakeholders engagement activities especially during the first time
adoption of the standards.
(2) - 'An explanation of how the organization manages the topic' (103-2a) <- This should be kept"

Alessandro Mantini

Italy

Business

As an individual

Allied Environmental
Consultants

Hong kong

Consultant(1) "The new requirement: ""It now also requires reporting the indicators
used to evaluate progress, in addition to goals and targets (see MT-3-cii)"" <- Any examples of the indicators? Maybe diclosing the approaches
is better instead of reporting the indicators.

Allied Environmental
Consultants

Hong kong

Consultant

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Comment
1

Nongovernmentorganization

The other new requirements are good call for the reporting.

Page 33 of 48

4

Would GRI mention "This information can still be reported, andorganizations are encouraged to do so with respect to the material topics
that the external initiatives are relevant to"?

Allied Environmental
Consultants

Hong kong

Consultant

5

GRI 103-3

Allied Environmental
Consultants

Hong kong

Consultant

Choon Kiong Ting

Malaysia

Business

As an individualCity Developments
LimitedSingapore

Business

On behalf of anorganization,group orinstitution

Corporate
Citizenship

UnitedKingdom

No response

No response"Reasonable change but more guidance may be needed.

6

7

8

For reference:
103-2: management approach of each material topic, including policies,
commitments, goals and targets, resources, etc.
103-3: explanation of how the management approach of each material
topic is evaluated"would it be helpful if GRI were to include a request for organisation tostate their impacts in a table format based on its operational contact via
the ESG format, while stating whether the impact is r are positive andnegatve?
The organization should include information on how it integrates thefindings from its identification and assessment of impacts acrossrelevant internal functions and processes, including:- the internal decision-making, budget allocation, and oversightprocesses to enable effective actions to manage the impacts.
While this is a guidance only, asking disclosure on budget allocation
may be too much info to share.
Disclosure MT-3 Management of material topics and related impacts
This disclosure seems to focus solely on negative impacts. It is hard tounderstand why readers of reports would be uninterested in positive
impacts and how reporting organisations act to magnify them. The
Requirements should be amended to include positive and negative
impacts and how each is to be reported.

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Page 34 of 48

9

10

11

The DIHR is concerned that the Standards do not adequately reflect thatsome human rights issues are very context specific, whereas others are
wide-spread and that for a company’s due diligence to be effective andaligned with the UNGPs it needs to be implemented corporate wide inboth a horizontal and vertical understanding of that term, i.e. acrossfunctions and across regional and country level presences. Relatedly,
when reporting material topics in accordance with MT-2, the Standards
should support organisations in including topics that may be of context
specific nature, but still considered material as well as topics that may beof relevance throughout a company. For instance, it is useful tounderstand whether a material topic is considered a group-wide issue oris a concern only in select countries of operation or in connection withselect products or business segments. Secondly, we are not convincedthat the Standards adequately capture the degree to which a reportingorganisation is involved with or exposed to the impacts of a given
material topic. MT-2-b does not currently guarantee that reportingorganisations provide readers with insight into these dimensions,although the guidance for MT-2-b-ii addresses the issue in part.
To ensure these important contextual pieces of information aredisclosed, DIHR recommends adding a new requirement iii to MT-2-b.
Suggested text: ‘MT-2-b-iii describe how and to which extent theorganisation is exposed to the material topic’. Associated guidanceshould encourage reporting organisations to disclose whether thematerial topic is considered material across the organisation or is
included due to its relevance to certain geographies, products, activities
or similar AND to provide context on the magnitude of the company’s
exposure to the risk (e.g. insight into how big a share of the company’s
suppliers or company subsidiaries are estimated to be exposed to thematerial topic.
DIHR recommends changing the examples given for categories as thesethree categories would often overlap and not provide a mutually
exclusive structure. An alternative relevant categorisation example could
be by value chain e.g. material topics that relate to an organisation’s
upstream value chain, own activities or downstream value chain.
Actual negative impacts should be remediated, AND their reoccurrence
should be prevented. DIHR recommends adding a bullet to prompt

