A mid-sized Polish manufacturing group – supplying automotive components across three EU member states – faced its first Corporate Sustainability Reporting Directive (CSRD) reporting cycle. The board understood that CSRD required a sustainability report. What it did not anticipate was the double materiality assessment: a structured process that determines which sustainability topics the company must actually report on. The gap between expectation and reality created real compliance risk.

CSRD requires every in-scope company to conduct a double materiality assessment before drafting its sustainability report. The assessment examines two dimensions: how sustainability issues affect the company's financial performance (financial materiality), and how the company's activities affect people and the environment (impact materiality). Both dimensions must be evaluated independently, then combined to produce a final list of material topics that shapes the entire report structure.

This case study walks through the background, the legal strategy applied, the step-by-step process, and the lessons that transfer directly to other Polish companies facing their first assessment. It draws on an anonymised engagement completed in the Silesia region during winter 2025–2026.

What was the company's starting position?

The client was a limited liability company registered with the National Court Register (KRS), employing approximately 480 people across two production sites. Its parent entity – a German holding company – was already subject to CSRD under the large-undertaking threshold. Polish subsidiary reporting obligations therefore arose one year earlier than the client had originally planned. The Polish Financial Supervision Authority (KNF) had issued guidance confirming that subsidiary obligations follow the parent's timeline where consolidated reporting applies.

The company had no prior ESG reporting structure. It had a basic code of conduct and a whistleblower channel (required under the Polish Whistleblower Protection Act), but no formal compliance programme covering environmental or social metrics. AML procedures existed but were siloed from sustainability governance entirely. The internal audit function had never mapped sustainability risks against financial exposure.

Our team at KORDECKI & Partners was engaged six months before the reporting deadline – enough time to run a proper assessment, but tight for a company starting from zero. We secured a structured materiality output covering 14 sustainability topics for this client in Silesia (winter 2025).

How did we structure the double materiality process?

Double materiality assessment under CSRD follows the European Sustainability Reporting Standards (ESRS) framework. The process has four sequential steps: scoping, stakeholder engagement, scoring, and validation. Each step has a defined output. Skipping any step creates gaps that auditors – and, in Poland, the Polish Agency for Enterprise Development (PARP) in its capacity as a national guidance body – will identify during assurance review.

In step one, we mapped the company's value chain. Upstream suppliers (raw steel, plastics, coatings) and downstream customers (automotive OEMs in Germany and Czech Republic) were included. This extended scope is non-negotiable under ESRS: impacts and risks outside the company's direct operations must be considered. The value chain mapping took three weeks and produced a long list of 38 candidate sustainability topics.

Step two involved structured stakeholder engagement. We designed a questionnaire covering both financial risk perception and impact concerns. Forty-one respondents participated – employees, key suppliers, two institutional customers, and one local community representative from the municipality adjacent to the larger production site. Engagement must be documented. A 30-day engagement window is the minimum we recommend to satisfy assurance requirements.

  • Value chain mapping (upstream and downstream)
  • Stakeholder identification and engagement documentation
  • Scoring matrix for financial and impact dimensions
  • Validation by senior management and external legal review

What scoring approach did the assessment use?

Scoring is where complexity meets practical risk. Each candidate topic receives two scores: a financial materiality score (likelihood and magnitude of financial effect) and an impact materiality score (scale, scope, and irremediability of the impact). A topic crosses the materiality threshold if either score – independently – exceeds the agreed cut-off. This "or" logic is deliberate under ESRS and is frequently misunderstood by companies applying a simple average.

For this client, the scoring matrix used a 1–5 scale on each dimension. Topics scoring 3 or above on either axis were treated as material. Fourteen topics cleared that threshold. They included greenhouse gas emissions (Scope 1 and 2), energy consumption, occupational health and safety, supply chain labour conditions, and water use at the larger site. Six topics scored high on impact materiality but low on financial materiality – meaning they required disclosure even though they did not threaten the company's balance sheet directly.

