Domain C · Area C-CA2 · Materiality assessment and controlled professional judgement

C.5Determine impact materiality

Working Draft version 1.1

Purpose and scope

This unit covers the capability to identify, assess, prioritise and document actual and potential positive and negative impacts on people, the environment and, where relevant under the reporting basis, the economy. It includes impacts arising through the organisation's activities, products, services and business relationships, the use of severity and likelihood criteria, qualitative evidence, affected-stakeholder and specialist inputs, prioritisation and governance approval.

Applied competency statement

Can identify, assess, prioritise and document actual and potential impacts using the impact-materiality criteria required by the reporting basis, including severity, likelihood where relevant, qualitative evidence and accountable professional judgement.

Boundary and escalation

This unit determines impact materiality under the applicable reporting basis and does not make legal findings, scientific causation determinations, human-rights investigation conclusions or management decisions on remediation. Qualified subject-matter, human-rights, scientific, legal and local expertise may be required, and management and governance bodies retain responsibility for the conclusion.

Key quality risks

Assessing topics rather than specific impacts; using likelihood to reduce an actual impact; averaging away a severe dimension; treating stakeholder popularity as materiality; omitting value-chain or affected-group impacts; netting positive and negative impacts; confusing management effort or policy coverage with impact significance; relying on incomplete qualitative evidence; or applying arbitrary thresholds that exclude severe human-rights or irreversible environmental impacts.

Required knowledge · 6

C.5-K01

Understands actual and potential, positive and negative, direct and indirect impacts arising through activities, products, services and business relationships and the need to assess impacts rather than broad topic labels alone.

Knowledge Type: Impact identification · Normative Weight: Core

C.5-K02

Understands severity dimensions such as scale, scope and irremediable character and why a severe dimension may require qualitative judgement rather than mechanical averaging.

Knowledge Type: Severity · Normative Weight: Core

C.5-K03

Understands the role of likelihood for potential impacts and the need not to apply likelihood as a discount to impacts that have already occurred.

Knowledge Type: Likelihood · Normative Weight: Core

C.5-K04

Understands that positive impacts require evidence of actual or potential effects and reporting-basis-specific criteria and should not be inferred merely from policies, intentions or expenditure.

Knowledge Type: Positive impacts · Normative Weight: Core

C.5-K05

Understands affected-stakeholder, due-diligence, grievance, incident, scientific, sector and other evidence; prioritisation; uncertainty; thresholds; qualitative overrides and governance approval.

Knowledge Type: Evidence and prioritisation · Normative Weight: Core

C.5-K06

Understands common impact-materiality biases, value-chain and vulnerable-group issues, legal and specialist boundaries and the relationship to topic determination, disclosure and remediation.

Knowledge Type: Reporting and specialist boundary · Normative Weight: Core

Applied skills · 5

C.5-S01

Develop an impact inventory from business-model, value-chain, stakeholder, due-diligence, incident, external and specialist evidence.

Skill Type: Core applied capability · Observable Output or Result: Impact inventory

C.5-S02

Apply severity, likelihood where relevant and other reporting-basis criteria consistently, using qualitative evidence and disaggregation where numeric scoring is insufficient.

Skill Type: Criteria application · Observable Output or Result: Impact-materiality assessment

C.5-S03

Compare impacts without inappropriate netting or averaging, identify severe or high-uncertainty cases and apply documented qualitative judgement and escalation.

Skill Type: Prioritisation and judgement · Observable Output or Result: Severity, likelihood and evidence rationale

C.5-S04

Aggregate or relate material impacts to reportable topics without losing distinct affected groups, locations, value-chain stages or impact characteristics.

Skill Type: Topic and reporting translation · Observable Output or Result: Material impact and topic decision record

C.5-S05

Facilitate specialist and management challenge, document dissent and uncertainty and obtain appropriate governance approval and update triggers.

Skill Type: Review and governance · Observable Output or Result: Approved impact-materiality conclusion

Professional behaviours · 3

C.5-B01

Prioritises evidence about effects on people and the environment rather than the organisation's reputational preference or ease of data collection.

Behaviour Type: Affected-party orientation · Non-compensable Requirement: No

C.5-B02

Does not cancel negative impacts with positive activities or average away a severe or potentially irremediable impact.

Behaviour Type: Non-netting and severity discipline · Non-compensable Requirement: No

C.5-B03

Documents uncertainty, evidence limitations, thresholds, qualitative overrides and specialist dependence and escalates contested high-severity cases.

Behaviour Type: Transparency of judgement · Non-compensable Requirement: No

Typical tasks · 4

C.5-T01

Compile and validate actual and potential impacts across own operations and business relationships using the approved scope and evidence plan.

Primary Output Link: C.5-O01

C.5-T02

Assess negative and positive impacts using the applicable severity, likelihood and other criteria and record evidence, uncertainty and specialist input.

Primary Output Link: C.5-O01

C.5-T03

Prioritise impacts, test thresholds and qualitative overrides, investigate borderline and severe cases and document the rationale.

Primary Output Link: C.5-O02

C.5-T04

Translate material impacts into topic and disclosure implications, obtain governance approval and define reassessment triggers.

Primary Output Link: C.5-O03

Expected outputs · 3

C.5-O01

Impact inventory and impact-materiality assessment

Output Type: Professional work product

C.5-O02

Severity, likelihood and evidence rationale

Output Type: Professional work product

C.5-O03

Material impact and topic decision record

Output Type: Professional work product

Proficiency indicators

Level 1 · Foundation

C.5-L1-01

Can use an established methodology to document defined impacts, apply specified criteria and prepare a supported preliminary impact assessment.

