Climate Disclosure Standards Board responds to financial institutions research

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04 May 2011

The Climate Disclosure Standards Board (CDSB) has published a report entitled Financial Institutions, Taking Greenhouse Gas Emissions into Account.

The report was commissioned and funded by the UK Department of the Environment, Food and Rural Affairs (DEFRA). The report is part of DEFRA's research into the contribution that greenhouse gas reporting makes to the UK achieving its climate change objectives. The report presents the results of an investigation into how financial institutions take account of environmental considerations in making investment decisions.

The report recommends reporting policies should be introduced requiring, at the minimum:

  • Companies to disclose their carbon emissions strategies and management programmes
  • Relevant information disclosures to be audited in the same way as are company financial reports
  • Financial institutions of all types to disclose the adjudged effect of taking environmental considerations into account on portfolio risk levels.

The Climate Disclosure Standards Board (CDSB) was formed at the 2007 annual meeting of the World Economic Forum in response to increasing demands for standardised reporting guidelines on the inclusion of climate change information in mainstream reports. One of the responses the CDSB intends is to develop its existing Climate Change Reporting Framework to further align with accounting models with which organisations and investors are already familiar. As quoted in the paper "It is difficult to comprehend something that is not in companies' accounting models".

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