Sustainability Management
Materiality Analysis
USI annually conducts a materiality analysis using the AA1000 Stakeholder Engagement Standards and the AA1000 Accountability Principles of Inclusivity, Materiality, Responsiveness, and Impact as our framework to identify material issues for ESG disclosure. The assessment is conducted based on the Double Materiality principle referenced from GRI 3: Material Topics 2021, the ESRS, and the EU CSRD and integrated the Value Balancing Alliance (VBA) methodology, Harvard Business School Impact-Weighted Accounts methodology, London Benchmarking Group (LBG) framework, and TIMM Impact Evaluation framework to assess the significance of economic, environment, and people/human rights impacts mapped to sustainable issues. The results are then prioritized according to their significance, presented to the Sustainability Committee, and incorporated into our enterprise risk management process to serve as a reference for setting our long-term sustainability goals and strategies. This materiality assessment process is independently verified by a third-party assurance provider.
Phase I. Inclusivity: Identify Stakeholders & Design Sustainability Surveys
In 2023, we defined our 7 major stakeholders as: shareholders/investors/banks, employees, customers, suppliers/contractors, governments, industry unions/associations, and communities (including NGOs and the media).
We integrated the SDGs, GRI Standards, SASB Standards, TCFD and TNFD frameworks, RBA Code of Conduct, S&P Global CSA indicators, and MSCI ESG Rating indicators with our industry specific characteristics and ASEH's requirements and compiled them into 9 governance issues, 6 environmental issues, and 6 social issues, 21 sustainable issues in total.
Phase II. Materiality: Investigate Stakeholder Concerns & Double Materiality Impact Analysis
In 2023, we collected 1,372 Stakeholder Concern Surveys from external and internal stakeholders and identified issues of high stakeholder concern.
Using the EU concept of double materiality, we conducted an Operational Impact Survey to reflect Financial Materiality by measuring the impact of each sustainable issue on the Company's revenue, risks, customer satisfaction, and employee engagement. 90 senior executives and Sustainability Committee members filled out this survey as representatives of USI's operations.
To quantify Impact Materiality, apart from incorporating TIMM impact evaluation results, 39 managers and colleagues conducted an External Sustainability Impact Survey that includes 10 positive impacts and 7 negative impacts on the economy, environment, people/human rights and assesses the severity and likelihood of actual and potential impacts. The survey results identify 9 significant impacts, including 3 positive economic impacts, 2 positive, and 4 negative environmental impacts.
Impact Evaluation-External Sustainability Significance Impact
Double Materiality Results Matrix
Phase III. Responsiveness: Identify Material Issues & Define Topic Disclosures and Boundaries
We assessed the significance of the issues by cross analyzing the Stakeholder Concern Survey, Operational Impact Survey, and External Sustainability Impact Survey, then mapped it to previous material issues and consulted external experts and the Sustainability Committee to determine 14 material issues. The materiality assessment results were then reviewed and approved by the Board of Directors.
We mapped 19 GRI topic standards and 7 USI specific topics that respond to the material issues identified. Non-material issues such as Diversity & Inclusion are also disclosed in this report as they are essential in USI's sustainable development.
Following the principle of comparability, our 2023 Sustainability Report covers the material issues of the previous year. The structure of this report follows indicator reporting requirements and fully discloses USI's current policies and plans for fulfilling ESG sustainability development.
Material Issues Identification and Ranking
Phase IV. Impact: Formulate Long-term Goals & Evaluate Impact
USI's five Sustainability Taskforces have disclosed management approaches and strategies for each material issue according to their requirements, formulating 41 long-term goals.
In addition to quarterly Executive Team meetings, the Sustainability Taskforces also meet semiannually to review the progress of each goal. At the annual Sustainability Committee meeting, we review our achievements, make rolling adjustments, track sustainability trends, and manage the impact of our sustainability goals. We publicly disclose the direction, progress, and performance of our sustainability goals in our annual ESG Report.
