Skip to content

29 January, 2023

Subscribe Advertise About Us
  • My Account
  • Register
  • Log In
  • Log Out

Board Agenda

  • Governance
  • Strategy
  • Risk
  • Ethics
  • News
    • Categories

      • View All
      • Board Moves
    • stakeholder governance

      Threat to stakeholder governance from Twitter sale ‘overstated’

      Academics and experts argue stakeholder governance will always come second while the law puts the...

    • Davos resilience News round-up: this week in governance

      Lessons from Davos; companies risk sliding back on ethical practices; economics affects everyone; Sir John...

    • audit reform UK Audit reform in the UK risks ‘losing momentum’

      The Financial Reporting Council still awaits the proposed new statutory powers that would allow it...

  • Insight
    • Categories

      • View all
      • Governance
      • Strategy
      • Risk
      • Ethics
      • Board Expertise
      • finance
      • Technology
    • climate litigation

      Climate litigation: how 2022 will shape 2023

      This past year saw a rise in climate litigation, with a focus on the commercial...

    • value whistleblowing

      Why we need to value whistleblowing

      Encouraging staff to speak up and stop harm can reduce legal and reputational risk—both for...

    • HR corporate trust

      HR: How to build employee trust in corporate culture

      The right HR director is essential to lead on a culture that gets the best...

  • Comment
      • View all
    • A week of business moving to the centre of human rights

      A week of events signals the initiatives underway to have companies play a central role...

    • audit reform IIA Why we need audit reform right now

      There is an "urgent need" for reform to the audit landscape as well as internal...

    • climate change energy crisis Sustainability and climate change: the other energy crisis

      The world is addicted to cheap energy. We need to admit this and have the...

  • Interviews
      • View All Interviews
      • Podcasts
      • Webinars
    • Board priorities 2023 Board priorities 2023: tact, trust and transparency

      We asked key figures what would help boards this year. The answers ranged from 'smarter...

    • Group of investors/shareholders in glass building Climate issues likely to figure prominently at next year’s AGMs

      A recent webinar heard that say-on-climate voting is expected to rise, while ESG remains a...

    • NEDs role NEDs ‘needed more than ever’ in times of uncertainty

      The non-executive director’s role is to both challenge and listen to management, agreed the panel...

  • Careers
      • View all
      • Selection
      • Board Moves
    • NED recruitment News round-up: this week in governance

      Your country needs NEDs; governance does not compute; financial firms get more women on board;...

    • HR corporate trust HR: How to build employee trust in corporate culture

      The right HR director is essential to lead on a culture that gets the best...

    • powerful CEOs Boards want powerful CEOs in tough times

      Single-minded chief executives have greater staying ability when business conditions are uncertain, research finds

  • Resource Centre
      • White Paper Downloads
      • Book Reviews
      • Corporate & Advisory Services
    • Edelman Trust Barometer 2023

      2023 Edelman Trust Barometer

      The report is the result of the Edelman Trust Institute's research, which sampled more than...

    • Sophos 2023 Threat Report

      Barriers to entry for would-be cybercriminals are lower, with tools and tactics becoming available to...

    • The C-Suite Outlook 2023: On the Edge

      The Conference Board 2023 C-Suite Outlook survey reveals the events that C-suite executives see as...

  • Events
  • Search by topic
    • Governance
    • Strategy
    • Risk
    • Ethics
    • Regulation
    • ESG
    • Investor Relations
    • Selection
    • Board Expertise
    • finance
    • Technology

UK government set to implement mandatory TCFD reporting

by Gavin Hinks on February 13, 2020

The prime minister reportedly wants the UK to “lead the way” on reporting climate risks, using guidelines from the Task Force on Climate-related Financial Disclosures.

Warning sign alerting climate risk

Image: TrendObjects/Shutterstock

The move to have UK companies report on climate-related risks using guidelines from the Task Force on Climate-related Financial Disclosures (TCFD) got underway in earnest this week.

The UK has signalled its willingness to make the reporting guidelines mandatory, with amendments to legislation in the House of Lords that would give central government powers to force pension funds to use them.

According to the pensions minister Guy Opperman, speaking at a conference run by the campaign group Principles for Responsible Investment (PRI), the prime minister wants to see the UK lead the way on TCFD implementation.

Opperman told an audience of asset managers and owners that it was an “imperative” that in a post-Brexit world, the UK should break ground on ESG, green finance and green technology.

The TCFD is a project of the G20’s Financial Stability Board, formerly chaired by the US presidential hopeful Michael Bloomberg.

Shifting focus

The latest development has been on the cards for a while. Last year when the government revealed its Green Finance Strategy, TCFD reporting was a key part of the plan for shifting the focus of business, with the strategy making it clear the government would make plans for “all listed companies and large asset owners” to make disclosures using TCFD guidelines by 2022.

This week amendments to the Pensions Schemes Bill appear to give government the power to introduce regulations that would require “effective governance” of pensions schemes in relation to climate change while creating powers to require disclosures “relating to the effects of climate change”. The minister indicated this meant TCFD reporting.

However, experts have pointed out that though the powers will be in place for the Department of Work and Pensions, the details are yet to be finalised. Imposing TCFD on pension funds could depend on the rate of voluntary take-up. Some believe mandatory TCFD reporting will only happen for schemes whose scale reaches a certain threshold.

