Our sustainability materiality process helps us report on the issues that matter most to our business and stakeholders.
Background
We undertook a Double Materiality Assessment (DMA) to define the ESG topics most critical to our operations in India. The objective was clear: to move beyond compliance-driven reporting and embed a sharper, evidence-backed understanding of where HUL creates the most significant external impacts — and where those same sustainability factors could materially influence our enterprise value, risk exposure, and strategic direction. This exercise was guided by Unilever’s Global DMA methodology and conducted through a structured four-phase process that integrated India-specific contextual insights. It was aligned with the European Sustainability Reporting Standards (ESRS) and a proactive, strategic initiative to enhance governance, prioritisation, and programme design.
Defining our material sustainability issues
A sustainability issue is material to HUL if it meets either of two conditions. Firstly, if it is considered a principal topic or an element of a principal topic, which could impact our business performance, resilience or access to capital (financial materiality). Secondly, if it is deemed to have an impact on people and the environment through our operations or value chain (impact materiality). Our assessment considers the views of our key stakeholders, including consumers, customers (including retailers), suppliers & business partners, planet & society (including communities, citizens, and governments), shareholders, and our employees.
Our materiality assessment approach
We have designed our materiality process and methodology to provide granular insights into the interests and concerns of our key stakeholders.
Step 1
Identification of Impacts, Risks & Opportunities (IROs)
We began by mapping our full value chain from sourcing and manufacturing to consumer use to understand where sustainability issues arise. Alongside this, we reviewed external signals — including regulatory developments, media trends, and industry benchmarks — to identify the sustainability topics most relevant to HUL. We used global standards including ESRS, GRI, SASB, and OECD guidelines among others along with Unilever’s global materiality framework, to compile a list of relevant issues. This was then refined into 32 Impacts, Risks, and Opportunities (IROs), grouped into 13 material topics.
Step 2
Impact Materiality Assessment to identify material impacts we are connected to
An impact is the effect an undertaking has or could have on the environment and people to which it is connected through its own operations or its value chain. Each issue was evaluated using clear criteria: how significant the impact is, how widespread, how likely, and how difficult it is to reverse. Impacts can be positive or negative in nature. We undertook an initial assessment of each potentially relevant impact to consider whether the matter identified had an actual or potential impact on the world.
Step 3
Financial Materiality Assessment to identify our material risks and opportunities
We undertook an assessment of each potentially relevant risk or opportunity identified, including the connection of impacts and dependencies, to determine whether it was financially material. This included regulatory, reputational, operational, and market considerations. Each item was scored for financial materiality based on its potential business impact and likelihood, using a structured framework.
Step 4
Validation and disclosure requirement mapping
The output of the DMA was validated with subject matter experts across Sustainability, Procurement, Human Resources, Marketing, Customer Development and Finance. The outputs of the assessment were consolidated using a weighted scoring model to reflect the perceived relevance and expectations of various stakeholders. We incorporated additional analysis on the material issues of other FMCG companies, mandatory and voluntary ESG reporting regulations, and news coverage including social media conversations.
Final scores were used to plot each of the 13 material topics on a Double Materiality Matrix, with societal materiality on one axis and financial materiality on the other. While the matrix offers a comparative visualisation, all 13 topics are considered material and inform our disclosures, risk oversight, and programme design.
There is a clear management oversight of the material ESG risks. The Materiality Risk Matrix has been reviewed and approved by HUL's ESG Committee. We commit to updating our assessment periodically (at least once in 2 years or event-based) to ensure it reflects changes in our business and the external context.