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Climate-related financial disclosure

About the topic

The impacts of climate change on organisations are yet to be fully understood. Companies and investors are grappling with quantifying the risks, as well as the opportunities presented by climate change. If we are to realise the goal of making both individual companies and the overall financial system more resilient and sustainable, it is not only important for organisations to have a thorough understanding of what climate change means for their own business models, but what implications it has for the broader financial system.

The Task-Force on Climate-Related Financial Disclosures
Globally, the Task Force on Climate-Related Financial Disclosures (TCFD) is fast becoming a widely adopted framework that companies can use to integrate climate change risks within their businesses. The purpose of the TCFD recommendations is to guide the financial sector in its incorporation of climate-related issues in its decision-making. A key objective of the TCFD is to develop recommendations for more effective climate-related disclosures that will assist organisations in their understanding of climate-related risks, and to provide guidance on how organisations can implement measures to protect them from such risks.

Publications

Climate-related financial disclosure: Aligning South Africa to global best practice

In July 2020, the UK Partnering for Accelerated Climate Transitions programme (UK PACT) launched the South Africa-UK PACT country programme to support action on just transition pathways and a low-carbon economic recovery. One of the ten projects that was awarded UK PACT funding focuses on aligning South Africa’s climate-related financial disclosure to global best practice. This special edition Atleha-edu publication provides an overview of climate risk and investment, with specific attention being paid to the findings of the project as it relates to climate risk and corporate reporting in South Africa.

Short articles

Role of the finance sector in contributing to Climate Resilience

This article provides an overview of experts’ discussion on agricultural investing/ finance that can mitigate climate change and enhance agricultural practices by learning from the practical actions initiated by Boschendal Wine Estate.

An introduction to climate risk

Climate change has the potential to cause many disruptions to the financial system.
This article provides an overview of the climate risk exposure faced by companies, investors and other stakeholders.

Climate risk and scenario analysis

According to the Task Force on Climate-Related Financial Disclosures (TCFD), it is important for organisations to develop forward-looking scenario-based assessments to explore and understand climate change-related physical and transition risks and opportunities – and how these might plausibly impact the business over time.

Climate risk and investment

In order to meet South Africa’s commitments to the Paris Agreement on Climate Change, the financial sector will need to play its part. There are existing governance frameworks in place – aimed at supporting the investment community in improving its climate-related disclosure levels – but challenges and inhibitors to climate finance in South Africa remain.

Investment opportunities presented by the transition to low-carbon economies

Despite the growing evidence of increasing environmental, economic and social risks due to climate change, the climate investment opportunity presented at the same time is often overlooked. The transition to low-carbon economies provides South Africa with the opportunity to leverage our sophisticated and deep financial markets to serve as a gateway for climate finance for the rest of the continent, which is currently struggling to access its fair share of climate finance.

Other content

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