Campaigners warned pension funds that the use of TCFD disclosures could expose deficiencies in their efforts to manage climate-related risks in their portfolios.

Fergus Moffatt, head of UK policy at ShareAction, a charity campaigning for green investment, said: “Warm words will no longer be enough—the level of disclosure required under these laws would make it plain to see which pension schemes are really walking the talk on tackling the climate crisis and the risks it poses to our savings.

“As the UK hosts COP26 this year, all eyes will be on the current government to ensure this ambition reaches all areas of finance.”

Time to prepare

At PRI the move to mandatory TCFD reporting was welcomed too, even though asset owners who are signed up to its principles already use some elements of TCFD to disclose information.

According to Ed Baker, a specialist on PRI’s climate team, signalling that mandatory reporting is on the horizon gives notice to asset owners to begin preparations. He compared voluntary TCFD reporting to a “voluntary speed limit”.

“The risk is that there’s a significant proportion of the market that will not move until it’s mandatory,” he said.

The TCFD published its reporting guidelines in 2017. They have yet to be made mandatory anywhere and while voluntary adoption among companies has been encouraging, there have also been issues.

When the TCFD reported on progress last year it expressed concern about adoption.

“Given the urgent and unprecedented changes needed to meet the goals of the Paris Agreement, the Task Force is concerned that not enough companies disclosing information about their climate-related risks and opportunities,” its report said.

It added that climate-related information disclosure was improving but was “still insufficient for investors.”

It added companies need to provide more “clarity” on the impact of climate-related issues and while some companies disclose information on their climate “strategies”, they say little about their “resilience”.

  • Facebook
  • Twitter
  • Google+
  • LinkedIn
  • Mail

Related Posts

  • Companies urged to improve modern slavery reporting
    April 26, 2022
    Child labourer breaking rocks

    Research reveals one in ten UK companies fails to provide a modern slavery statement, despite it being a legal requirement.

  • Are UK corporate governance rules leading to market malaise?
    January 14, 2022
    Share listings board

    A recent article argued the UK needs "more directors who understand risk-taking, not virtue signalling" if London is to regain its status.

  • SEC unveils plan for mandatory climate reporting
    March 23, 2022
    US flag behind polluting factories

    SEC chair Gary Gensler says the measures will provide investors with “reliable information about climate risks to make informed decisions”.

  • Norges Bank backs mandatory US climate risk reporting
    July 25, 2022

    Heavyweight investor’s support boosts Securities and Exchange Commission’s controversial proposed US rules on board ESG disclosures.

For thoughtful journalism, expert insights on corporate governance and an extensive library of reports, guides and tools to help boards and directors navigate the complexities of their roles, subscribe to Board Agenda

climate risk, non-financial disclosures, reporting, Task Force on Climate-related Financial Disclosures, UK government

Search


Sign up to our Newsletter

Receive independent news, thoughtful journalism & expert insights about leadership, corporate governance & key boardroom issues straight to your inbox every week.

SIGN UP

Follow Us

 

 

 

 

Most Popular

  • Audit reform in the UK risks ‘losing momentum’
  • Activist investor campaigns rise back up to pre-Covid levels
  • How to ensure stakeholders trust your sustainability reporting
  • Elon Musk weighs in against ISS and Glass Lewis
  • Climate litigation: how 2022 will shape 2023
 

Featured Partner Profile

Diligent

Diligent

Diligent Corporation, which was founded in 2001, is headquartered in New York, NY with a European HQ in London. Diligent’s modern governance platform empowers leaders and teams at every level of the organisation to digitally transform and create ...

Featured Partner Resources

2022 AGM Season Forecast: An Eye on The Horizon

To help prepare for AGMs in 2022, Equiniti (EQ) hi...

Stakeholder Engagement: A Roadmap for UK Plc Boards

This guide aims to provide directors and their col...

Digital Boards: How Technology Adoption is Driving Culture Change and Resiliency

Digital tools proved their worth to boards during ...
Leadership in AI report

Leadership in AI

This report from Board Agenda and Mazars, in assoc...
Creativity in a Crisis: a Boardroom Map for Innovation

Creativity in a Crisis: a Boardroom Map for Innovation

In the uncertain times at the height of any crisis...
Board Directors Guide to D&O Liability Insurance - November 2020 - AIG & Board Agenda

Board Directors' Guide to D&O Liability Insurance

Directors face liability over a range of new threa...
Leadership-in-Risk-Management-Board-Report

Leadership in Risk Management: Board Report

Board Agenda, in association with Mazars and INSEA...
Director's Guide to Internal Investigations

A Director's Guide to Conducting Internal Investigations

An internal investigation must be handled meticulo...

 


 

ADVERTISE – FREE CORPORATE LISTING

FREE - Add your company profile to our Corporate & Advisory Directory.
ADD

ADVERTISE – PROMOTE YOUR REPORTS & WHITEPAPERS

FREE - Add your company profile to our Corporate & Advisory Directory.
Add Resource

Register Free

Register to receive free article views, selected resource downloads, and all the latest news alerts straight to your inbox. Register


  • Editors & Contributors
  • Editorial Advisory Board
  • Corporate & Advisory Services
  • Media Marketing Solutions
  • Contact Us
  • Careers
  • Board Director Network
  • Terms & Conditions
  • Privacy Policy
  • Cookies
  • Sitemap
|