If you are looking for a list of the Top 6 Tips for your Double Materiality Assessment within the Advertising and Marketing sectors, download our insightful analysis attached.
Double Materiality highlights the dual impact of a company’s activities on the environment and society, as well as how these impact a company’s economic performance. This is very significant in the media industry, due to the constant flux and evolving changes in technology, consumer behavior and market dynamics in the sector. Within marketing and advertising, this adaptation often requires a flexible or shorter-term business strategy, traditionally seen as contrasting to the longer-term objectives necessary in sustainability strategy. Thus, a major challenge media companies face is balancing financial and ESG factors. As a growing and recognized concept in sustainability reporting, double materiality and its assessment are critical in capturing real and potential impacts present in business’s operational ecosystem, and understanding how these can further drive business strategy.
Material topics within the media sector often revolve around responsible business practices, ethical advertising, and environmental footprint reduction, because of their direct consumer impact and heavily service-based operations. For these reasons many material topics fall under the social category. Unique topics arise pertaining to the advertising and marketing sector including ethical advertising, diversity and inclusion, and sustainable messaging. Ethical advertising refers to the way that products and services are promoted, used and sourced, as this can significantly impact consumer behavior and societal values. Diversity and Inclusion is relevant in a holistic approach, not only within the organization’s workforce, but also within the content created and shared, as embracing diversity in campaigns fosters greater social fairness and equity. Building on this, sustainable messaging with respect to greenwashing is a principal topic, due to the increased consumer value of sustainable and ethical practices. For this reason, strategic stakeholder engagement cannot only provide valuable insights for improving sustainable and responsible advertising, but also build trust through accurate and verifiable green messaging.
Within the environmental division of ESG, material topics that became of high importance for top media and advertising organizations included sustainable production, and measurement and reporting. Due to the production of advertising materials having very resource-intensive processes, it generates a substantial carbon footprint. Therefore, sustainable production practices become key in minimizing the environmental impact of content creation and tracking improvements toward ESG goals. Finally, within governance consumer privacy becomes principal in media materiality. With the rise in our digital advertising and data-driven market, it is key that advertisers collect and use data responsibly and follow privacy regulations.
As identifying material topics are the first stage of an organization's materiality assessment, the following steps are to understand them and to go beyond non-financial reporting by implementing best practices that address these material topics as part of the overall business strategy. This step may have a major impact on your materiality assessment, as practices and implementation are evaluated during the materiality reporting process. Two examples within the media industry highlight this link with overall business strategy implementation:
• Dentsu Group, a Japanese advertising and public relations company has recently transitioned to a global management structure, establishing a Sustainability Committee directly under their Group Management Board. This directly addresses ESG governance, as the committee comprises twelve diverse members, meeting quarterly to monitor progress against their goals to promote sustainability strategy from various perspectives. Additionally, since 2022, Dentsu Group has included ESG performance indicators in their executive compensation structure, which relate directly to measurement and employee engagement. Dentsu utilized a Value Creation Model to visualize their material topics for their long-term strategy.
• Havas Group, also a global advertising and communications conglomerate, is consistently ranked as one of the best suppliers in advertising and market research by EcoVadis for their implementation of purchasing a charter for Global Strategic Suppliers (2022 CSR Report). This supports their efforts in ethical advertising and supply chain management for socially responsible purchasing policies within media production. However, despite Havas 2022 CSR report listing ‘impact areas’ (i.e., climate, people, clients and communication) it lacks a clear Double Materiality Matrix visualizing the company’s most material issues. Download on the top of the page our full list of the 6 Tips for Implementing Double Materiality in Media that we have collected through our industry analysis.
In the ever-evolving landscape of the advertising and marketing sector, embracing double materiality assessment has become imperative. As measured within Edelman trust barometer, the media sector is losing trust from the public. Therefore, a strong ESG balance can help to regain brand loyalty and trust. Having stakeholder engagement as the forefront of decision-making and setting clear ESG goals not only aligns businesses with societal values but also enhances the organization's long-term sustainability. The integration of ESG values into advertising and marketing strategies not only accelerates ESG performance, but also resonates with the growing socially conscious consumer segments. However, achieving success in this area relies on various sustainability commitments, pertaining to material topics like diversity and inclusion, supply chain management, consumer privacy, and strategy implementation methods like organizational governance structures and stakeholder engagement, all pivotal in capturing the greatest effectiveness of double materiality practices.
If you would like to know more about double materiality assessments or require assistance with your materiality assessment and ESG strategy development, get in touch with Johana at Johana@finchandbeak.com or call +31 6 28 02 18 80 to discuss how Finch & Beak can support you.