Social Impact Research Launches "Materiality Report" Service to Connect Corporate Key Issues with Corporate Value Creation

Social Impact Research (Representative: Taku Kumazawa) has launched a new service, "Materiality Report," which analyzes and evaluates how corporate materiality connects to corporate value creation, based on integrated reports, securities reports, sustainability disclosures, and medium-term management plans of listed companies.

While traditional securities analyst reports have primarily focused on financial analysis, earnings forecasts, valuation, and stock price judgments, this service focuses on materiality, non-financial KPIs, human capital, intellectual capital, natural capital, business portfolio, sustainability strategy, and the quality of investor dialogue, which influence a company's medium- to long-term value.

Materiality is viewed not merely as a list of ESG issues, but as a driver of corporate value creation, visualizing how a company's key issues lead to sales growth, profit margin improvement, capital efficiency enhancement, lower capital costs, and PBR improvement.

Background of Service Launch

In recent years, the disclosure of materiality has become common in integrated reports and sustainability disclosures of listed companies. However, in many companies, materiality remains "a list of important issues" or "an organization of ESG activities," and the connection to business strategy and corporate value is often not sufficiently explained.

Meanwhile, investors are increasingly emphasizing not only short-term performance but also how companies transform social issues into growth opportunities, how they utilize non-financial capital, and how they generate future financial value.

In response to these environmental changes, Social Impact Research has developed the "Materiality Report" to reconstruct corporate materiality as a medium- to long-term corporate value creation story.

Differences from Traditional Securities Analyst Reports

If traditional securities analyst reports are "reports that evaluate a company's current value and short- to medium-term performance," then the Materiality Report is "a report that evaluates the structure that generates a company's future value."

Main Analysis Contents of Materiality Report

The Materiality Report primarily analyzes companies from the following perspectives:

- Whether materiality is connected to the purpose and long-term vision - Whether materiality is connected to the medium-term management plan and business strategy - Whether non-financial KPIs are connected to future financial value

- Whether key issues are explained not only as risk responses but also as growth opportunities

- How human and natural capital contribute to corporate value creation

- Whether it forms a value creation story that resonates with investors

- Whether explanations leading to PBR improvement, lower capital costs, and increased growth expectations can be made

Main Report Menus Provided

1. Materiality Assessment Report

Evaluates the appropriateness, strategic connectivity, and corporate value connectivity of materiality based on the company's integrated report and sustainability disclosures.

2. PBR Improvement Type Materiality Report

Analyzes materiality from the perspectives of growth expectations, capital profitability, and reduction of capital costs, and organizes a value creation story that leads to PBR improvement.

3. Non-Financial KPI Value Conversion Report

Visualizes how non-financial KPIs such as human capital, intellectual capital, natural capital, customer value, and governance lead to sales growth, profit margin improvement, and capital efficiency enhancement.

4. Integrated Report Improvement Report

Analyzes the materiality, value creation process, KPIs, president's message, and investor-oriented messages in the integrated report and provides improvement proposals.

5. Industry-Specific Materiality Comparison Report

Clarifies the uniqueness, competitive advantage, and disclosure improvement potential of the company's materiality through comparison with competitors in the same industry.

Features of This Service

1. Analysis of Materiality as a Corporate Value Creation Driver

Analyzes how key issues are converted into corporate value, rather than simply organizing ESG issues.

2. Integration of Financial and Non-Financial Information

Organizes non-financial information such as human capital, intellectual capital, natural capital, and social issue response as leading indicators for future financials.

3. Construction of a Story Usable for Investor Dialogue

Organized not only for improving integrated reports but also for use in IR briefings, investor meetings, president's messages, and board materials.

4. Utilization of a Unique Category Theory Approach

Structurally analyzes the relationships between purpose, business model, capital, materiality, KPIs, KGIs, financial value, and social value.

5. Support from Disclosure Improvement to Management Improvement

Beyond report creation, it can extend to materiality redesign, KPI/KGI design, integrated report improvement, and workshops for management.

Intended Use Cases

- Current status diagnosis for improving integrated reports - External evaluation before reviewing materiality - Connection and organization of medium-term management plans and sustainability strategies - Strengthening collaboration between IR and Sustainability departments - Enhancement of investor presentation materials

- Strengthening the explanation of non-financial value for PBR improvement

- Advancement of materiality discussions in board and management meetings

Target Companies/Departments

This service is aimed at the following companies and departments:

- IR departments of listed companies - Sustainability departments - Corporate Planning departments - Integrated Report Production departments - Companies seeking to strengthen disclosure of human capital, natural capital, and climate change - Companies aiming to enhance the appeal of their integrated reports to investors - Companies seeking to utilize non-financial information for PBR improvement, capital cost reduction, and corporate value enhancement - Integrated report production companies, IR support companies, and sustainability support companies

Representative's Comment

Social Impact Research Representative: Taku Kumazawa

"Securities analyst reports to date have primarily evaluated companies based on financial information and short- to medium-term earnings outlooks. However, when considering a company's medium- to long-term value, non-financial elements such as human capital, intellectual capital, natural capital, response to social issues, and business portfolio transformation cannot be ignored.

Materiality is not just a list of ESG issues. It is a blueprint for corporate value creation that shows which key issues a company chooses, which capital it invests, and how it simultaneously creates social and financial value.

Our Materiality Report goes beyond evaluating corporate disclosures; it is provided as a practical tool connecting management strategy, IR, sustainability, and investor dialogue."

Company Overview

Company Name: Social Impact Research Business Description: Sustainability management support, integrated report analysis, materiality assessment, impact assessment, corporate value creation story construction, non-financial information disclosure support Representative: Taku Kumazawa

Inquiries

Social Impact Research Materiality Assessment Report Business Department Contact: [email protected]