Minister of State (Business, Energy and Industrial Strategy)
(Energy and Clean Growth) ():
Today, the Government published its consultation on proposals
requiring mandatory climate-related financial disclosures by
publicly quoted companies, large private companies and Limited
Liability Partnerships (LLPs).
In November 2020, the Chancellor of the Exchequer announced that
in order to accelerate progress on climate risk disclosures, the
UK will move towards mandatory Taskforce on Climate-Related
Financial Disclosures (TCFD) across major segments of the UK
economy by 2025, with a significant portion of requirements to be
introduced by 2023. This will make the UK the first G20 country
to make TCFD-aligned disclosures mandatory across the economy.
TCFD is an industry-led initiative which seeks to develop
recommendations for climate-related financial disclosures. In
2017, the TCFD launched their recommendations, which set out how
companies of any size, and in any sector or geography, could
better manage and disclose their climate-related financial risks.
Our proposed regulations will require companies to disclose
information in line with the four pillars of TCFD (Governance,
Strategy, Risk Management and Metrics & Targets).
High-quality disclosure of how organisations will manage the
material financial risks and opportunities arising from climate
change will improve transparency and encourage better informed
pricing and capital allocation. As a result, and over time,
TCFD-aligned disclosures will support investment decisions
aligned with our transition to net zero. Our ambitious proposals
will ensure the U.K. is leading the way ahead of COP26, where we
will have an opportunity to encourage other countries to
replicate our action.