Danish Institute for
Human Rights

Denmark

National
human rights
institution

On behalf of anorganization,group orinstitution

Danish Institute for
Human Rights

Denmark

National
human rights
institution

On behalf of anorganization,group orinstitution

Danish Institute for
Human Rights

Denmark

National
human rights
institution

On behalf of anorganization,

Page 35 of 48

12

13

14

15

16

17

sharing of examples of how the organisation has taken action to preventthe reoccurrence of actual impacts in addition to their remediation.
Suggest specifying that indicators and other metrics used can be both
output-based and outcome-based. Outcome-based indicators are betterin demonstrating the change that companies’ due diligence is making.
For example, ‘endorsement of action plan in response to human rights
impact assessment’ (output indicator) vs ‘satisfaction level of local
communities’ (outcome indicator).
(1) Deloitte supports the GRI103 disclosure simplifications

Danish Institute for
Human Rights

Denmark

National
human rights
institution

Deloitte

United States

Consultant

While we recognize the intention of the GRI Standards is to focus on
outward impacts on society, the economy and the environment, we
believe that reporters increasingly wish to ensure their purpose andstrategies achieve positive impacts on the economy, environment andpeople, often aligned to the UN SDGs. We recommend that thestandards clarify that where these (outward) impacts have been adopted
as overall strategic targets, this should be disclosed, together withinformation on how this informs strategic developments and thebusiness model. Currently, the disclosures are described as activities
rather than the result of an overall strategic effort or business model.
Widening the scope in this way will help reporters to illustrate whereparticular impacts are adopted at the strategic level and overseen andmanaged accordingly.
(2) Deloitte [...] believes the removal of the term “boundary” will be wellreceived as we believe it has caused much confusion over the years.

Deloitte

United States

Consultant

Deloitte

United States

Consultant

We believe MT-1iii should be expanded to included evidence or wider
information, for example, we recommend drafting as follows:“the stakeholders, experts, evidence and sources of data that haveinformed the identification of material topics;”. This would encouragereporters to include their own internal reporting and data and otherexternal reports or data in such assessments.
Lines 541 – 543 (p. 21) Completeness (also cross-reference Lines 989
et seq a for Disclosure REP-2 of Organization’s entities included in its

Deloitte

United States

Consultant

Douglas Hileman

United States

Consultant

group orinstitution
On behalf of anorganization,group orinstitution

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

As an individual

Page 36 of 48

18

sustainability reporting, p. 40). The Universal Standards should statethat organizations should state the scope for completeness purposes,
and, where some facilities are excluded (including only for someparameters), the organization should state so at the appropriate
location(s) in the report, and provide the basis for this. The Universal
Standards and guidance state or imply that the non-financial reporting
should be complete. This is impractical in many cases, or at least forsome parameters. It may be feasible to report on some topics that are
centrally managed, and apply across the entire organization - such as
human resources policies. Some material topics may apply at larger
facilities, but not at others – such as water usage and wastewater
generation in a large organization with satellite offices or employees
working from home. “Materiality” can apply to some locations, andperhaps for some topics at those locations.
Identification of material topics and related impacts; Guidance to MT-I-aI and MT-I-a-ii. GRI should provide a mechanism for material topics tobe identified by the organization at the aggregated level, and that
additional material topics can be reported as appropriate for selectedorganizational units or high-profile topics with more limited financial andoperational footprint at the organization. The selection of material topics
is done at the aggregated level of an organization, consistent withconsolidated financial reporting. However, sustainability topics can bematerial at a dis-aggregated level from an environmental or people/
human rights perspective. A diversified global organization could haveone business unit that uses chocolate as a raw material, posting risk offorced labor or child labor in the supply chain. Another diversified
organization can have a small unit that uses electronics in a product,
posing risk of conflict minerals, use of banned or restricted substances,or products’ improper disposal. Although GRI emphasizes thatmateriality must consider topics through the eyes of others, the process
still favors aggregation, and eliminating many issues that pose
substantial risk.

