Top-down and bottom-up: how Karomia covers both
Karomia builds your DMA in two steps. The first gives you a fast, well-sourced starting point. The second confirms it with the people who know your company best.
Top-down: the AI pre-assessment
Before anyone is asked a question, the Karomia AI scores every ESRS subtopic on impact and financial materiality. It uses sector benchmarks, your own documents and public sources.
It then generates the impacts, risks and opportunities (IROs) behind those scores and scores each IRO against the ESRS 1 criteria. You get a first materiality matrix quickly, with the reasoning and sources behind every IRO.
Bottom-up: stakeholder engagement
Next, you ask people, internal and external, to score the selected IROs, through surveys, interviews or focus groups. Their answers, weighted by expertise and method, produce the final materiality results.
This step makes your DMA defensible under ESRS. It is what an auditor expects to see.
How the two fit together
The top-down step does not replace stakeholder engagement. It shows you where to focus it:
- topics that are clearly material
- topics that are clearly not material
- topics in the grey zone, close to the threshold, where stakeholder input makes the difference
A pragmatic approach: focus on what matters
Since the simplified ESRS (the Omnibus package), EFRAG no longer expects you to assess every subtopic with the same depth. If a topic is very likely material, or very likely not, you can document that conclusion and spend your stakeholders' time on the topics where the answer is unclear.
Karomia is built around this. Expect fewer IROs than before, fewer questions per stakeholder and a clear written conclusion for every subtopic, including the ones you did not put to stakeholders.