Organizations following the GRI Standards are required to report on material topics. Material topics are those issues that reflect the organization's significant economic, environmental, and social impacts or those that substantively influence the assessments and decisions of stakeholders. The rationale behind focusing on material topics is to ensure that the reporting is relevant and provides stakeholders with insights into the most impactful aspects of the organization's performance and sustainability efforts.
By concentrating on what is material, organizations can align their reporting with the interests and concerns of their stakeholders, thereby enhancing transparency and accountability. This approach supports organizations in identifying the key areas where they need to focus their sustainability strategies and allows them to communicate more effectively with stakeholders about their performance in those areas.
In contrast, while financial performance, annual staff numbers, and market share may be relevant to certain stakeholders, they do not necessarily encompass the broad spectrum of sustainability impacts that GRI emphasizes. Thus, reporting on material topics is central to adhering to the GRI Standards.