Douglas Hileman

United States

Consultant

As an individual

Page 37 of 48

19

20

(3) Line 2546 et seq Assessing the significance of positive impacts. GRI
should require that positive impacts, when reported, should specify thetime frames of the positive impact. GRI should also require thatorganizations provide updates and (where practical) trends to show
comparable data (cross-reference Comparability at Lines 508 – 511),
and should suggest that organizations report measures being taken to
ensure that the positive impacts continue on an ongoing basis. Positive
impacts from sustainability efforts are the ultimate goal. Positive impacts
can be inherently problematic for reporting – and for their effectiveness –due to the conflict between ongoing impact (e.g., spanning multiple –and future – reporting periods) and reporting requirements for a single,
backward-looking reporting period. There are examples, such as anorganization reporting that they planted trees to offset greenhouse gas
emissions. There is no future investment in the care and monitoring
trees, and within a short period of time, they are lost to disease, neglect,development, or illegal logging. The organization has benefited fromCO2 offsets and/or reputational enhancement, but the reported
sustainability benefits have not been achieved.
Disclosure MT-3; Management of Material topics and related impacts;
Guidance to MT-3-b. “The internal decision-making, budget allocation,and oversight processes to enable effective actions to manage theimpacts.” GRI should insert the phrase “including internal auditing
sponsored by Management or Internal Audit as authorized by the HGB”
after the phrase “oversight processes”. Auditing is a commonly-used,and effective mechanism for oversight. Internal Audit (3LOD) is charged
with oversight of all risks – operational, compliance, reporting, andreputational – and is authorized by the HGB. The Internal Audit
profession is beginning to realize the importance of non-financial
reporting, but there is substantial room to grow. Other auditing
programs are sponsored by Management, and address topics relevant
to sustainability, including environmental, health and safety, IT, supply
chain and quality. Many of these auditing programs originated withcompliance risks, and have not yet evolved to consider risks such as
those posed by sustainability reporting and the underlying informationand data. Note that both 3LOD and 2LOD audit programs occur at/within the organization, and are different from external assurance. This
commenter has suggested explicit reference to auditing (including

Douglas Hileman

United States

Consultant

As an individual

Douglas Hileman

United States

Consultant

As an individual

Page 38 of 48

21

22

clarification of the difference between 3LOD and 2LOD audits)
elsewhere in the commentary.
Management of Material topics, Guidance to MT-3-c-i. This commenteris pleased that GRI has included “internal or external auditing” amongprocesses used to track effectiveness of actions taken. GRI should
revise the phrase to read “internal auditing (the Internal Audit activity as
authorized by the HGB and/or other internal audit activities for specificfocus areas, or external auditing”. GRI could add value to sustainability
stakeholders with a bit of clarification; this commenter’s experience isthat these terms confuse almost everyone. As noted elsewhere,“Internal Audit” (often capitalized) is an activity authorized by, andreporting to, the HGB. In the common “lines of defense” governancemodel, it is considered the third line of defense (3LOD). There are otherinternal audit programs authorized by management designed to mitigate
risk in high-risk areas, such as environmental, health and safety, supply
chain, etc. These 2LOD audit programs are considered “internal audit”
whether the audit activity is performed by organization’s employees or
outsourced, or a combination of the two. “External audits” are any audits
authorized and sponsored by an entity outside the organization. These
can include audits by insurance underwriters or customers. ISO
management systems certifications provide for “external audits” bycertain firms. It is a common misunderstanding among stakeholders that“external audits” result in output that is available to the public; theygenerally do not.
Lines 2730 et seq, Lines 2818 et seq, Lines 2851 et seq Disclosure MT3 Management of material topics and related impacts. GRI should add arequirement – perhaps as MT-3-f – that organizations shall report onwhether or how it uses Root Cause Analysis to investigate, understand,learn from, and make changes to their operations as a result ofsignificant incidents involving any sustainability topic, or where theorganizations have fallen significantly short of meeting sustainability
goals or objectives. GRI guidelines should include the concept of Root
Cause Analysis (RCA), and should require that organizations use thisprocess when there have been significant incidents, or where theorganizations have fallen significantly short of meeting sustainability
goals or objectives. George Santayana is credited with the quote “those
who do not learn from history are doomed to repeat it.” This applies to

