Overview Carbon Water Waste Ecosystems Appendix 82 Appendix C Materiality— Approach and process In 2020 we worked with an external agency to carry out identifying a materiality assessment, following a six-step process: what matters Step 1 Step 2 Step 3 Step 4 Step 5 Step 6 Our material issues articulate what Identifying issues Refining the list Understanding Scoring the issues Prioritizing the Validating the We initiated our We carried out research internal and We applied issues outcomes matters most to our business and materiality assessment to refine the long list of external prioritization criteria We prioritized We held a workshop our stakeholders. This awareness by identifying a long list issues for stakeholders stakeholder and weighting to the Microsoft’s key issues that included the of potentially material to consider and rank. perspectives results of our using two parameters: company’s is crucial to identify and manage topics by using the Our research comprised Next we conducted a stakeholder interviews • The importance environmental our risks and opportunities, expertise of our an assessment of recent series of internal and and surveys to support of each issue to sustainability experts, external agency, media and social media external interviews issue scoring. stakeholders. including the Chief and to respond effectively to relevant sustainability conversations related to and surveys with key Issue scoring also Environmental Officer, our stakeholders. frameworks (including the environment, as stakeholders to gain included inputs from • The importance where the group GRI and SASB), as well well as relevant trends their perspectives on our external agency of each issue on reviewed, refined, and as Microsoft’s business and emerging issues. top issues. based on their industry business success. ultimately affirmed the and sustainability knowledge, best materiality results. mission and priorities. The stakeholders were practice, and selected based on their expectations. expertise and knowledge of Microsoft’s business.