Indicator Dimension: Task execution

C.5-L1-02

Can distinguish actual from potential impacts, identify obvious severity, evidence or value-chain gaps and escalate severe, uncertain or specialist-dependent cases.

Indicator Dimension: Quality, judgement and accountability

Level 2 · Practitioner

C.5-L2-01

Can independently operate a moderately complex impact-materiality assessment across multiple topics, locations, affected groups and business relationships.

Indicator Dimension: Task execution

C.5-L2-02

Can apply severity and likelihood consistently, use qualitative judgement, resolve routine scoring and aggregation issues and explain conclusions and limitations to management.

Indicator Dimension: Quality, judgement and accountability

Level 3 · Advanced Practitioner

C.5-L3-01

Can design or critically review impact-materiality methodologies for complex, multi-country, value-chain-intensive or high-severity contexts.

Indicator Dimension: Method design and review

C.5-L3-02

Can challenge arbitrary thresholds, inappropriate averaging or netting, resolve contested severe impacts and advise governance bodies on evidence, uncertainty, specialist dependence and approval.

Indicator Dimension: Leadership and governance

Illustrative evidence · 6

C.5-E01

Impact inventory and impact-materiality assessment with activity, relationship, affected group, location, status and evidence fields.

Evidence Type: Work product

C.5-E02

Severity, likelihood and evidence rationale showing scale, scope, irremediability, uncertainty and qualitative judgement.

Evidence Type: Work product

C.5-E03

Material impact and topic decision record with threshold, override, dissent and approval information.

Evidence Type: Work product

C.5-E04

Source, due-diligence, engagement, incident, specialist and calculation trail supporting the assessment.

Evidence Type: Process evidence

C.5-E05

Documented affected-stakeholder, human-rights, scientific, legal, management or governance review and the practitioner's response.

Evidence Type: Review evidence

C.5-E06

Observed defence of a borderline or severe impact conclusion in a case or governance setting.

Evidence Type: Observed performance

Assessment · 3

C.5-A-L1

Knowledge examination, impact-classification exercise and limited assessment task

Impact specificity; actual-versus-potential distinction; correct use of severity and likelihood; evidence linkage; recognition of severe or specialist cases.

C.5-A-L2

Integrated impact-materiality case and written memorandum

Completeness of impact universe; criteria consistency; qualitative judgement; non-netting; treatment of affected groups, uncertainty and borderline cases.

C.5-A-L3

Complex high-severity case, portfolio and oral defence

Method design; severity discipline; threshold and override governance; specialist integration; challenge and governance-level oral defence.

Relationships · 15

From	To	Type	Rationale
A.1	C.5	Strong linkage	Impact-focused user and decision contexts inform but do not replace impact-materiality assessment.
B.1	C.5	Feeds into	Context and system relationships inform impact-materiality assessment but do not determine severity or the final conclusion.
B.3	C.5	Feeds into	Identified impacts and their characteristics become inputs to impact-materiality assessment.
B.4	C.5	Feeds into	Climate effects on people and the environment may inform impact-materiality assessment.
B.5	C.5	Feeds into	Location-specific environmental effects and dependencies inform impact-materiality assessment.
B.6	C.5	Feeds into	Social impacts and evidence become inputs to impact-materiality assessment and require appropriate severity analysis.
C.3	C.5	Feeds into	Impact-materiality assessment must operate within an explicit organisational and value-chain scope while remaining alert to missing impacts.
C.4	C.5	Feeds into	Stakeholder, due-diligence and other evidence is a key input to impact-materiality assessment.
C.5	B.3	Prerequisite	Impact identification and classification should be conceptually clear before materiality criteria are applied.
C.5	C.4	Evidence and traceability linkage	The assessment depends on proportionate affected-stakeholder, due-diligence, incident and specialist evidence.
C.5	C.8	Method, data and analytical linkage	Scoring, thresholds and qualitative overrides support but do not replace impact-materiality judgement.
C.5	C.9	Feeds into	Impact conclusions, rationale and approval must be retained in the controlled materiality file.
C.5	G.3	Disclosure, claims and publication linkage	Material impacts should connect to governance, strategy, business model, actions and risk information where relevant.
C.7	C.5	Prerequisite	A combined process must retain the separate impact-materiality conclusion and evidence.
C.8	C.5	Method, data and analytical linkage	Impact criteria, severity and likelihood may be operationalised through controlled scoring and qualitative judgement.

Role profiles for this unit

Role	Target level	Relevance	Evidence expectation
Corporate Sustainability Reporting Practitioner	Practitioner	Required?	A case or work sample demonstrating independent performance, documented judgement and a reviewable professional output.
Sustainability Reporting Manager or Lead	Advanced Practitioner	Role-defining?	A complex case or verified portfolio, supplemented by oral or observed defence, demonstrating method design, challenge and governance capability.
Sustainability Reporting Adviser or Consultant	Advanced Practitioner	Role-defining?	A complex case or verified portfolio, supplemented by oral or observed defence, demonstrating method design, challenge and governance capability.
Sustainability Data, Systems and Controls Specialist	Foundation	Supporting?	A supervised or defined work sample showing correct application, traceability and recognition of escalation needs.
Assurance Readiness and Reporting Quality Specialist	Advanced Practitioner	Role-defining?	A complex case or verified portfolio, supplemented by oral or observed defence, demonstrating method design, challenge and governance capability.
Investor, Capital Markets and Ratings Disclosure Specialist	Practitioner	Required?	A case or work sample demonstrating independent performance, documented judgement and a reviewable professional output.