Douglas Hileman

United States

Consultant

As an individual

Douglas Hileman

United States

Consultant

As an individual

Page 39 of 48

23

24

25

organizational performance and governance, as well as to the weighty
historical intent of Mr. Santayana. There are organizations thatinvestigate the causes of chemical explosions, major transportation
accidents, and crimes. It is also common for organizations to use the
RCA concept for failures in compliance, operations, or meeting financial
performance expectations. RCA is “topic-agnostic” and can be applied
to sustainability topics as well. The public may look to organizations for
widely-reported incidents, such as failures tied to aircraft design or auto
emissions control systems. Stakeholders should have insight into
whether and/or how the RCA process is adopted and applied formaterial sustainability topics, or reported failures with a nexus to any
sustainability reporting topic. This commenter believes that appropriate
requirements for RCA can be an effective deterrent to organizational
greenwashing or sustainability fraud. For example, an organization may
establish wildly unrealistic goals just because a competitor has, andcommit few or no resources to pursuing it. Stakeholders (notably theincreasingly impactful socially responsible investing community) could
incorporate these forward-looking goals into key decisions – with no realorganizational basis for them.
(5) In Identifying impact (2443-2451) the GRI listed a number of levels tocarry out the initial assessment, what is missing in the GRI Standards isthe consideration of facility-level data in the scoping of materiality topics,
particularly in industrial sectors. The lack of addressing this level in the
GRI Standards and the prominence of aggregates in the reports could
impact the principle of Clarity (489) and the contextualisation of the data
particularly for companies operating in different locations. This has adirect impact on materiality and material topics that vary acrossgeography and sector, and thus impact disclosures on performance.
(2) Focus on impact and explanation of material topic evaluation is
welcomed.
(1) (a) Line 2725 – Describing policies or commitments for the topic
seems duplicative of RBC-2, Policy Commitments

Dr Aljaohra Altuwaijri

Saudi Arabia

Academic

As an individual

ELEVATE

Hong kong

No response

ERM

United States

Consultant

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Page 40 of 48

26(2) (b) Line 2784 – Describing how the company applies the
precautionary principle seems duplicative of RBC-2a (specifically lines
1659-1664)

ERM

United States

Consultant

27(1) Policy commitments – Requirement a. overlaps with that of theindividual topic disclosures for the material topics identified by theorganization. Requesting this two-fold, though in a slightly different
context seems unnecessary. This could be specifically about humanrights only.
(7) MT-2 Material topics and related impacts• 103-1-b has been revised: It now requires reporting, for each material
topic, whether the organization is involved with the negative impacts
through its own activities or because of its business relationships (seeMT-2-b-ii). In addition, the term 'topic Boundary' is no longer used. ERM
CVS recommends retaining ‘Topic boundary’ as, based on our
experience, a material topic such as water stress can be very significant
but within a very specific (organisational) boundary and this may beneeded for stakeholder understanding. Alternatively, adding a note on
identification of where the impact occurs or is significant within theorganization's operations would add further transparency.
(5) Questions raised by the changes - for consideration:• Does the organization have to explain what significance means to theorganization based on scale, scope, severity and likelihood (e.g. $,number of countries, number of people)?
(10) • Regarding the list of impacts that organizations are to disclose:
Shall the organization specify which type of impact it is (e.g. negative,
positive, actual, potential, irreversible, intentional...)?

ERM Certification
and Verification
Services (ERM CVS)

Netherlands

Assurance
providerERM Certification
and Verification
Services (ERM CVS)

Netherlands

Assurance
providerOn behalf of anorganization,group orinstitution

ERM Certification
and Verification
Services (ERM CVS)

Netherlands

Assurance
providerERM Certification
and Verification
Services (ERM CVS)

Netherlands

Assurance
provider(11) • Reporting all impacts can be extremely cumbersome for certain
large organizations and for assurance purposes assessing thecompliance of this section can be tricky. A) Is there a minimum number
or significance threshold on impact disclosures that the company has toreport in order to be in accordance? B) If large organizations report only
the most significant/ relevant impacts (not all), will they still be inaccordance?

ERM Certification
and Verification
Services (ERM CVS)

