News items on the new TCFD rule and scope extension

For periods commencing on or after 1 January 2021, premium-listed commercial companies (including sovereign-controlled commercial companies) are required to include a statement in their annual financial report setting out:

  • Whether they have made disclosures consistent with the Task Force on Climate-related Financial Disclosures (TCFD’s) recommendations and recommended disclosures in their annual financial report.
  • Where they have not made disclosures consistent with some or all of the TCFD’s recommendations and/or recommended disclosures, an explanation of why, and a description of any steps they are taking or plan to take to be able to make consistent disclosures in the future – including relevant timeframes for being able to make those disclosures.
  • Where they have included some, or all, of their disclosures in a document other than their annual financial report, an explanation of why.
  • Where in their annual financial report (or other relevant document) the various disclosures can be found.

The rule is accompanied by guidance to help listed companies determine whether their disclosures are consistent with the TCFD’s recommendations and recommended disclosures. The guidance also clarifies the limited circumstances in which the FCA would expect in-scope companies to explain rather than disclose.

The FCA is extending these requirements to standard-listed companies, asset managers, life insurers and FCA-regulated pension providers for periods commencing on or after 1 January 2022. 

The Department for Business, Energy and Industrial Strategy (BEIS) has laid draft legislation requiring mandatory climate-related disclosures for UK public interest entities (UK PIEs), AIM companies, “high turnover” companies and LLPs (“high turnover” is defined as turnover of more than £500m per annum, pro-rated for shorter or longer periods). Companies and LLPs with fewer than 500 employees will be exempt. These requirements will take effect for periods commencing on or after 6 April 2022. The required disclosures are similar to the TCFD recommendations and will be accompanied by non-binding guidelines to assist in implementation.

The FRC has stated that it will pay particular focus on the quality of disclosures made by premium-listed companies against the new Listing Rule. Likewise, the FCA has stated in its recently issued Primary Market Bulletin 36 that it will work collaboratively with the FRC to identify instances of non-compliance, including reporting such instances to one another where discovered, and review concerns raised by stakeholders about the quality of TCFD-aligned disclosures.

Where a premium-listed company fails to make a suitable statement under the Listing Rules, the FCA will request that a listed company publishes the TCFD statement via a Regulatory Information Service (RIS) in line with the Listing Rules as soon as possible after discovery, with any non-compliance leading to regulatory action and possible sanctions.

This page includes a collection of our news items on the new TCFD listing rule and scope extension.

Related news

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.

FCA confirms final rules and guidance for climate-related financial disclosures for listed companies and certain regulated firms

19 Dec 2021

The Financial Conduct Authority (FCA) has published new climate-related disclosure rules for listed companies and certain regulated firms.

FRC announces thematic review and priority sectors for 2022/23

07 Dec 2021

The Financial Reporting Council (FRC) has announced its corporate reporting and audit quality review programme for 2022/23 alongside its priority sectors for review.

FCA emphasises importance of compliance with new TCFD Listing Rule

18 Nov 2021

The Financial Conduct Authority (FCA) has published Primary Market Bulletin 36 which focuses on the new Listing Rule (LR 9.8.6R(8)) requiring premium-listed companies to include a statement in the annual report confirming the extent to which they have made disclosures consistent with the Task Force on Climate-related Financial Disclosure (TCFD) Recommendations. This new rule comes into force for accounting periods beginning on or after 1 January 2021 with the first annual reports including those disclosures being published from January 2022.

FRC Lab publishes a report on better practice TCFD reporting

01 Nov 2021

The Financial Reporting Lab ("the Lab") has published a report to help companies prepare for mandatory Taskforce on Climate-related Financial Disclosures (TCFD) reporting.

FRC publishes findings on the quality of corporate reporting in 2020/2021

27 Oct 2021

The Financial Reporting Council (FRC) has published its Annual Review of Corporate Reporting 2020/2021. 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.

We comment on the FCA’s consultation paper CP21/18

11 Sep 2021

We have published our comment letter on Financial Conduct Authority’s (FCA's) consultation paper CP21/18 'Enhancing climate-related disclosures by standard listed companies and seeking views on ESG topics in capital markets' (“the CP”).

We comment on the FCA’s consultation paper CP21/17

11 Sep 2021

We have published our comment letter on Financial Conduct Authority’s (FCA's) consultation paper CP21/17 'Enhancing climate-related disclosures by asset managers, life insurers and FCA-regulated pension providers' (“the CP”).

FCA consults on further climate-related disclosure rules for listed companies and certain regulated firms

23 Jun 2021

The Financial Conduct Authority (FCA) has published new proposals on climate-related disclosure rules for listed companies and certain regulated firms. It highlights that currently the ‘quantity and quality of climate-related financial disclosures does not yet meet investors’ needs’.

FCA introduces new Listing Rule to enhance climate-related disclosures

22 Dec 2020

The Financial Conduct Authority (FCA) has published a Policy Statement (PS20/17) and final rule and guidance promoting better climate-related financial disclosures for UK premium listed commercial companies.

UK to make TCFD aligned disclosures mandatory by 2025

12 Nov 2020

The Chancellor, Rishi Sunak, has announced the intention to make Task Force on Climate-related Financial Disclosures (TCFD) aligned disclosures fully mandatory across the economy by 2025. This marks an important step in establishing consistent global climate and sustainability reporting standards.

We comment on the FCA’s consultation paper 20/3 'Proposals to enhance climate-related disclosures by listed issuers and clarification of existing disclosure obligations '

02 Oct 2020

We have published our comment letter on FCA’s consultation paper 20/3 Proposals to enhance climate-related disclosures by listed issuers and clarification of existing disclosure obligations (“the CP”).

FCA issues consultation paper proposing improvements to climate-related disclosures for listed companies

09 Mar 2020

The Financial Conduct Authority (FCA) has published a consultation paper (CP20/3) which proposes to enhance climate-related disclosures by companies with a UK premium listing and clarify existing disclosure obligations.

FCA publishes feedback statement on climate change and green finance

22 Oct 2019

The Financial Conduct Authority (FCA) has published a Feedback Statement (FS 19/6) on climate change and green finance.

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