Our client, a multilateral development bank with a strong social mandate, wanted to get ahead of regulatory requirements in sustainability reporting. Although not subject to CSRD obligations, this forward-thinking institution chose to voluntarily adopt double materiality analysis to strengthen its transparency and best practices.

CHALLENGEs 

3 strategic issues  

1. Institutional Adaptation: Accounting for the unique realities of a multilateral development bank throughout the double materiality exercise. 
2. Multi-Framework Compliance : Developing an analysis compliant with both the CSRD directive and ISSB IFRS S1/S2 standards, ensuring a harmonized approach. 
3. Building on Existing Assets : Leveraging and updating data from the first materiality exercise conducted in 2019, optimizing the initial investment..  

PROPOSED SOLUTION

In order to do so, Ksapa went through the following steps:  

Step 1: Strategic Business Model Mapping 

• In-depth business model analysis of development finance operations
• Value chain clarification through comprehensive documentary review
• Personalized exchanges with internal managers and department heads
• Mapping of loan portfolios, grant mechanisms, and technical assistance programs

 Step 2: Financing-Specific Material Issues Identification

• Inventory of sustainability issues aligned with ESRS for banking operations
• Prioritization according to client’s development finance activities
• Mapping of impacts, risks and opportunities (IROs) specific to banking sector
• Focus on infrastructure, financial inclusion, and climate adaptation projects

 Step 3: CSRD-Compliant Assessment and Banking Integration

• Collaborative workshops with internal teams across departments
• Personalized interviews with key decision-makers and external partners
• Co-construction of issues and associated IROs for banking contexts
• Validation sessions with risk management, operations, and sustainability teams

 Step 4: Assessment and Consolidation 

• Application of double materiality CSRD banking thresholds
• Consolidation of results in clear, actionable matrices for banking operations
• Final validation with senior banking leadership and stakeholders
• Integration with existing banking risk management frameworks

RESULTS & IMPACT

 Deliverables 

Comprehensive Methodological Guide

• Detailed adoption framework for internal teams
• Step-by-step implementation guidance and CSRD compliance checklists
• Financing-specific considerations and best practices

Customized Assessment Questionnaire

• Diagnostic tool tailored for operations and distributed among employees
• Cross-departmental materiality insights gathering instrument
• Framework for ongoing materiality assessment updates

Dynamic Double Materiality Matrix

• Strategic analysis tool for ongoing ESG management and reporting
• Clear visualization of material issues specific to development finance
• Foundation for stakeholder communication and decision-making

Strategic Transformation Outcomes

Enhanced ESG Vision Clarity

• Structured understanding of ESG impacts and risks linked to social development mandate
• Improved targeting of sustainability strategies in banking operations
• Clear connection between materiality and banking business model

Improved Transparency and Accountability

• Enhanced reporting capabilities for diverse stakeholder groups
• Strengthened communication with donor governments and partner organizations
• Better alignment with beneficiary community expectations

Proactive Regulatory Positioning

• Preparation for future double materiality CSRD-related regulatory developments
• Industry leadership demonstration in sustainable banking practices
• Competitive advantage in regulatory compliance readiness

Optimized Stakeholder Dialogue

• Clear foundation for engaging stakeholders on sustainability priorities
• Improved dialogue effectiveness and strategic alignment
• Enhanced credibility in sustainability communications

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