Single vs Double Materiality Assessment for ESG Reporting in the GCC
With Environment, Social and Governance (ESG) reporting now mandatory in much of the GCC Countries, such as in Oman via the Muscat Stock Exchange (MSX), the real question for regional companies is no longer whether to do a materiality assessment — but which one: single or double?
The materiality assessment acts like a compass to guide how the ESG reporting process will be conducted, by identifying what ESG and financial aspects are relevant to each company and its stakeholders for disclosure in the report.
For example, an oil and gas company may find climate transition risk, emissions management, and community relations rise to the top, while a tourism business might find biodiversity, cultural heritage, and workforce wellbeing as their focus.
As discussed in our first sustainability reporting article, each ESG report is tailored to the company in question, and the materiality assessment is at the first step of that tailoring process - making sure reports are meaningful to investors, rather than a generic check-box exercise.
Case Study: MSX and single materiality
The MSX requires companies to conduct a single materiality assessment identifying issues that are significant either to the company’s financial performance or to stakeholders.
Typically, this involves:
- Reviewing the business model, strategy, and industry context
- Engaging with stakeholders (investors, customers, employees, regulators)
- Mapping issues against two axes: importance to stakeholders and impact on company value
- Prioritizing the issues that rank highest on both axes
The issues that come out on top form the backbone of the ESG report.
Why it matters
A materiality assessment helps companies focus on what’s most important, ensuring reports are meaningful for investors and regulators. It also helps align strategy with the issues that drive long-term value and resilience.
But here’s the big question for companies in the GCC: is single materiality enough? Or should you go further?
Double materiality: looking outward
Globally, many regulators from Abu Dhabi to the EU and UK require companies to go further with double materiality assessments (DMA).
Where single materiality looks inward (financial relevance, risks, and performance), double materiality looks outward by adding an assessment of the company’s impacts on people, society, and the environment, even where those impacts don’t have an immediate financial effect.
Why the difference matters
Even if a single materiality assessment is sufficient for satisfying local regulations (i.e. such as those mandated by MSX), some regional companies, such as Oman LNG, are voluntarily adopting a double materiality approach. This is highlighted in Oman LNG’s 2023 Sustainability report (Page 15), which evaluates issues based on both their financial materiality and impact materiality mapped against their significance to stakeholders and relevance to the company's strategic direction. This proactive approach reflects a growing commitment among some Omani firms to a more comprehensive and forward-thinking sustainability framework.
This is not just about compliance, it’s about visibility, credibility, and competing at an international level.
Three Pillars Consultancy (TPC)
For many companies, the challenge is knowing which path to take. Single materiality ticks the compliance box and satisfies MSX. Double materiality is becoming the benchmark for leaders who want to showcase their wider impact, build credibility, and capture international investment.
But choosing the right path, and running a credible, trusted process, isn’t easy. Limited ESG data, competing priorities, technical international processes and pressure from peers already moving ahead can make formal materiality assessments overwhelming.
That’s where TPC expertise comes in.
How TPC helps you chart the right path
● Clarity on approach – guidance on whether single or double materiality is the right fit for your business.
● Robust process – MSX-compliant single materiality, or an internationally aligned DMA process you can rely on.
● Digital dashboards – cloud-based tools to track, manage, and visualize your results in clear, accessible formats.
● Global positioning – align with international standards to boost credibility and attract investors.
● Actionable insights – use your materiality outcomes to engage stakeholders, manage risk, and guide strategy.
Whether you’re meeting MSX requirements with single materiality or positioning your company internationally through double materiality, TPC has the expertise to help you get it right — and navigate your sustainability journey with impact.
Contact Us Here to get your report on the right path from the start.
