The recommendations of the Task Force on Climate-related Financial Disclosure (TCFD) was published mid-2017, and since then there has been a push to normalise the recommendations in corporate disclosures and business decision making.
An increasing number of countries are asking for TCFD aligned disclosures in the annual reporting process, CDP has incorporated the recommendations into its disclosure cycle, and investors are asking businesses to prove their future resilience and sustainability using TCFD alignment.
The Ecometrica Platform is the only software solution which can incorporate organisational sustainability reporting, detailed spatial analysis, and climate science all in one place. Ecometrica leading software platforms are used in conjunction for the most effective TCFD disclosure possible.
Different industry sectors and geographic settings have varying physical climate risks. Knowing which risks to focus on requires understanding your business, mapping the global footprint of its operations, and assessing against different future climate scenarios.
Ecometrica’s TCFD risk assessor comes pre-loaded with multiple future climate scenarios covering a wide range of temperature outcomes, including Paris aligned scenarios. By mapping your business’ direct operations, and its suppliers, you will quickly be able to understand the headline physical climate risks for each location, both direct and indirect.
Physical risk metrics include river flooding, heat extremes, cold extremes, water resource availability, energy demand, coastal flooding and sea level rise, and many more.
Transitional risks are those associated with the move to a lower-carbon economy, such as policy and legal, technology, market, and reputation. Understanding transitional risks can be a challenge as they can change instantly depending on a government or international agreement, or changes in the market or public opinion.
Using the Ecometrica Platform, all the published Nationally Determined Contributions (NDCs) are available alongside your business operation data. We will use a combination of our expertise and industry leading technology to provide insight on potential transitional risks material to your business. By mapping your direct operations and suppliers’ Greenhouse Gas emission data at the asset level, you can assess the potential transitional risk associated.
Scenario analysis is an important component of TCFD reporting – but it can also be a very complex part of the process.
To help simplify things, we distill data from numerous authoritative sources for Paris aligned scenarios and climate projections. With everything together in one place, we can help you understand potential impacts across your global operations and how these impacts are expected to change in future decades and with different climate scenarios.
We only make use of well-established scenario data, such as those based on the IPCC’s RCPs (Representative Concentration Pathways) so you can be sure that your results are reliable and TCFD compliant.
Risks vs opportunities
Investors and other stakeholders are interested not just in the risks posed to business from climate change, but also the opportunities. Including both shows that you have not just thought about how to protect your business but also how you can generate growth and profits in the years to come making your organisation a solid investment.
While traditionally corporate sustainability disclosures have focused on the business impact on the climate, TCFD alignment requires thinking about how the business will adapt to a changing climate.
Reporting in line with TCFD communicates to stakeholders that the company understands the importance of dual materiality when addressing climate change. It shows you understand that you not only have an impact on the climate but also that climate change has the potential to have a material impact on your business.