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Scenario Analysis Research Project

Background

The Financial Reporting Council (FRC) has commissioned the Scenario Analysis Research project to explore the use of scenario analysis by FTSE 350 companies.

The FRC published the results of its 2020 thematic review on climate change in November 2020. Building on from that thematic review, the objective of this project is to learn more about the processes through which companies develop their scenario analyses, how these processes shape the outcomes produced and how those outcomes in turn influence companies’ strategic planning and decision making. The over-riding purpose of the project and associated research is to inform FRC's future regulatory strategy and delivery.

As the use of scenario analysis in climate-related reporting is a relatively recent development, the project will investigate both climate and non-climate applications of scenario analysis, covering a broader range of companies. 

The project will be carried out by Alliance Manchester Business School (AMBS), University of Manchester, which will survey FTSE 350 companies initially with a questionnaire, followed by in-depth interviews with relevant teams and individuals from a representative sample of companies. The extent of scenario reporting in 2020/21 annual reports will also be analysed.

The AMBS team invite expressions of interest from individuals and teams within FTSE 350 companies who would like to participate and in particular those with recent experience of conducting scenario analysis, climate-related or otherwise. 

Status of the project 

The project was launched in May 2021.  The online survey has been launched and interviews will take place during May, June and July 2021.  Further information is available on the FRC website.

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