The chief executives of 27 of the world’s largest businesses have called on the G20 to formally accept and act on recommendations set out by the Task Force on Climate-related Financial Disclosures (TFCFD) last year.
In December last year the TFCFD published a series of recommendations, backed by the likes of Bank of England governor Mark Carney, established to provide financial markets with the transparency to determine how companies were prepared for the potential effects of climate change.
And in a joint statement published by the World Economic Forum late last week, the 27 business leaders expressed their “strong support” for the recommendations and went one further, urging the G20 to back them as well.
“We urge the G20 to formally accept the recommendations of the TCFD and send a strong signal that government leaders desire more transparency from business regarding the financial implications of climate change on their short and long-term strategy and operations. We welcome the current TCFD recommendations, and will actively support their successful implementation,” the statement reads.
It goes on to put forward a number of other areas in which global governments can help with the adoption of the TFCFD’s proposals, including setting out that part of a company’s board’s responsibility is to mitigate long-term risks and the development of guidance and standards to support corporate transparency.
“We are fully aware that climate-related financial disclosure is not the only mechanism needed to help implement the Paris Agreement. It needs to be complemented by a suite of mechanisms - for example, effective carbon pricing and phase-out of fossil fuel subsidies - that incentivise a shift of investment to climate smart activities and assets. However, improved and more consistent disclosure of climate-related financial risks will go a long way in enabling constructive and well-informed dialogue between investors and companies about the financial risks and opportunities associated with their activities.
“We strongly support the TCFD recommendations and encourage other businesses to do the same.”
The 27 co-signees include the chief executives of major finance firms such as HSBC, Allianz and Capricorn.
Also included are energy firms Enel, ENGIE, Iberdrola and Jinko Solar.