In December 2015 the FSB launched the industry-led Task Force on Climate-related Financial Disclosures (TCFD). The Task Force will develop a set of recommendations for consistent, comparable, reliable, clear and efficient climate-related disclosures by companies, as requested in the FSB’s proposal. This phase 1 report published by the TCFD on 1 April 2016 sets out recommendations on the scope and principles to be applied to the final recommendations and provides a review of the landscape of existing climate-related disclosures.
The report notes that the Task Force will focus primarily on developing recommendations for issuers of public securities, listed companies, and key financial-sector participants, although it is expected that it will be possible for the recommendations to apply more broadly. The Task Force will seek to promote and drive voluntary adoption by ensuring that its recommendations reflect a consensus view of leading practices for disclosure; advance principles of good governance, fiduciary duty, and stewardship; and provide a basis for consistent and comparable application by firms in countries throughout the G20.
The report concludes that climate-related disclosure remains fragmented and incomplete, with only a limited number of reporting regimes focusing on the financial risks posed by climate-related risks. In general, existing laws and regulations already require disclosure of climate-related risk in financial filings if it is deemed material.
More details about the Task Force are available on the TCFD website.