Climate-related news

Reporting on climate-change continues to be an area of specific focus for investors, regulators and other business stakeholders who are increasingly expecting clearer, more specific and quantified disclosures on material climate-related risks and opportunities affected businesses.

Whilst premium-listed commercial companies and companies with a standard listing of shares or Global Depositary Receipts (GDRs) representing equity shares will now be familiar with providing climate-related financial disclosures consistent with the the recommendations and recommended disclosures of the Task Force on Climate-related Financial Disclosures (TCFD) on a ‘comply or explain’ basis, new Climate-related Financial Disclosure Regulations ("CFD Regulations") will affect entities with a 31 December year-end for the first time in 2023.

These Regulations, approved by the UK Government in January 2022, require UK public interest entities, Alternative Investment Market (AIM) companies, banking and traded LLPs, and other UK companies and limited liability partnerships (LLPs) with more than £500m turnover to make climate-related financial disclosures with exemptions for companies and LLPs with 500 or fewer employees. Many companies in the scope of TCFD disclosures under the Listing Rules will also be in scope of the CFD Regulations and therefore need to ensure that their disclosures comply with those requirements as well. Non-binding guidance issued by the UK government sets out expectations as to what should be disclosed and will help in-scope entities comply with these new requirements.

Both the Financial Reporting Council (FRC) in its thematic reviews TCFD disclosures and climate in the financial statements and TCFD – metrics and targets and the Financial Conduct Authority's (FCA's) Review of TCFD-aligned disclosures by premium listed commercial companies set out their disclosure expectations in this area. They expect businesses to consider climate-related matters and their effects when providing a balanced and comprehensive analysis of their position and performance, together with a description of the principal risks and uncertainties that they face.

The European Securities and Markets Authority (ESMA) has also announced that it will focus on climate-related matters as part of its Common Enforcement Priorities for 2023 financial statements.

Additionally an FRC Lab report provides key messages for those companies making net zero commitments with a number of key messages reiterated within the FRC's Annual Review of Corporate Reporting 2022/23.

Whilst climate reporting is improving, regulators will be looking for continued improvement in 2023 and the FRC has indicated that this coming reporting season, as reporting becomes more established, the it is likely to enter into substantive correspondence with companies where their disclosures do not meet its expectations.

Looking forwards, the International Sustainability Standards Board (ISSB) has published its first two standards: IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures. The UK Government, in its 2023 Green Finance Strategy, reaffirmed its intention to adopt these standards for use in the UK, following a formal assessment of the standards and has stated its intention to finalise the endorsement decision on the ISSB standards in 2024. Once endorsed, consideration will then be given to the scope and timing of mandatory adoption of UK-endorsed ISSB standards for UK entities, with a phased implementation being considered.  In August 2023 the FCA announced plans to consult on proposals to update the Listing Rules to refer to UK-endorsed ISSB standards and is aiming to finalise its policy position on this matter by the end of 2024, with new requirements taking effect for accounting periods beginning on or after 1 January 2025.

This page includes all of our news on the financial reporting impacts of climate change.  

Related news

IFAC publishes a report on climate-related disclosure

15 Nov, 2022

The International Federation of Accountants (IFAC) has published a report providing insight into climate-related disclosure.

European Parliament adopts CSRD

10 Nov, 2022

The European Parliament has today adopted the Corporate Sustainability Reporting Directive (CSRD) proposed by the European Commission (EC) in April 2021.

IOSCO outlines need for timely sustainability disclosure and assurance standards

10 Nov, 2022

At COP27, the International Organization for Securities Commissions (IOSCO) has outlined the actions it undertakes to protect investors by mitigating greenwashing in financial markets, to contribute to sustainability disclosure standards benefitting issuers and investors, and to promote well-functioning carbon markets.

ISSB announces new Partnership Framework, CDP to incorporate ISSB climate standard into its disclosure platform

08 Nov, 2022

At the finance day of 27th United Nations Conference of the Parties (COP27), ISSB Chair Emmanuel Faber will introduce the ISSB’s new Partnership Framework with more than 20 partner organisations. In addition, CDP and the ISSB have announced that CDP will incorporate the IFRS S2 'Climate-related Disclosures' requirements into its global environmental disclosure platform.

ESMA announces enforcement priorities for 2022 financial statements

28 Oct, 2022

The European Securities and Markets Authority (ESMA) has announced the priority issues that the assessment of listed companies' 2022 financial statements will focus on. A special focus is on Russia’s invasion of Ukraine and climate-related disclosures.

