Crisis leads to innovation, to rethinking business models and to questioning the status quo. Against this backdrop, the climate crisis has led to an international initiative that addresses the challenges, highlights the opportunities and provides companies with a framework to address both: the Taskforce for Climate-related Financial Disclosures (TCFD).
The TCFD recommendations provide the basis for companies to improve their reporting of climate-related issues. There are several key reasons for companies to start implementing the TCFD recommendations including:
Momentum is growing globally for companies to align with TCFD, driven by multiple factors such as investor, shareholder, and regulatory/government expectations. The TCFD's latest Status Report found an exponential increase in both the number of companies reporting and the disclosure quality since the framework's publication in 2017.
The TCFD recommendations recognise that companies are at different stages of the climate risk journey. For example, the TCFD advises companies starting out to first undertake qualitative scenario analysis that progresses over time, while companies with more extensive experience may already be in a position to undertake quantitative analysis. Globally, while many organisations are identifying risks and opportunities, fewer companies are disclosing the actual financial impacts of climate change on their business and strategies, and even fewer are providing information on their strategies' resilience.
Amid this growing momentum, companies need to be thinking about what's expected of them, how they are currently performing, and where they want to get to. At a broader level, companies also need to understand how climate risk fits into their overall sustainability and net zero strategies. South Pole can help you navigate your climate journey and answer your most pressing climate risk questions:
South Pole Climate Risk Services - South Pole can partner with you, from initial risk mapping to building climate resilience across the business.
Companies often start with understanding their climate risk performance. This could include a gap analysis to understand how their existing reporting aligns with the TCFD, and to help them develop plans to bring it further in line. We also offer benchmarking for companies to understand their TCFD performance relative to peers in the sector and/or region.
The next step is to perform a scenario-based climate risk assessment, to identify key physical and transition risks and opportunities and analyse business impacts based on scenario analysis. Let our diverse team of experts support you in designing the required breath and depth of such an assessment, from identifying climate risk and opportunities “hotspots" through to an in-depth analysis of your most material climate risks and opportunities. We help you understand the business impacts of climate risks and act on the upsides of the low-carbon economy for your business. Alternatively, we can help review the robustness of existing climate risk assessments, particularly as this is a technical area that companies tend to struggle with.
Going beyond disclosure, we can help you integrate climate risks within your key organisational processes such as risk management and strategy to build business resilience. Engaging with cross-functional stakeholders across your company, we assess your climate risk integration maturity using our in-house framework and develop a roadmap of recommendations to reach your desired maturity.
No matter your company's position on the TCFD journey or climate ambition, we can support you to use the results to develop your TCFD-aligned disclosure and engage internal stakeholders on your climate risk journey.