Stakeholder engagement and sustainability reporting

In a global context of growing social and environmental concerns and evolving views on responsible consumption, large companies are increasingly expected to report not only on financial performance, but also on social and environmental outcomes. In deciding what to report on, enterprises are encouraged to select from a wide set of triple bottom line variables. Sustainability reporting guidelines suggest that this selection should be guided by the principle of materiality, according to which material aspects either reflect an organization’s significant economic, environmental, and social impacts or substantively influence the assessments and decisions of stakeholders. We highlight the centrality of stakeholder engagement in the materiality assessment process because analyzing the interests of stakeholders can, in fact, help define the various financial, social, and environmental concerns organizations must account for nowadays.