Companies not accounting for climate change adaptation

AMF report analyses 31 companies on their alignment to the EU taxonomy

Companies are not doing enough to take climate change adaptation into account, French regulator the Autorité des marchés financiers (AMF) has found.

The AMF has published a report, Le reporting taxonomie des sociétés cotées non financières, analysing 31 companies on their alignment to the EU taxonomy. The taxonomy and its delegated acts set out an evolving list of ‘eligible’ activities that contribute towards sustainability, against which companies that disclose non-financial factors have to report.

The report found generally what companies are reporting is satisfactory, however it highlighted that almost companies are only reporting on climate change mitigation and not adaptation.

It also found several companies have chosen not to declare the alignment of some of their activities due to legal uncertainties and few companies have identified sustainable investment plans, despite needing this information to inform transition plans.

“As part of its 2023-2027 strategic orientations, the AMF has made it a priority to promote more sustainable finance. We therefore pay the utmost attention to the quality of non-financial information, which is essential to ensure investor confidence,” said AMF chair Marie-Anne Barbat-Layani.

“The findings of this report, which are rich in lessons, will enable companies to continue their efforts to communicate the sustainability of their activities.”

The EU taxonomy has recently been extended to four new environmental objectives that will have to be taken into account from the next reports in 2024. These are: the preservation of biodiversity, the protection of marine and aquatic resources, the development of the circular economy and the prevention and control of pollution.