Netherlands

Assurance
providerOn behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

28

29

30

31

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Page 41 of 48

32

33

34

35

36

(6) MT-2 Material topics and related impacts• "103-1-a has been revised: It now requires describing, for eachmaterial topic, the impacts identified (see MT-2-b-i), rather than an
explanation of why the topic is material." The order of MT-1 and MT-2
allows organizations to determine material topics in different ways,
starting by identification of impacts or by identification of material topics.
The list of impacts of material topics can be extremely long for largeorganizations but it seems GRI is requesting a comprehensive list of
impacts. ERM CVS would suggest organizations only having to note themost relevant or significant impacts identified by the organization overall
and for each material topic (based on the second step of the materiality
determination process).
(12) MT-3 Management of material topics and related impacts• Reporting on the effectiveness of the actions taken is very demandingfor organizations because the requirement appears to have no scope/
limit regarding disclosure. For example, if an organization discloses justone lesson learned regarding a program, is this deemed sufficient to bein accordance?
(8) MT-3 Management of material topics and related impacts• The requirements for reporting the effectiveness of the actions taken
could be a challenge to reporting organizations. An organization may nothave goals, targets AND indicators. We recommend this should be OR
to avoid GRI moving from its position of guiding reporting practices todetermining all the sustainability management practices. For example,
compliance with laws and business conduct may be material to acompany but they may not have a target or goal except to comply,
therefore an indicator such as compliance training, hotlines
denouncements etc. should be enough to understand performance.
Using OR in this requirement rather than AND is also relevant toassurance of alignment with GRI standards.
(9) MT-3 Management of material topics and related impacts• MT-3 update is clearer in terms of disclosure requirements than theprevious version.

ERM Certification
and Verification
Services (ERM CVS)

Netherlands

Assurance
providerOn behalf of anorganization,group orinstitution

ERM Certification
and Verification
Services (ERM CVS)

Netherlands

Assurance
providerOn behalf of anorganization,group orinstitution

ERM Certification
and Verification
Services (ERM CVS)

Netherlands

Assurance
providerOn behalf of anorganization,group orinstitution

ERM Certification
and Verification
Services (ERM CVS)

Netherlands

Assurance
providerI personally saw the value of the topic boundary concept and drew theattention of report users to its importance in the past. Understanding the
topic boundary application per company makes it easier to prorate to a

Eszter Vitorino

Netherlands

Investor

On behalf of anorganization,group orinstitution
As an individual

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full picture and make comparisons among industry peers. But i am surea lot of though went into this revision so i won’t contest it.
(3) Further clarity and guidance are required in order to determine
boundaries to an organisation’s responsibilities and the impacts it isaccountable for.

38(10) 2595 – we feel that there should be disclosure on any changes tomaterial impact priorities by highest governance bodies after testingthese priorities with external bodies (e.g. experts, academics, NGOs,
etc...).

39

Removal of the term topic boundary and revision of concept brings moreclarity on reporting impacts for a material topic, by dividing into actualand potential, positive and negative.

EuropeanAccounting
Association's
Stakeholder
Reporting Committee
EuropeanAccounting
Association's
Stakeholder
Reporting Committee
Fuji Xerox (HongKong) Limited

CanadaAcademic

On behalf of anorganization,group orinstitution

CanadaAcademic

On behalf of anorganization,group orinstitution

Hong kong

No response

No response

Fundación ONCE

Spain

Foundation

On behalf of anorganization,group orinstitution

Step 2 of identifying material topics (Clause 2380) helps organization to
identify impacts in a more comprehensive way than current GRI 103,
clarifying that organization should consider actual and potential negative
impacts it causes or contributes to through its own activities, as well as
those directly linked to its operations, products, or services by its
business relationships. This aligns with “Balance”, the reporting
principles (Clause 476).
40

The suggestion is to include in a new Guidance to MT with references tocomplementary documents and guidance who can help organizations
and companies to report about specific topics. In the case of disability,
we would suggest to include the Guide "Disability in Sustainability
Reporting", by GRI and Fundación ONCE, as a reference document.
'REFERENCES:
Universal Exposure draft: Line 2742
Suggestion coming from pages 36, 41, 44, 46 and 49 of the Guide"Disability in Sustainability Reporting" by GRI and Fundación ONCE
(Please consider Fundación ONCE's contribution provided by email tosupport this response).

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41

In this section you order to report materiality and associate it with risks.
You only talk about current and future risks. What about analyzing
crucial and huge impacts that occurred in the past? I mean, for example,
a severe impact occurred in a company, that caused really bad impacts,
somehow the company managed to overcome it, but did they really
understand what happened? What can they learn about it? Maybe
reporting something like this could help companies start digging into thepast and find answers for theey actual or future problems.
(2) The new requirements will reduce the reporting burden, i.e.
organizations only need to report topic changes from the previous period
instead of previous periods in the topic boundaries. These changes aresupported.
It is recommended that, as guidance, the effectiveness of actions taken
also be presented from stakeholders’ perspective since organizations
could be biased about their own effectiveness.

