Task Force Publishes Recommendations on Climate-Related Financial Disclosures
The Financial Stability Board (FSB), chaired by Bank of England Governor Mark Carney, welcomed the publication of the recommendations for effective disclosure of climate-related financial risks published today by the industry-led Task Force on Climate-related Financial Disclosures (TCFD).
The recommendations apply to financial-sector organizations, including banks, insurance companies, asset managers, and asset owners.
The TCFD made recommendations in four key areas:
Governance: Disclose the organization's governance around climate-related risks and opportunities.
Strategy: Disclose the actual and potential impacts of climate-related risks and opportunities on the organization's businesses, strategy, and financial planning where such information is material.
Risk Management: Disclose how the organization identifies, assesses, and manages climate-related risks.
Metrics and Targets: Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where such information is material.
The recommendations are intended to be:
adoptable by all organizations,
included in financial filings,
designed to solicit decision-useful, forward-looking information on financial impacts, and
focussed on risks and opportunities related to transition to lower-carbon economy.