In April 2015, at the request of G20 Finance Ministers and Central Bank Governors, the Financial Stability Board (FSB) convened representatives of the private and public sector to review how the financial sector could take account of climate-related issues.
The conclusion was that financial markets need better, more comparable and complete information about climate change.
In response, the FSB established the Task Force on Climate-related Financial Disclosures (TCFD) in December 2015.
The TCFD’s objectives are to develop climate-related disclosure recommendations that:
- Provide information for investors so as to promote more informed investment, credit and insurance underwriting decisions;
- Enable stakeholders to understand the financial system’s exposure to climate-related risks particularly affecting organizations most likely to experience climate-related financial impacts from transition and physical risks;
- Complement, but do not add to, existing climate disclosure frameworks, so as to improve the quality and consistency of information disclosed;
- Are ambitious but practical for near term adoption.