TCFD

Overview

The Task Force on Climate-related Financial Disclosures (TCFD) was established by the Financial Stability Board in 2015 to develop a set of voluntary disclosure recommendations to provide stakeholders with information on their climate-related financial risks and opportunities. The TCFD has become a highly influential framework, gaining recognition and adoption across the globe. For example, the TCFD has been incorporated into national regulation across the globe in the UK, New Zealand, Hong Kong and more.

Scope & Adoption

The TCFD’s recommendations are structured around four thematic areas: governance, strategy, risk management, and metrics and targets. It encourages organisations to evaluate and disclose both the risks and opportunities posed by climate change to their operations. 

As of October 2022, over 3,800 organisations from 99 countries with a combined market capitalisation of $26 trillion have expressed their support for the TCFD.

Why it Matters

TCFD is seen as the golden standard for sustainability reporting; unlike other frameworks, TCFD is specifically tailored towards communicating the financial impacts of climate change on organisations. 

Scoring & How to report

There is no formal submission or scoring when applying the TCFD recommendations.The disclosure recommendations are designed to solicit decision-useful, forward-looking information on the financial impacts of climate-related issues. 

Alignment with other frameworks

TCFD’s recommendations have significantly influenced the global discourse on climate-related financial disclosures, serving as a foundation for other sustainability frameworks. The IFRS Sustainability Standards builds upon the TCFD framework which is reflected by its adoption of the same four pillars. Since the publication of the first two IFRS standards (IFRS S1 and IFRS S2), the IFRS has assumed responsibility for the TCFD.

TCFD with Nossa Data

Nossa Data offers a TCFD template for companies to respond to the 11 recommendations for climate risk and opportunity disclosure.

Start your TCFD Journey with Nossa Data

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Sources:

• https://www.fsb-tcfd.org/#:~:text=The%20TCFD%20has%20developed%20a,through%20their%20existing%20reporting%20processes.&text=Disclose%20the%20organization's%20governance%20around%20climate%2Drelated%20risks%20and%20opportunities.
• https://www.fsb-tcfd.org/recommendations/
• https://www.fsb-tcfd.org/about/
• https://www.fsb.org/2022/10/2022-tcfd-status-report-task-force-on-climate-related-financial-disclosures/#:~:text=For%20fiscal%20year%202021%20reporting%2C,Source%3A%20TCFD

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