In the wake of the 2008 financial crisis, the G20 set up the Financial Stability Board (FSB) to identify and manage risks to the stability of global financial markets. The FSB recognises that climate change represents a new and emerging vulnerability in the financial system. To address this risk, the FSB established the Task Force on Climate-Related Financial Disclosures (TCFD) which is chaired by Michael Bloomberg and consists of 32 members including Unilever, Blackrock, Barclays, Aviva Investors, Mitsubishi, Tata Steel, PwC, EY, Deloitte, and KPMG.
In June 2017, the Task Force published recommendations for voluntary and consistent climate-related financial risk disclosures for use by companies, investors and other financial stakeholders to provide high-quality information in their mainstream filings.
The purpose of the TCFD recommendations are to improve financial disclosure so that investors can make better-informed decisions on where to deploy their capital.
Companies and investors need to be aware of the risks from climate change. We believe they will become increasingly important factors in investment decisions, potentially devaluing an organisation or rendering it obsolete, if ignored.