Learning Outcomes

By the end of this lesson, learners should be able to:

Explain the purpose of the SASB Materiality Map. Identify industry-specific disclosure topics relevant to a given sector. Describe how SASB uses sector-based accounting metrics. Explain how SASB integrates with IFRS S1. Explain the importance of comparability and benchmarking across peer companies.

Introduction

Where GRI is built around impact materiality and serves a broad range of stakeholders, the Sustainability Accounting Standards Board (SASB) takes a narrower, investor-focused approach. SASB standards identify the subset of sustainability topics that are reasonably likely to affect the financial condition or operating performance of companies within a specific industry — in other words, topics that are financially material to that sector.

Now consolidated under the IFRS Foundation and forming a key input into the ISSB’s industry-based guidance, SASB standards remain widely used both as a standalone framework and as a practical toolkit for identifying which sustainability metrics matter most to investors in a given industry. This lesson explores how SASB is structured, how its industry-specific approach works in practice, and how it supports comparability between peer companies.

1. SASB Materiality Map

The SASB Materiality Map is a visual, interactive tool that shows which of the 26 general sustainability issues SASB tracks are likely to be financially material for each of 77+ industries, organized into 11 sectors. Rather than presenting one uniform list of ESG topics for all companies, the Materiality Map highlights that, for example, water management is highly material for a beverage company but far less material for a software company, while data privacy shows the reverse pattern.

The Materiality Map serves two main purposes: it helps companies quickly identify a starting point for which topics they should investigate, and it helps investors compare disclosure priorities across companies operating in different industries within their portfolio.

2. Industry-Specific Disclosure Topics

Each of SASB’s industry standards specifies a defined set of disclosure topics considered financially material for that industry, along with the accounting metrics used to measure performance on each topic. Examples include:

For an oil and gas exploration and production company: greenhouse gas emissions, water management, and reserves valuation and capital expenditures tied to climate change. For a software and IT services company: data privacy, data security, and workforce diversity and engagement in the technology industry’s competitive talent market. For an apparel, accessories, and footwear company: labor conditions in the supply chain, raw materials sourcing, and chemicals management.

This targeted approach ensures that companies are not required to report on generic topics with little bearing on their financial performance, while still capturing the sustainability issues most relevant to their specific business model.

3. Sector-Based Accounting Metrics

Unlike broad narrative disclosures, SASB metrics are designed to function like accounting metrics — quantifiable, comparable, and auditable. Each metric specifies a precise unit of measure, calculation methodology, and scope. For example, a metric might require disclosure of the percentage of stores in regions with high or extremely high water stress, or the total amount of monetary losses from legal proceedings associated with data privacy.

This accounting-style precision is intended to make SASB metrics usable in the same rigorous way financial statement line items are used — supporting integration into financial analysis, valuation models, and investment decision-making.

4. Integration with IFRS S1

Since the IFRS Foundation’s consolidation of the Value Reporting Foundation (which previously hosted SASB), SASB standards have become a recommended source of industry-based guidance for applying IFRS S1. When identifying which sustainability-related risks and opportunities are material to disclose under IFRS S1, organizations are directed to consider the SASB Standards applicable to their industry as illustrative guidance, alongside other applicable requirements.

This integration means SASB has evolved from being solely a standalone reporting standard into an embedded component of the broader ISSB disclosure architecture, giving it continued relevance even as ISSB adoption grows globally.

5. Comparability Across Peer Companies

Because SASB metrics are standardized within each industry, they allow investors to compare sustainability performance directly between companies competing in the same space — for example, comparing the workforce safety metrics of two mining companies, or the customer data breach metrics of two telecommunications providers. This comparability is one of SASB’s core value propositions to investors, who need consistent, decision-useful data to evaluate financially material ESG risks across their portfolios.

6. Sector Benchmarking

Building on comparability, sector benchmarking involves systematically tracking how a company performs on its industry’s material SASB metrics relative to direct competitors and industry averages over time. Benchmarking supports several practical uses:

Identifying performance gaps that may signal financial risk or reputational exposure. Setting realistic, industry-relevant improvement targets. Communicating competitive positioning to investors and analysts. Informing engagement priorities for investors practicing active stewardship.

Comparison: GRI vs SASB Approach

Key Takeaways

The SASB Materiality Map identifies which of 26 sustainability issues are likely financially material across 77+ industries in 11 sectors. SASB industry standards define disclosure topics and accounting-style metrics tailored to each industry’s specific financial risk profile. SASB metrics are designed with precise units of measure and calculation methodologies, making them usable like financial accounting data. SASB has been integrated into IFRS S1 as recommended industry-based guidance following its consolidation under the IFRS Foundation. Standardized, industry-specific metrics allow investors to compare ESG performance directly between peer companies. Sector benchmarking uses this comparability to identify performance gaps, set targets, and inform investor engagement.