WWF welcomes report recommending climate-related financial disclosures in finance sector
Finance Ministers from G20 countries will consider the report at the G20 Summit starting on 7 July in Hamburg, Germany.
The report was prepared by the the Task Force on Climate-related Financial Disclosures (TCFD), under the auspices of the Financial Stability Board (FSB).
Margaret Kuhlow, leader of WWF’s global Finance Practice, welcomed the report and urged investors and companies to endorse and adopt the recommendations in their next financial cycle.
“The focus now must be on implementing the recommendations and gaining practical experience in making them part of routine financial statements. Real success will depend on near-team, widespread adoption by companies and investors.”
Asset owners also have an important role to play in influencing the organisations in which they invest to provide better, forward-looking, climate-related financial disclosures.
“Material and comparable disclosure expressed in financial risk categories and integrated into financial filings is a powerful instrument. Governments and financial regulators should now assess these recommendations in relation to existing national legislation and regulation on disclosures,” said Kuhlow.
A key emphasis needs to be put on transition risk scenario and forward-looking analysis. Stock exchange regulators are well-placed strategically to integrate the recommendations within their own listing environment.
Manuel Pulgar-Vidal, leader of WWF’s global Climate & Energy Practice said full implementation of the Paris Agreements requires not only predictable flows of finance and other resources, but some fundamental changes in the way the financial sector works.
“This report makes crucial recommendations in the area of disclosure of climate related financial risks. Implementing these recommendations can play a transformative role in aligning investment practices and financial flows with the long-term climate objectives of the agreement.
“Corporate early adopters will benefit by being able to be more competitive in our fast changing world, while decisively contributing to a better world for all.”
Andrea Marandino, Sustainable Finance and Corporate Risk Manager for WWF-UK, said the decision to extend the TCFD as a private-sector led industry initiative until mid-2018 was a positive move that now needed adoption by the private sector.
“We want to encourage the TCFD to support and monitor adoption of the recommendations but also encourage further work by industry groups, international bodies, or multi-stakeholder platforms on critical areas for progress,” she said.
Other critical areas for progress include the development of methodologies and tools for effective scenario analysis including the establishment of a standardised, industry-wide below 2°C scenario; and the launch of a best-practice guidance per sector group on key scenario elements and assumptions that companies and investors need to report against. All of these actions will allow for meaningful comparison of the data that becomes available as a result of the TCFD work,” Marandino said.
For further information, contact:
Andrea Marandino AMarandino@wwf.org.uk or
Mandy Jean Woods email@example.com