This outcome surprised the board. Directors had assumed that low financial exposure meant low reporting obligation. The opposite is often true: a company can cause significant environmental or social harm without suffering immediate financial consequences. CSRD closes that gap. Personal liability of directors for materially incomplete sustainability reports is a live risk under Polish corporate legislation – a point we raised explicitly during the validation session.

For context on how compliance programme architecture interacts with ESG obligations, see our guide on compliance programme design for Luxembourg subsidiaries in Poland.

What lessons transfer to other Polish companies?

Three lessons from this engagement apply broadly to Polish companies entering their first CSRD cycle. First, start the assessment at least nine months before the reporting deadline. Six months was manageable here only because the client responded quickly and had clean corporate records in the KRS. Companies with fragmented ownership structures or missing historical environmental data will need longer.

Second, do not treat double materiality as a purely internal exercise. Stakeholder engagement is not optional decoration. Auditors performing limited assurance – mandatory from the first reporting year – will test whether the engagement was genuine and documented. A questionnaire sent to three employees does not satisfy the standard. We recommend a minimum of 30 external respondents covering at least two value chain tiers.

Third, connect the materiality output to existing compliance infrastructure. This client's whistleblower compliance channel, its AML procedures, and its supplier code of conduct all became inputs to the materiality scoring. Companies that run ESG reporting in isolation from their compliance lawyer and legal team create duplication and contradiction. ESG reporting in Poland is a legal exercise, not a communications project.

For companies operating Ukrainian or CIS subsidiaries alongside Polish entities, cross-border materiality alignment raises additional questions addressed in our guide on compliance programme design for Ukraine subsidiaries in Poland. Workforce classification questions – particularly relevant where contractors are used extensively – also interact with materiality scoring; see our analysis of B2B reclassification risk and PIP enforcement powers in 2026.

The transferable checklist from this engagement is short but non-negotiable:

  • Confirm your CSRD in-scope status and reporting deadline (large undertaking or subsidiary consolidation)
  • Map your full value chain before scoping candidate topics
  • Document stakeholder engagement with named respondents and dated records
  • Apply the "or" logic in scoring – financial and impact dimensions are independent
  • Validate the final topic list at board level and retain the working papers for assurance

Your company's specific materiality profile depends on sector, geography, and value chain structure. A generic template forfeits the legal protection that a properly documented assessment provides – and precludes the ability to challenge an auditor's finding later.

To receive an expert assessment of your CSRD double materiality process, contact info@kordeckipartners.com.

Frequently asked questions

Q: How long does a double materiality assessment typically take for a first-time Polish company?

A: For a company with no prior ESG data, a realistic timeline is six to nine months from kick-off to validated output. The longest phases are value chain mapping and stakeholder engagement. Companies that compress this to under three months typically produce assessments that fail limited assurance review.

Q: Is it a common misconception that only large companies need to conduct a double materiality assessment?

A: Yes. Subsidiaries of large EU parent companies may be pulled into the CSRD reporting scope on the parent's timeline, regardless of their own size. Polish subsidiaries of German or French holding companies are the most common example. The National Court Register (KRS) registration status does not determine scope – the parent's consolidated reporting obligation does.

Q: What does a double materiality assessment cost?

A: Costs vary with company size and value chain complexity. For a mid-sized Polish manufacturer, a legally defensible assessment – including stakeholder engagement design, scoring, and validation – typically requires between PLN 40,000 and PLN 120,000 in combined legal and advisory fees. Attempting to cut this to a one-week internal exercise creates assurance risk worth multiples of the saving.

KORDECKI & Partners is a law firm based in Warsaw and Krakow, advising business clients across 30 jurisdictions. Our team combines expertise in Polish and international law with a practical approach to ESG compliance, CSRD implementation, and sustainability reporting. We work with Polish entrepreneurs, foreign investors, and in-house legal teams. To discuss your situation, contact info@kordeckipartners.com.

Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. KORDECKI & Partners assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@kordeckipartners.com.