Name: The Taskforce on Climate-Related Financial Disclosure (TCFD): Your 4 minute guide
Uploaded: 2023-08-25T13:31:18.545Z
Duration: 240.8

MIMS TCFD V4_Final.mp4

MIMS TCFD V2_animated.vtt

English

{{00:00:00}}
Hi, I'm Ben Wielgus as a head of
sustainability for a large listed business.

{{00:00:05}}
One of the biggest pains in the behind that
we've been facing for the last few years is

{{00:00:10}}
a new piece of requirements called the TCFD.

{{00:00:33}}
What this means is emergent regulation and
investor expectations around the task force

{{00:00:40}}
for climate related financial disclosures.

{{00:00:49}}
Businesses need to understand the impacts of
climate change on their business, both positive

{{00:00:55}}
and negative, and then begin to quantify what those
mean in the future under a range of given scenarios.

{{00:01:02}}
Let me boil that down a little bit.

{{00:01:04}}
My company and many like it have had to really understand
how climate change is going to affect our supply chain,

{{00:01:11}}
our customer base, our end products, our financing, the
expectations around reporting, and then understand how

{{00:01:18}}
those will change over the next five, ten, or twenty years.

{{00:01:21}}
Whether the world wakes up to climate change and
makes really big changes to deal with it, or whether

{{00:01:26}}
we do nothing and we enter a period of climate
instability and crises that can cause other challenges.

{{00:01:33}}
Each of those scenarios will change the finance base
of our business and the end markets we operate in.

{{00:01:39}}
And by understanding this, we're now expected to
report to investors on what those scenarios mean

{{00:01:44}}
and what we're going to do to prepare for it.

{{00:01:51}}
The TCFD is so new that businesses are
approaching it in really different ways.

{{00:01:56}}
All of them are trying to map the impacts of climate
change on the business, but it depends whether you're an

{{00:02:02}}
agricultural business or an office based business, how
much things like extreme weather are going to affect you.

{{00:02:08}}
Similarly, depending on the products you produce,
you're going to have to consider how that changes the

{{00:02:14}}
end markets, whether you're in aviation or automotive,
or whether you're selling jumpers or computers.

{{00:02:20}}
Once you understand those impacts, you need
to choose those that you think will be most

{{00:02:24}}
significant and begin to quantify them.

{{00:02:27}}
That means trying to understand how key metrics change in
the future and then how those metrics impact your underlying

{{00:02:33}}
finances and your license to operate in your markets.

{{00:02:37}}
Finally, you need to choose how much of this
you want to disclose publicly, and that's

{{00:02:41}}
going to involve senior leadership sign off.

{{00:02:48}}
Large businesses in the UK and many elsewhere
where the investors are looking into this in more

{{00:02:53}}
detail have to disclose this information now.

{{00:02:56}}
And it's only going to expand to
cover more businesses in the future.

{{00:03:00}}
The biggest challenges are that business
disclosures right now are not comparable.

{{00:03:04}}
So even companies in the same sector aren't putting numbers
out there that allow investors to compare and contrast.

{{00:03:09}}
And I think that's going to change with
more guidance around what we've got to do.

{{00:03:14}}
So far, although investors seem to be
looking at this, It's all a bit hypothetical.

{{00:03:19}}
As we see the impacts of climate change bite more readily,
both in the physical world, but also in our markets and end

{{00:03:25}}
products, we're going to be expected to be more transparent
around how we make these calculations and what programs we

{{00:03:31}}
have in place to manage those and how well they're going.

{{00:03:35}}
It's all going to be about being ready for that
dialogue with investors, but also potentially being

{{00:03:40}}
open to more scrutiny from our customers, regulators.

{{00:03:44}}
And NGOs who want to force businesses
to prepare for a low carbon future.

{{00:03:49}}
So we avoid a high carbon future because
no business wants to operate in that world.

Hi, I'm Ben Wielgus as a head of
sustainability for a large listed business.

One of the biggest pains in the behind that
we've been facing for the last few years is

a new piece of requirements called the TCFD.

What this means is emergent regulation and
investor expectations around the task force

for climate related financial disclosures.

Businesses need to understand the impacts of
climate change on their business, both positive

and negative, and then begin to quantify what those
mean in the future under a range of given scenarios.

My company and many like it have had to really understand
how climate change is going to affect our supply chain,

our customer base, our end products, our financing, the
expectations around reporting, and then understand how

those will change over the next five, ten, or twenty years.

Whether the world wakes up to climate change and
makes really big changes to deal with it, or whether

we do nothing and we enter a period of climate
instability and crises that can cause other challenges.

Each of those scenarios will change the finance base
of our business and the end markets we operate in.

And by understanding this, we're now expected to
report to investors on what those scenarios mean

and what we're going to do to prepare for it.

The TCFD is so new that businesses are
approaching it in really different ways.

All of them are trying to map the impacts of climate
change on the business, but it depends whether you're an

agricultural business or an office based business, how
much things like extreme weather are going to affect you.

Similarly, depending on the products you produce,
you're going to have to consider how that changes the

end markets, whether you're in aviation or automotive,
or whether you're selling jumpers or computers.

Once you understand those impacts, you need
to choose those that you think will be most

That means trying to understand how key metrics change in
the future and then how those metrics impact your underlying

finances and your license to operate in your markets.

Finally, you need to choose how much of this
you want to disclose publicly, and that's

going to involve senior leadership sign off.

Large businesses in the UK and many elsewhere
where the investors are looking into this in more

detail have to disclose this information now.

And it's only going to expand to
cover more businesses in the future.

The biggest challenges are that business
disclosures right now are not comparable.

So even companies in the same sector aren't putting numbers
out there that allow investors to compare and contrast.

And I think that's going to change with
more guidance around what we've got to do.

So far, although investors seem to be
looking at this, It's all a bit hypothetical.

As we see the impacts of climate change bite more readily,
both in the physical world, but also in our markets and end

products, we're going to be expected to be more transparent
around how we make these calculations and what programs we

have in place to manage those and how well they're going.

It's all going to be about being ready for that
dialogue with investors, but also potentially being

open to more scrutiny from our customers, regulators.

And NGOs who want to force businesses
to prepare for a low carbon future.

So we avoid a high carbon future because
no business wants to operate in that world.

Make it Make Sense

Explainer

As the impacts of climate change become more evident, businesses need to be more transparent about their climate-related calculations. A new regulation recommends the information that firms should disclose to investors, regulators, and customers – the Taskforce on Climate-Related Financial Disclosure, or TCFD.
In this explainer, Ben Wielgus, Head of Sustainability at Informa, sets out how businesses must understand the impacts of climate change on their operation, and begin to quantify and disclose it.