Task Force on Climate-related Financial Disclosures (TCFD)
The Task Force on Climate-related Financial Disclosures (TCFD) is a global initiative established by the Financial Stability Board (FSB) to provide a framework for companies and financial institutions to disclose climate-related risks and opportunities in their financial reporting. The TCFD framework provides recommendations for companies and financial institutions to voluntarily disclose information on how climate-related risks and opportunities are integrated into their governance, strategy, risk management, and metrics and targets. The framework focuses on four key areas: governance, strategy, risk management, and metrics and targets. The TCFD framework encourages companies and financial institutions to disclose both the physical risks of climate change (such as extreme weather events, sea level rise, and resource scarcity) and the transition risks associated with the shift to a low-carbon economy (such as policy changes, technological advancements, and changing consumer preferences). By disclosing this information, organisations can provide stakeholders with a clearer understanding of how climate-related risks and opportunities may impact their financial performance, operations, and value over the short, medium, and long term.
