Carbon Credentials collaborated with GeSI (the Global e-Sustainability Initiative) to develop a Climate Scenario Analysis Framework to help ICT sector companies align with the Taskforce on Climate-related Financial Disclosures (TCFD) and understand the financial impact of climate change on their bottom-line.
The enabling role of the ICT sector
Over the next decade, ambitious action is needed from all sectors to transition to a more sustainable and zero carbon economy. The ICT sector has a key role to play in enabling the transition, by providing the technological development and data capabilities to disrupt markets and advance sustainable solutions. At the same time, the sector is at risk from the physical and transitional impacts of climate change.
Unlocking opportunity through transparent disclosure
Identifying and managing climate related risks and opportunities will prepare businesses for future regulatory disruption and cost, and identify new markets and revenue streams. Consistent and transparent disclosure will allow investors to make better decisions when allocating capital. It’s hoped that informed investors will finance the ICT enabled low-carbon transition and enable more stable and resilient economies.
Helping companies align to the TCFD recommendations
A key recommendation of the TCFD is for organizations to conduct scenario analysis in order
to understand how different climate futures could affect their business. Assessing the financial implications of climate-related risks and opportunities is not an easy task due to the uncertainty over the timing of climate impacts and the range of potential business consequences.
GeSI’s Climate Scenario Analysis Framework is structured around the climate-related scenario process recommended by the TCFD. It outlines a three-year roadmap so that processes become part of a company’s risk management, strategic planning and disclosure procedures. It will enable the ICT sector to share consistent, transparent disclosures with the investor community outlining the positive financial implications of climate related opportunities and climate related financial risks.
“This guide provides a Scenario Analysis Framework to enable our members to begin to construct their own climate scenario analysis and align to the TCFD recommendations.” said James Gowen – GeSI Chairman.
GeSI’s Framework enables a company to work through a process to assess the materiality of climate-related risks and opportunities, identify and define a range of climate scenarios, evaluate the financial impact and identify potential responses. It’s intended to facilitate internal discussions and provide scenario analysis outputs. Members of GeSI can use and adapt the Framework in multiple ways, depending on their specific needs.
GeSI’s mission is to build a sustainable world through responsible, information and communications technology (ICT)-enabled transformation. GeSI comprises 70+ members from the world’s leading technology companies, along with partners leading efforts to advance environmental and social sustainability. GeSI is a leading source of impartial information, resources and best practices for achieving integrated social and environmental sustainability through ICT.