How well do you understand the TCFD Sustainability Framework? In this blog post, you will learn what TCFD means, why you should report according to the framework and how to apply it to your business.
What does TCFD mean?
Task Force On Climate-related Financial Disclosure (TCFD) is a framework to help organizations identify and mitigate their climate-related financial risks.
The purpose of the framework is to provide insight into how climate change will affect the financial outlook of the business. What distinguishes TCFD is that the framework is based on the effect of the climate on the company, rather than the company's effect on the climate.
Why should my company report under the TCFD?
TCFD can be used by all businesses, large and small. Companies that do not actively take climate change into account risk running into problems later on. The TCFD encourages businesses to work continuously to prevent future climate-related financial risks.
The purpose of the TCFD is to increase understanding of the financial risks and opportunities that climate change will pose to businesses. The framework helps companies identify, manage and disclose the financial impact of climate change on the organization. The guidelines include key elements such as strategy, metrics, targets, risk management and governance.
How to report under the TCFD?
1. Find out what other frameworks you use
A good start is to review which sustainability frameworks you already use. Perhaps you already report according to, for example, the EU taxonomy, GRI or Agenda 2030? If so, chances are you already comply with some of the TCFD guidelines. Start here to avoid duplication of efforts.
2. Decide which recommendations are relevant
Read through TCFD recommendations and decide which ones are relevant to your company. Factors such as the type of business you run and your size will influence which recommendations you should focus on.
3. Be transparent in reporting
Realize that you won't be able to meet all the criteria at once, that you don't have everything in place from the start is perfectly okay. The best thing is to be transparent and also report the points where you are lacking. TCFD is based on long-term climate work where there is plenty of room for development and improvement!
Want to know more about how to report under the TCFD and other sustainability frameworks? Stratsys digital sustainability management tools help companies create structure and compliance in their sustainability work.
Read more about Stratsys digital support for sustainability management.
