Trucost News / 19 Dec 2016

Recommendations of the Task Force on Climate-related Financial Disclosures – Trucost comments

The Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD) has published draft recommendations to improve transparency on climate-related risks in financial markets.

Just over a year since its inception, The Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD) has published draft recommendations to improve transparency on climate-related risks in financial markets.

Trucost commends the TCFD’s leadership in elevating the importance of climate disclosure, focusing on the need to ensure a robust and strategically-focused account of climate risk is provided to capital market participants.

The TCFD recommends that all organizations, from companies to financial institutions, provide information about climate risk across four key themes: governance, strategy, risk management, metrics and targets. These recommendations seek to require companies to integrate climate risk management in forward-looking business strategies and financial planning, such as scenario analysis for alignment with government commitments to two degree energy transition pathways. Further, asset owners are advised to disclose the greenhouse gas emissions associated with each fund or investment, where data are available.

Dr. Richard Mattison, Managing Director and Head of Trucost, a wholly-owned subsidiary of S&P Dow Jones Indices, comments: ‘Financial institutions are increasingly integrating climate data in their investment strategies to manage risk and capitalize on the transition to a low carbon economy. A wealth of innovative green finance instruments are emerging, from carbon-efficient indices and funds to green bonds and lending tools. Enhanced climate disclosure will accelerate mainstream green finance as more relevant information reaches the market. By following the guidance of the TCFD, organizations will be well positioned to reap the rewards of enhanced capital flow.”

Trucost provides the data, tools and insight companies and financial institutions need to quantify exposure to climate risk, stress-test strategies and inform climate change mitigation and adaptation solutions.

Media contact:

Trucost: Sarah Aird, +44 (0)7971 841347, sarah.aird@trucost.com,

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