As markets shift and stakeholders expect more of business, a new era of climate disclosure is here.

TCFD and Climate-Related Reporting

Markets are demanding more transparency, data, and storytelling about climate risk and opportunities. Assessments of financial risk associated with climate change are increasingly informing decision-making in global capital markets. Asset owners, investment managers, advisers, regulatory and standards-bodies argue that climate-related risks may be material.

 

The need to systematically assess climate risk is being driven by initiatives such as The Financial Stability Board's Task-Force on Climate Related Financial Disclosures (TCFD), the Bank of England's 2021 Biennial Exploratory Scenario (Climate BES), and the EU's Sustainable Finance Disclosure Regulation (SFDR). These developments point to the need for company financial statements and other continuous disclosures to reflect a rigorous assessment, analysis, and pricing of a company's liabilities and investments stemming from physical and transition climate risks.

Beyond risk mitigation, transparency expectations are increasingly turning to the climate and sustainability impacts of business activities. Corporate reporting regimes are evolving to enable evaluation of business models and performance in the context of intergovernmental agreements such as the Paris Agreement and Sustainable Development Goals (SDGs), as well as societal expectations and planetary boundaries.

 

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Are your EU investment funds SFDR ready?

European disclosure rules will eventually drive investors to align their portfolios with carbon reduction targets like net-zero carbon.

European investors are expected to be strongly focused on purchasing funds that are aligned with disclosures under Article 8 and 9 of the SFDR that promote ESG factors - including climate risk - along with those with a sustainable impact.

How we can help

Task Force on Climate Related Financial Disclosures (TCFD)
  • TCFD gap analysis

  • TCFD disclosure roadmap development

  • Transition and physical climate risk and resilience assessments

  • Deterministic and probabilistic climate financial scenario analysis (Cost Estimation, Real Options Analysis, Portfolio Optimization, Discounted Cash Flow and Value-at-Risk)

Climate Compliance Reporting
  • GHG emissions regulatory reporting

  • EU Non-Financial Reporting Directive (NFRD) reporting

  • EU Sustainable Finance Disclosure Regulation (SFDR) reporting

  • CDP and GRI climate reporting

Climate Impact Reporting
  • UN Principles for Responsible Banking (PRB) reporting

  • UN Principles for Responsible Investment (PRI) reporting

  • WEF Stakeholder Capitalism Metrics reporting

  • PCAF Scope 3 value-chain reporting