The WFE supports the proposed updates to the guidance, which will provide a foundation for reporting on climate related risk and opportunity. Since issuing its final recommendations in 2017, the TCFD framework has played a pivotal role in improving climate-related disclosure practices—with formal endorsement amongst the WFE membership continuing to grow.

The draft guidance seeks to encourage a more systematic approach to the selection and disclosure of metrics by introducing a set of cross industry climate- related metrics. This is vital to help all participants within the financial services ecosystem access clear, consistent, and comparable sustainability related data. The WFE makes the following recommendations to further strengthen the guidance:

• The adoption of a standardised format for climate-related targets.
• Encouraging organisations to provide climate-related opportunity metrics, such as ‘green revenues’.
• Taking a proportionate approach to reporting expectations with regards to Small and Medium-Sized Enterprises.
• Robust calibration of performance metrics when tying executive compensation to climate targets.
• Support for a materiality assessment which is reflective of the diverse range of views on this subject.

Nandini Sukumar, Chief Executive Officer, the WFE said: “The risks presented by climate change to business and society are clear, and we fully support the TCFD’s efforts to further refine its disclosure framework. As an industry that sits at the heart of the financial services ecosystem, we see many benefits in a globally consistent approach to disclosure that promotes transparency and accountability as well as effective capital allocation towards greener solutions.”