Double materiality is a core principle of the European Union's sustainability reporting standards (ESRS). The ISSB and TSRS, by contrast, are based on investor-focused financial materiality. Companies connected to the EU market may need to follow both approaches.
Related terms
MaterialityA misstatement being large enough, individually or together with others, to influence the economic decisions of users of the financial statements.Turkish Sustainability Reporting Standards (TSRS)The standards issued by the POA on the basis of the ISSB standards for companies' reporting of sustainability-related financial information.Carbon Border Adjustment Mechanism (CBAM)An EU regulation that puts a price on the embedded carbon emissions in the production of certain goods imported into the European Union.Carbon footprintThe total greenhouse gas emissions caused by an organisation, product or activity, expressed in carbon dioxide equivalent (tCO₂e).Climate-related risksThe potential effects on a company's financial position of physical risks arising from climate change and transition risks arising from the shift to a low-carbon economy.ESGShort for environmental, social and governance factors, used to assess companies' sustainability performance.
Last updated: October 22, 2026 · This definition is for general information only.