Ilunka, Estrategia
Sustentable

MexicoConsultant

On behalf of anorganization,group orinstitution

International Council
on Mining and Metals(ICMM)

UnitedKingdom

Trade orindustry
association

International Council
on Mining and Metals(ICMM)

UnitedKingdom

Trade orindustry
association

44

Line 358,removal of topic boundary needs to be carefully studied again
as it is the essential concept for organizations' value chain.

Japan

No response

45(2) However, it should be clarified if the decision-making processes used
to identify material topics/sustainable development topics can bedisclosed in a “methodology note”. Specificities reported and/or omitted,
especially in relation to compliance or non-compliance with relevantinternational standards, human rights impacts assessments and related
preventive approaches and/or mitigation procedures, could be better
clarified while describing relevant examples ofinvestments/projects/programmes implemented in a specificgeographical location.
(11) Note: MT-1, MT-2 and MT-3 include a large amount of disclosure
regarding the process, which is good.

International
Development Centerof Japan
MSC Mediterranean
Shipping Company
S.A.

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution
No response

Switzerland

Business

On behalf of anorganization,group orinstitution

Network for
Sustainable Financial
Markets CIC

UnitedKingdom

Nongovernmentorganization

Network for
Sustainable Financial
Markets CIC

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

42

43

46

47

(5) ‘2644) The examples all have a human rights context. Whilst without
a doubt important it would be useful to show examples with a variety ofdifferent contexts in the guidelines.

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48

49

(2) ‘The stakeholders and experts whose views have informed theidentification of material topics’
This seems to be a good idea, however whether or not it is meaningfuldepends solely on the decision making process, especially as the GRO
guidelines stretch that the decision has to made by the board.
(3) ‘(2616) report changes in the material topics compared to theprevious reporting period.’

Network for
Sustainable Financial
Markets CIC

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Network for
Sustainable Financial
Markets CIC

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Network for
Sustainable Financial
Markets CIC

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Network for
Sustainable Financial
Markets CIC

UnitedKingdom

Nongovernmentorganization

Network for
Sustainable Financial
Markets CIC

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

Greater disclosure about changes in the material topics is required. It
should be clear that changes occurring within the reporting period must
be reported. Further, an organisation cannot report everything andtherefore the organisation should disclose how it has determined whatchanges to include. One way the organisation can illustrate the changes
made and how they were decided by providing a case study.

50

51

52

(2654) Good and important point.
(8) Step 4 Prioritize the most significant impacts for reporting:(2563) “The significance of an impact is assessed relative to the otherimpacts the organization has identified. The organization should arrange
the identified impacts from most to least significant, and define a cut-off
point or threshold to determine which of the impacts it will focus its
reporting on. The organization should document the threshold andcriteria used when identifying material topics. To facilitate prioritization,
the organization should group the identified impacts into topics (see Box3).” This sounds good, so the next step should be that companies report
this, at least in form of a case study.
(2) (27674) One framework for grouping could be the SDGs.

(1) (2660 – 2665) This structure of course makes sense; however, it isessential to remember all the limitations and decision points raised
above. One suggestion would be to include a footnote linking back tothose sections, i.e. stating that materiality, significance and priority toreport are all decisions taken by the company and only what survives
these filters will be seen here.

Page 45 of 48

53(1) Disclosure MT-3 Management of material topics and related impacts:(2722) There is no reference to the positive dimension.

Network for
Sustainable Financial
Markets CIC

UnitedKingdom

Nongovernmentorganization

On behalf of anorganization,group orinstitution

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

The same is true as for MT-2: A footnote linking and explaining thelimitations would be crucial to avoid the impression of completeness.
54(3) (2837) This should / could be case studies that we have talked about
during the call.

Network for
Sustainable Financial
Markets CIC

UnitedKingdom

Nongovernmentorganization

55(2) Disclosure MT-3 Management of material topics and related impacts:(2724) Overall these points make sense, but the aforementioned
completeness is key. If you can get away with cherry picking one issue
and one project that you did well on, then there is not much point inreporting to start with: impression management. This reiterates the pointthat problems with the definitions get worse when aggregated to the laststage, i.e. the actual reporting.

