Asset manager and asset owner reporting to clients and beneficiaries may not be sufficient, says a new report from the TCFD.
Nearly 60% of the world’s 100 largest public companies now support or report in line with recommendations laid out by the industry-led Task Force on Climate-related Financial Disclosures (TCFD), according to its 2020 status report.
More than 1,500 organisations have expressed support for the TCFD recommendations, including more than 1,340 companies with a market capitalisation of USD 12.6 trillion and financial institutions responsible for assets of USD 150 trillion. This figure also includes 700 companies declaring support since the publication of the TCFD’s 2019 annual report – an increase of over 85%.
The 2020 report indicates a steady increase in climate-related financial information disclosure, both within the number of companies reporting and the quality of such reporting. But disclosure of potential financial impact of climate change upon business and business strategies remains low.
The report also shows that larger companies are more likely to disclose TCFD-aligned information, with an average of 42% of companies with a market capitalisation of greater than USD 10 billion disclosing information, and 15% for companies below USD 2.8 billion. Disclosures are primarily made in sustainability reports, the TCFD report noted, with information aligned with its recommendations four times more likely to be disclosed in sustainability reports than in financial filings or annual reports.
Investor demand for companies to report TCFD recommendations has also … [continues]
Read the full article on Regulation Asia’s sister publication, ESG Investor.