On the go: The Taskforce on Climate-related Financial Disclosures is to launch a consultation on best practice for measuring investors’ alignment with a “net zero” future later this month.
Mark Carney, UN special envoy for climate action and finance, announced at a Make My Money Matter summit that TCFD will also issue further guidance on this “critical tool” just before COP26.
During his speech, he explained that pension funds have a key role in ensuring a successful transition to net zero, and urged action from other global policymakers.
Carney said: “The scale of stranded assets is only starting to be appreciated — and not thinking about terminal value, in a world on the road to net zero, could well prove terminal for some portfolios."
He continued: "Achieving net zero requires a whole-economy transition. That means every company, bank, insurer and investor will have to adjust their business models, and in the process it's turning an existential risk into what I’d argue is the greatest commercial opportunity of our time."
He said the UK was leading the way on climate-driven investment regulation, with TCFD disclosures to be compulsory by 2025 for all companies, and that other countries were now also following suit.
“International standard-setters are taking action, particularly the [International Financial Reporting Standards], whose reporting standards will reach into 140 countries,'' said Carney.
Carney concluded by saying that investors, including pension funds, need to provide their members with answers on whether their money is invested in line with their values, and to understand what more can be done.