FRC publishes findings on the quality of corporate reporting in 2021/2022

28 Oct, 2022

The Financial Reporting Council (FRC) has published its Annual Review of Corporate Reporting 2021/2022. The report sets out the FRC’s expectations of areas of corporate reporting that require improvement and highlights the ten most frequently raised topics where improvements to reporting quality are needed.

FCA launches consultation on Sustainability Disclosure Requirements and investment labels

26 Oct, 2022

The Financial Conduct Authority (FCA) has published Consultation Paper CP/22/20 'Sustainability Disclosure Requirements and investment labels'.

FSB calls for continued progress on disclosures on climate-related risks

17 Oct, 2022

The Financial Stability Board (FSB) has submitted to the G20 Finance Ministers and Central Bank Governors two reports as part of its work on addressing climate-related financial risks.

New TCFD status report

17 Oct, 2022

The Task Force on Climate-related Financial Disclosures (TCFD) set up by the Financial Stability Board (FSB) to develop voluntary, consistent climate-related financial risk disclosures for use by companies in providing information to lenders, insurers, investors and other stakeholders has published a fifth status report providing an overview of the extent to which companies in their 2021 reports included information aligned with the core TCFD recommendations published in June 2017.

PRA publishes its thematic feedback from the 2021/2022 round of written auditor reporting

14 Oct, 2022

The Prudential Regulation Authority (PRA) has published a letter to Chief Financial Officers of selected deposit-takers which provides thematic feedback from the PRA’s review of written auditor reports received in 2022.

G7 issues statement on climate disclosures and ISSB’s work

14 Oct, 2022

The G7 Finance Ministers and Central Bank Governors have released a statement underlining economic climate actions and its commitment ‘to move towards mandatory climate-related financial disclosures that provide consistent and decision-useful information for market participants and [it welcomes] the global baseline of sustainability reporting standards currently under development by the International Sustainability Standards Board (ISSB)’.

FRC Lab publishes report on net zero disclosures

13 Oct, 2022

The Financial Reporting Council (FRC) has published a Lab report on net zero disclosures which is an investor focus area with many companies estimating impact and disclosing climate commitments and transition plans.

FRC and FCA publish reports on TCFD compliance by premium-listed companies

03 Aug, 2022

The Financial Reporting Council (FRC) and the Financial Conduct Authority (FCA) have each published reports assessing the quality of Task Force on Climate-related Financial Disclosures (TCFD) by premium-listed companies which were required for periods commencing on or after 1 January 2021. The FRC also reviewed the extent of climate-related disclosures within the financial statements and provides better practice disclosures which it encourages companies to refer to when preparing or seeking to improve their own disclosures.

FSB progress report on addressing climate-related financial risks

14 Jul, 2022

The Financial Stability Board (FSB) has submitted to the G20 Finance Ministers and Central Bank Governors its first annual progress report on the July 2021 roadmap to address climate-related financial risks.

European Council and European Parliament reach an agreement on the corporate sustainability reporting directive (CSRD)

07 Jul, 2022

Following the provisional political agreement on the EU Corporate Sustainability Reporting Directive (CSRD), on 22 June 2022, the near final text for the CSRD has been published.

European Parliament and Council reach provisional agreement on CSRD

22 Jun, 2022

The European Council and European Parliament have reached a provisional political agreement on the corporate sustainability reporting directive (CSRD) proposed by the European Commission (EC) in April 2021.

FRC publishes updated Guidance on the Strategic Report

22 Jun, 2022

The Financial Reporting Council (FRC) has published an updated edition of its Guidance on the Strategic Report to incorporate the new climate-related financial disclosures, following changes in legislation made earlier this year, along with a number of other amendments which have been made to maintain alignment with legislation.

FRC Stakeholder Survey — ISSB Exposure Drafts

26 May, 2022

The Financial Reporting Council (FRC) invites stakeholders to share their views on the Exposure Drafts recently published by the newly formed International Sustainability Standards Board (ISSB).

Lab calls for participants for a new net zero disclosures project

05 May, 2022

The Financial Reporting Lab is calling for participants to participate in a new project looking at how net zero commitments are reported by companies and used by investors.

Finance for the Future Awards – now in their 10th year – open for entries

08 Apr, 2022

The Finance for the Future Awards 2022 are now open for entries to all organisations, globally, whether listed, small, charities, a social enterprise or public sector, and to individuals who drive change in this area.

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