Free Practice Questions for GRI ESRS-Professional Exam

2023/2772, various EFRAG guidance documents, and reports related to CSRD, ESRS, stakeholder engagement, double materiality, external assurance, and digital reporting Study guide References at the end of each question

Under the ESRS framework,employee-related datasuch asheadcount, turnover, and health and safety statisticsare typically the responsibility of theHuman Resources (HR) department. HR is responsible for managing workforce metrics, diversity, inclusion, hiring, terminations, and employee well-being, including health and safety programs.

WhileHealth and Safety (H&S) teamsmay contribute data related to occupational safety and health incidents, the responsibility foraggregating and reportingon overall workforce statistics lies with HR. TheCompliance departmentensures legal and regulatory adherence but does not maintain core employee records, whileMarketinghas no role in employee-related data reporting.

ESRS S1-6:Characteristics of the undertaking’s employees, requiring disclosure of total headcount and workforce breakdown​.

ESRS S1-14:Health and Safety Metrics, detailing occupational safety measures, incidents, and employee well-being programs​.

EFRAG Implementation Guidance on Workforce Reporting, which confirms HR as the responsible entity for employee data aggregation​.

ESRS References:

Impact materiality is indeed considered thestarting pointfor thedouble materiality assessmentin the ESRS. The reason is that material impacts on sustainability matters cangenerate financial risks and opportunitiesin the future. TheESRS frameworkfollows this structure because:

Interrelation Between Impact and Financial Materiality

Double materiality includestwo dimensions:a)Impact materiality(how the company affects people and the environment).b)Financial materiality(how sustainability matters affect the company’s financial performance).

Impact materiality assessments oftenprecedefinancial materiality because many sustainability issues initially manifest asexternal environmental and social impactsbefore affecting the company’sfinancial results​.

Regulatory Confirmation of Impact as the Starting Point

According toESRS 1, section 3.3, impact materiality is typically assessedfirst, unless afinancial risk or opportunity exists independentlyof an impact​.

A sustainability mattermay become financially materialover time due to regulatory changes, evolving market expectations, or direct financial consequences.

Illustration of the Double Materiality Process

Example: A company engaged inhigh carbon emissionsmight initially consider this animpact materiality issue(environmental harm). However,increased carbon pricing, regulatory changes, and shifting investor preferencescan latertransform this into a financial materiality issue.

Conclusion:Sinceimpact materiality serves as a precursorto financial materiality in most cases, the statement istrue.

Official Commission Delegated Regulation (EU) 2023/2772, various EFRAG guidance documents, and CSRD-related references:

Commission Delegated Regulation (EU) 2023/2772, ESRS 1, Section 3.3:Double Materiality Framework​.

EFRAG Compilation of Explanations (January - July 2024): Confirmation that impact materiality assessment is the typicalentry point​.