Very few companies are reporting on the financial impact of climate change on their organisation, according to the latest status report from the Task Force on Climate-related Financial Disclosures (TCFD).
The TCFD’s 2018 Status Report highlighted that while “many companies” disclose some climate-related information, very few are disclosing the financial impact that climate change is having on the organisation as a whole.
The report also warned that companies were only providing limited information on the strategic resilience of their businesses under different climate related scenarios.
In a media statement, accompanying the report’s launch, Michael Bloomberg, chairman of the TCFD, explained that it was important for companies to acknowledge the material impact that climate-related issues can have on the long-term health of their business.
He said: “The more companies know about the risks they face, the faster and more effectively they can address them — and the more they report that information, the better equipped investors will be to make smart decisions.”
The TCFD reported that the number of firms supporting the TCFD recommendations has now grown to over 500, with market capitalisations of over $7.9 trillion, and including financial firms responsible for assets of nearly $100 trillion. This compares with 100 firms when the recommendations were launched in June 2017. Bloomberg said this growth in the supporter base over the past year was encouraging.
“It will make the global economy more resilient and drive more capital to projects that are helping to reduce emissions and protect people from harm,” he added.
Bank of England governor Mark Carney also commented in his role as chairperson of the Financial Stability Board, noting that corporate climate disclosures were now becoming mainstream.
He said: “The TCFD’s status report based on companies’ 2017 financial filings, demonstrates the practical, decision-useful nature of the recommendations.
“A virtuous cycle will be created where more and better information creates the imperatives for others to adopt the TCFD and for everyone to up their game on the quality of information they provide.”