Why double materiality is your secret weapon for more impact

By reframing the topics, La Marzocco was able to improve the strategic interpretation of the assessment results and better compare them to its existing business strategy and company culture. More importantly, the upgraded categorization of sustainability topics inevitably gives the issues greater weight and priority leading to more robust preparation for action planning.

Materiality is an ongoing topic that requires constant attention

As businesses develop, their materiality issues change. While broad topics such as climate change may not show obvious changes, practical sustainability concerns can shift, requiring updates to implementation plans, materiality assessments, strategies, and reporting.

If ignored, companies are more likely to become targets for greenwashing allegations since outdated materiality assessments no longer reflect the company’s true sustainability risks. Typical drivers of significant changes include mergers and acquisitions, substantial changes in business strategy, or emerging issues such as water resilience and biodiversity.

In the first half of 2023, Royal DSM N.V. a purpose-led, science-based company specializing in health and nutrition, merged with Firmenich S.A., the world’s largest privately-owned fragrance and flavor company. At the time, both companies had an excellent reputation in sustainability and led their industries in ESG benchmark performance.

Even though both DSM and Firmenich were equipped with recent materiality assessments (no older than 12 months), they decided to conduct a new double materiality assessment for all four DSM-Firmenich divisions individually and combine them into one new corporate version. The assessment process not only created a new corporate materiality matrix but also helped align the sustainability roadmaps and organizations.

Similarly, La Marzocco encountered its fair share of sustainability dynamics. At the end of 2023, De’Longhi SpA became the major shareholder of La Marzocco and announced the formation of a global hub in the professional coffee machine market to drive synergies. The hub included not only La Marzocco but also Eversys, a Swiss manufacturer of premium professional espresso machines also owned by De’Longhi SpA. This change impacted the group’s sustainability roadmap and led to new questions such as, “How would the material issues at Eversys differ from those at La Marzocco?” and “How to deal with ESG reporting requirements from the De’Longhi Group?”

Aside from a major event like the new ownership and group structure, La Marzocco’s sustainability team tries to stay up to date with its materiality results by capturing the impact of smaller events and even micro-trends. It developed a simple card sorting tool to track market perceptions and prioritize sustainability topics. Each card contains a potentially material issue, and stakeholders are requested to sort the cards in order of relevance. Later stakeholders are interviewed about why they made certain choices. This low-tech tool is used at events and meetings to spark discussion with internal and external stakeholders like coffee roasters, farmers, and corporate clients. This allows the sustainability team to continuously collect and monitor feedback from a diverse group of stakeholders.