LExtra-financial accounting, the purpose of which is to measure the interdependence links that exist between a company and its ecosystem, and to encourage the evolution of companies towards more sustainable operating methods, is an immense climatic and social issue. Indeed, diverting even 1% of global financial capitalization each year thanks to new accounting standards would finance the 4,000 billion euros necessary for a just transition on a planetary scale.
For this market shift to take place, we still need to be able to count everything that matters. To do this, a global response is being developed within the International Sustainability Standards Board (ISSB), under the aegis of the Foundation IFRS (the international accounting standards body), endorsed by international financial market regulatory authorities.
What matters in business accounting is what is material: information whose omission could influence the decision to buy or sell shares of a company, or to lend it capital or not.
In this area, Europe has made an ambitious normative choice, by requiring that materiality extends beyond the economic domain: in addition to its financial backers, for the company it is a question of counting everything that matters to all its stakeholders. To define this approach, a term was chosen: “double materiality” – “Corporate Sustainability Reporting Directive” (CSRD), or directive on the publication of extra-financial information for large companies.
A triple illusion
Obvious at first glance, this conception is in reality simplistic. Having become the rallying cry of those who wholesale reject the ordinary materiality of financial markets, now deemed “simple”, it maintains a triple illusion and carries a dangerous blind spot.
The first illusion is that the performative power of materiality would in itself be transposable outside the economy. Seductive, but tricky. The materiality of information on the markets is sanctioned by an immediate, clear and strong decision: buy or sell. However, the non-economic aspect of a double materiality does not motivate any immediate, clear or strong sanction. A major subject for one actor will in fact be secondary for another.
For example, the pollution of a river will cause very different concerns depending on whether it is the municipality which will bear the cost of the clean-up, the local fishing association which will deplore the disappearance of its favorite species, or an NGO which will, on the contrary, only count protected species.
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