Banks should disclose lending to companies with carbon-related risks

  • New report by the Task Force on Climate-related Financial Disclosures (TCD), a G20 initiative led by Governor of the Bank of England and former Mayor of NYC Michael Bloomberg, outlines how companies should disclose climate-related information in their financial filings, with the aim of allowing economies to properly value climate-related risks

  • Report recommends that companies should disclose all of their direct and indirect greenhouse gas emissions, and describe the risks and opportunities caused by climate change under a range of potential scenarios
  • The TCFD was established at the COP21in Paris by the Financial Sustainability Board (FSB). The FSB was created by the G20 in the aftermath of the 2007-08 GFC
  • While banks have a shorter outlook than insurers, they have an important role in steering the entire economy – they need to know which are the sectors that have a high risk of stranded assets in the future and those with a low risk of stranded assets in the future
  • Chief executive of French pension fund ERAFP and vice chair of the UK’s Institutional Investor Group on Climate Change said: “The more companies report effectively on climate-related risks and opportunities, the easier it becomes for investors to allocate the substantial amounts of capital required to implement the Paris Agreement and to work on their own climate.”

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s