Setting industry-wide priorities through custom materiality analysis
Selected for materiality expertise
FrameworkESG developed one of the first robust materiality analysis methodologies in 2005, and our work since then has established us a one of the leading experts in that work. We’ve conducted dozens of such analyses on behalf of clients, including many custom-designed ones, such as one evaluating the distinct issues facing the diverse business units of one of the world’s leading media and entertainment corporations.
Due in part to that reputation, in early 2015, an industry organization representing more than 150 members, including some of the largest CPG companies in the world, approached FrameworkESG to develop a specialized form of materiality analysis for the entire industry. The organization sought to position itself and its members as leaders in responsible manufacturing, recognizing that its partners and customers were becoming increasingly selective in choosing products and vendors.
A unique challenge
While materiality analysis is fairly common these days for individual companies, the methodology we designed made our client one of the first organizations to execute a materiality analysis at the industry level.
Given the diverse range of manufacturers, materials providers, and consumer-facing brands comprising the organization’s membership, we developed an approach based on mapping the industry’s full value chain and identifying the most critical ESG issues at each stage. This also allowed us to isolate ESG data specific to different types of companies for discrete analysis and recommendations.
A better informed industry
Our analysis incorporated extensive interviews, surveys, and document reviews across value chain stages to determine the risks and opportunities facing industry members. It also took into account the views of external stakeholders such as consumers, investors, NGOs, and ratings and ranking organizations.
Our findings have helped to drive further engagement and meaningful new efforts to increase sustainability of the industry. The results of the analysis and our subsequent work with the organization have informed extensive efforts across the industry, including:
- Strategic planning
- Metrics selection
- Impact reduction initiatives and quantified goals
- Member engagement
- Resource prioritization
- Sustainability reporting.
The results and detailed data were also made available to member companies to inform their own strategic planning and materiality analyses.
Our analysis identified key ESG issues at each stage of the industry value chain, which we ultimately consolidated in an industry-level materiality matrix.