The Taskforce on Climate-related Financial Disclosure (TCFD) is a framework launched by the Financial Stability Board (FSB) in 2015. The recommendations of the TCFD provide guidance to organizations on disclosing the financial impact of climate-related risks and opportunities. The recommendations consider 4 core disclosure elements:
Governance over climate related risks and opportunities.
Strategy – how climate change has the potential to impact business strategy and financial planning. Scenario analysis is recommended as a tool under this element.
Risk Management – process for identification, management, and integration of potential climate-related risks.
Metrics and Targets associated with climate-related risks and opportunities, including disclosure of Scope 1, 2 and relevant Scope 3 greenhouse emissions, and progress to targets.
Image Source: TCFD 2017
Since 6 April 2022 this is a mandatory reporting framework in the UK for:
- Organisations currently required to produce an annual non-financial statement (e.g. traded companies, banks and insurers with over 500 employees)
- UK-based AIM companies with 500 or more employees
- LLPs and non-listed companies with 500 or more employees and a turnover of more than £500M
Carbon Footprint provides cost effective support to clients with the environmental aspects of TCFD disclosure, including:
- Carbon Footprint Assessment or Carbon Footprint Verification, assessing or verifying of your organisation’s Carbon Footprint .
- Developing and monitoring progress to Targets for reducing emissions.
- Climate-related Scenario Analysis workshops and a report on the outcomes, including the key risks and opportunities identified for your business (Strategy).
We can also provide guidance on how to integrate these elements into your wider, TCFD-aligned risk management processes or annual financial reporting.