Financial materiality

A sustainability issue is financially material if it could affect the company’s cash flows, performance or value.

It is the lens used by ISSB standards. ESRS use it too, alongside impact materiality.

Find providers and guides

• ISSB (IFRS S1/S2) providers
• Double materiality assessment tools

Related terms

• Double materiality
• Impact materiality

Guides

• ESRS vs ISSB vs GRI: what’s the difference?

← All ESG terms

Reviewed 14 October 2026. General information, not legal advice.