Network for
Sustainable Financial
Markets CIC

UnitedKingdom

Nongovernmentorganization

PwC

UnitedKingdom

Assurance
providerRHB Bank Berhad

Malaysia

Business

56

57

Much of this is risk management 101 and very similar to the ICAEW (orany professional) approach to risk. If the impacts are seen as risks then it
would be better to suggest a specific risk model that companies can use
to report on the impacts, especially as companies should be familiar withthose concepts.
(4b) 2. We also believe that you should:- Clarify the time horizon that should be taken into account for the impact
analysis to determine material topics (short-medium-long term) andrequired disclosure of the actual time horizon considered.
he focus is "in particular" (i) and (ii) - both of which are on negative
impacts. By virtue, should state that it is "in particular" but not limited to
the negative impacts. This would give reassurance to users that theyshould also share on positive impacts created also.

On behalf of anorganization,group orinstitution
On behalf of anorganization,group orinstitution

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58

Guidance to MT-3-b. The IIA recommends editing this sentence as:“The internal decision-making, budget allocation, and oversightprocesses, including internal audit as authorized by the HGB, to enableeffective actions to manage the impacts.”
An effective mechanism for oversight, internal auditing is charged withoversight of all risks – operational, compliance, reporting, andreputational – and is authorized by the Highest Governing Body (HGB).
Note that internal audit programs occur within the organization, and are
different from external assurance. Explicit reference to internal auditing
would be beneficial to the quality and reliability of sustainability data.

The Institute ofInternal Auditors

United States

Standard
setterOn behalf of anorganization,group orinstitution

59

Management of Material topics, Guidance to MT-3-c-i. The IIA ispleased that GRI has included “internal or external auditing” amongprocesses used to track effectiveness of actions taken. However, GRI
could be more useful/applicable to sustainability stakeholders with a bitof clarification, as these terms can be confusing. The IIA suggests GRI
revise the phrase to read “internal auditing (the internal audit activity as
authorized by the HGB), or external auditing”.

The Institute ofInternal Auditors

United States

Standard
setterOn behalf of anorganization,group orinstitution

University of DenverUnited States

No response

No response“Internal auditing” is an independent, objective assurance and consulting
activity designed to add value and improve an organization’s operations.
It helps an organization accomplish its objectives by bringing asystematic, disciplined approach to evaluate and improve theeffectiveness of risk management, control, and governance processes.
“External auditing” is any audit authorized and sponsored by an entity
outside the organization. These can include audits by insurance
underwriters or customers. ISO management systems certifications
provide for “external audits” by certain firms. It is a common
misunderstanding among stakeholders that “external audits” result in
output that is available to the public; they generally are not.
60

(3) The depth of information that the MT-3 (Management of Material
Topics and Related Impact) disclosure requires is essential as an
expansion of the former 103 Standard. It requires organizations to be
descriptive and prescriptive and likely holds the strongest argument foraccountability in reporting overall.

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62

63

With respect to Material Topics - Section MT-1 or MT-2 - it would be
beneficial to highlight what orgnisations unimitigated risk impacts are
and then restate those risk impacts with an assumption that controls tomanage risk are reasonably effective.
Actual and potential impacts can be reported. However, actual impacts
should be further interrogated to highlight what the unmitigated impact ofthat actual impact could be as well as the mitigated impact. For example
in management of material topic - 2725 - 2729 - actions taken toprevent or mitigate potential negative impacts could be administrative innature - for example "Company XYZ has a Sustainability Policy thatoutlines that every person has a right to refuse unsafe work" - simply
having a policy does not actually reduce any risk to workers as it is100% administrative in nature and relies upon a worker to speak up.
Would suggest highlighting each action taken whether it is anadministrative control, engineering control etc. - Hierarchy of controls
applied to each described action.
(5) It could also be useful to encourage indication of which stakeholder
groups have been involved and engaged in the process, and how.

University ofSouthern
Queensland

Australia

No response

No response

University ofSouthern
Queensland

Australia

No response

No response

World BusinessCouncil for
Sustainable
Development

Switzerland

Nongovernmentorganization

On behalf of anorganization,group orinstitution

Page 48 of 48