What is the TCFD? Flashcards
What are the four core elements of the TCFD recommendations?
Governance, strategy, risk management, and metrics and targets
Describe the core element of governance
Organizations should disclose how the board oversees climate-related issues, management’s role, and how decisions are made
Describe the core element of strategy
Organizations should disclose the impacts of climate-related risks and opportunities on their strategies and financial planning
Describe the core element of risk management
Organizations should disclose how climate-related risks are assessed and managed
Describe the core element of metrics and targets
Organizations should disclose the metrics and targets used to manage climate-related risks and opportunities
What are the recommend governance disclosures?
Disclose the organization’s governance around climate-related risks and opportunities. Including the board’s oversight and management’s role.
What are the recommend strategy disclosures?
Disclose the actual and potential impacts of climate-related risks and opportunities on strategy and financial planning. Describe the short, medium, and long term. Describe the resilience of the strategy taking into consideration different climate scenarios, especially 2-degrees-C or lower scenario.
What are the recommended risk management disclosures?
Disclose how the organization identifies, assesses, and manages climate-related risks. Describe the processes therefore. Describe how those processes are integrated into the organization’s overall approach to risk management.
What are the recommended metrics and targets disclosures?
Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities with material info. Disclose the Scopes 1, 2, and 3, GHG emissions. Describe the targets used.
What are the seven principles of effective disclosure?
Relevant information. Specific and complete. Clear, balanced, and understandable. Consistent over time. Comparable among similar companies. Reliable, verifiable, and objective. Provided on a timely basis.
In scenario analysis, what is a scenario?
A scenario describes a path of development leading to a particular outcome. Scenarios are hypotheticals, not forecasts, predictions, or sensitivity analyses.
