HM Treasury has set out a three-year phased approach to implement the TCFD recommendations in central government annual reports and accounts.  In July 2023 it published its phase 1 guidance which addressed the recommended disclosures for the governance pillar applying to in-scope central government bodies' annual reports and accounts from 2023-24.

The exposure draft for Phase 2 sets out the disclosure requirements in the second year of disclosure and covers the risk management and metrics and targets pillars of the TCFD framework.  Phase 2 requirements will apply to reporting periods from 2024-25 (proposed effective date 1 April 2024) and expand upon the existing reporting requirements in Phase 1.  

The guidance will apply to all departments (ministerial and non-ministerial), as well as some central government and wider public sector bodies that meet certain criteria, or where they have been directed/instructed to follow the guidance by their respective relevant authority. Other central government and public sector bodies may voluntarily choose to follow the guidance in full or in part. 

Application guidance for Phase 3 will be issued in due course. 

Comments on the exposure draft are requested by 26 February 2024.  

A press release and the exposure draft are available on HM Treasury website.

Update 21 March 2024 - the application guidance for Phase 2 was published.  For more information see the HM Treasury website.

Update 24 April 2024 - a summary of responses to the consultation and specific changes to the application guidance was published on the HM Treasury website.