Sustainability materiality assessment

Managing business risks associated with climate and reducing our impact on the climate. 

Maintaining a workplace that is inclusive for all, that prioritises developing the skills of our people, supports wellbeing, and helps attract and retain the right talent to serve our clients. 

Embodying a culture of ethics, integrity and trust by continuing to embed our purpose, values and behaviours in our business.

Protecting and managing data and systems to safeguard the data of our clients and people.

Embedding sustainability into our business strategy and client services to meet evolving market needs.

To build an understanding of what sustainability-related risks and opportunities could affect our current and future prospects, we took into account our business model and value chain, relevant laws and regulations, resources and relationships, dependencies and impacts, and considered the following resources:

• Educational materials issued by the IFRS Foundation related to IFRS S1 and IFRS S2

• Disclosure topics in the Sustainability Accounting Standards Board (SASB) Standards, specifically SASB ‘Professional and Commercial Services Industry Standard’ 

• Recent pronouncements of other standard-setting bodies such as the European Sustainability Reporting Standards (ESRS) issued under the European Union (EU) Corporate Sustainability Reporting Directive (CSRD)

• Sustainability-related risks and opportunities identified by entities that operate within the professional services sector

• PwC network Enterprise Risk Management (ERM) framework, and 

• Local sustainability disclosures from individual PwC firms.

We complemented this assessment by using AI-enabled tools, reviewed by members of the project team for accuracy and relevance, to generate a list of potential sustainability-related risks and opportunities for completeness. 

The outcome of the above exercise informed our view of relevant subject matter experts (SMEs) to involve in the process. We identified individuals based on their roles and expertise across the PwC network. Input was gathered from a diverse group of SMEs with deep knowledge of PwC’s business.  

The SMEs assessed the financial materiality of the sustainability-related risks and opportunities for the PwC network. This was a qualitative assessment which considered the actual or potential nature, magnitude and likelihood of the risks and opportunities and relevant time horizons. Risks were assessed in line with PwC’s existing network ERM framework. 

Time horizons used:

• Short-term (0 to 12 months)
• Medium-term (1 to 5 years)
• Long-term (beyond 5 years)

To help refine, moderate and validate the results, we shared the outputs with a number of stakeholders and senior leaders within the business, as well as representatives acting as proxies for key stakeholder groups (such as our people and clients). Internal proxies who engage with relevant stakeholder groups on a regular basis acted as representatives for these groups.

Senior business leaders then determined which of the sustainability-related risks and opportunities could reasonably be expected to affect PwC’s current and future prospects to the greatest extent. No definitive scoring thresholds were applied in identifying the final list of most significant matters, but typically those with a higher magnitude and/or likelihood were considered to be of greatest business significance.