Double Materiality Assessment
Ireland

Double materiality assessment in Ireland: European Union (Corporate Sustainability Reporting) Regulations 2024 (S.I. No. 336/2024)

Ireland transposed the CSRD through S.I. No. 336/2024, the European Union (Corporate Sustainability Reporting) Regulations 2024, signed into law in July 2024. The transposition amends the Companies Act 2014 to incorporate sustainability reporting requirements. The ESRS delegated acts apply directly, and the double materiality assessment under ESRS 1.20-33 applies without national modification. Ireland follows the standard EU phasing: Wave 1 (large PIEs with 500+ employees) from financial years starting 1 January 2024, Wave 2 (other large undertakings) from 1 January 2025, Wave 3 (listed SMEs) from 1 January 2026. Ireland's corporate population has a distinctive composition. The country hosts the European headquarters of many US multinationals (in technology, pharmaceuticals, and financial services), alongside a domestic economy dominated by SMEs in agriculture, construction, and services. For CSRD purposes, the Irish subsidiaries of US multinationals are separate reporting entities that must perform their own double materiality assessments reflecting their Irish operations and value chains. The materiality conclusions for an Irish-registered pharma subsidiary may differ significantly from those of the US parent group.

Regulatory context: Irish Auditing and Accounting Supervisory Authority (IAASA)

IAASA is Ireland's audit and accounting supervisory authority and enforces sustainability reporting for public-interest entities. IAASA has published guidance notes on CSRD implementation, aligning with ESMA's enforcement priorities. IAASA has identified the double materiality assessment as a priority review area for the first reporting cycles and expects entities to disclose the assessment process per ESRS 2 IRO-1 with sufficient detail for IAASA to evaluate compliance. Chartered Accountants Ireland (CAI) and CPA Ireland, the two main professional accounting bodies, have published practitioner guidance on sustainability assurance. Irish statutory auditors performing sustainability assurance must be authorised by their professional body and meet additional competence requirements. The recognised accountancy bodies have introduced sustainability assurance training programmes for their members. The Companies Registration Office (CRO) will receive sustainability statements as part of the annual return filing. IAASA's enforcement covers listed entities; non-listed large entities fall under the general Companies Act enforcement framework.

Practical guidance for Ireland

Irish entities should approach the double materiality assessment by first identifying which ESRS topics are potentially relevant based on their sector, operations, and value chain. For Irish subsidiaries of multinationals, the assessment must reflect the Irish entity's specific circumstances, not simply adopt the parent group's global assessment. A technology company's Irish operations (data centres, EMEA sales, software development) generate different materiality conclusions than the global group's aggregate profile. Engage stakeholders per ESRS 1.24. Irish employment law provides for employee consultation through existing structures (works councils are not mandatory in Ireland but some employers have them). For environmental topics, use data from the Environmental Protection Agency (EPA) Industrial Emissions Licence conditions, Integrated Pollution Prevention and Control (IPPC) licences, and greenhouse gas emissions data reported under the EU ETS. Ireland's pharmaceutical and chemical sectors face specific E2 Pollution materiality from manufacturing emissions and effluent discharge. The EPA's enforcement actions and compliance reports provide evidence for the materiality assessment. Data centres, a growing presence in Ireland, face E1 materiality from energy consumption (EirGrid reported that data centres consumed 21% of Ireland's total electricity in 2023) and E3 materiality from cooling water use.

Audit expectations

Irish statutory auditors performing limited assurance on sustainability reports must follow ISAE 3000 (Revised), with ISSA 5000 expected to replace it once adopted. IAASA's inspection programme will extend to sustainability assurance engagements. IAASA has signalled that it will assess whether assurance providers have adequate methodology, competence, and independence for sustainability engagements. For Irish subsidiaries of non-EU groups, the assurance provider must be authorised in Ireland. The entity cannot rely on assurance obtained at the parent group level in a non-EU jurisdiction unless the Irish regulatory requirements are met separately.

Ireland-specific considerations

Ireland's agricultural sector is a significant contributor to national greenhouse gas emissions (37.5% of total emissions per the EPA's 2023 inventory, the highest share in the EU). Large agricultural entities and food processors in scope of CSRD face acute E1 materiality. The government's Climate Action Plan targets a 25% reduction in agricultural emissions by 2030, creating financial materiality through potential restrictions on livestock numbers and fertiliser use. Ireland's status as a European hub for US technology and pharmaceutical companies creates specific CSRD challenges. These entities often have globally integrated operations where Irish manufacturing sites produce for worldwide markets. The double materiality assessment must capture the Irish entity's specific impacts (local emissions, water use, workforce conditions) and financial risks (regulatory compliance, supply chain dependency) rather than defaulting to the global group's assessment. The Central Bank of Ireland, which regulates financial services, has issued climate risk guidance for banks and insurers that overlaps with ESRS E1 requirements. Financial institutions regulated by the Central Bank should coordinate their prudential climate risk assessment with the CSRD double materiality assessment.

Common inspection findings

IAASA's 2024 readiness review found that many Irish public-interest entities had not begun the double materiality assessment process, despite Wave 1 reporting covering financial years from January 2024.

IAASA identified that Irish subsidiaries of multinational groups were relying on group-level sustainability data without performing entity-level materiality assessments, creating a compliance gap.

The EPA's enforcement reports on Industrial Emissions Directive compliance provide a ready-made evidence base for E2 materiality, but IAASA noted that entities were not consistently using this data in their ESRS assessments.

IAASA flagged that the Irish accounting profession's capacity for sustainability assurance was limited, with fewer than 200 practitioners having completed the required sustainability assurance training by mid-2024.

IAASA observed that Irish financial institutions were not consistently coordinating their Central Bank climate risk obligations with their CSRD double materiality assessment, leading to duplicated but inconsistent processes.