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 multilateral bank chose to voluntarily adopt double materiality analysis to strengthen its transparency and best practices. This work enabled the Bank to strengthen its credibility on ESG, enhance transparency and accountability within internal teams, and establish a solid foundation for more meaningful stakeholder dialogue.

CLIENT CHALLENGES

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
3. Building on Existing Assets : Leveraging and updating data from the first materiality exercise conducted in 2019.

OUR APPROCH

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
• 1:1 interviews 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
• Mapping of impacts, risks and opportunities (IROs) specific to banking sector and prioritization according to the client’s development finance activities – 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
• Validation sessions with risk management, operations, and sustainability teams

 Step 4: Assessment and Consolidation 

• Application of double materiality CSRD thresholds for a multilateral bank
• 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 

1. Comprehensive Methodological Guide

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

2. Customized Assessment Questionnaire

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

3. Dynamic Double Materiality Matrix

• Strategic analysis tool for ongoing ESG management and reporting
• Clear visualization of material issues specific to development finance

Business Benefits

Enhanced ESG Vision Clarity

• Structured understanding of ESG impacts and risks linked to social development mandate
• 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 and 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
• Enhanced credibility in sustainability communications

TAKE ACTION: READY TO TRANSFORM YOUR ESG STRATEGY?