Investor practices programme
Global Investor Coalition letter to Task Force on Climate-related Financial Disclosure
Three international investor organisations which together form the Global Investor Coalition on Climate Change and represent 304 long term investors with $30 trillion US dollars of assets under management have written an open letter to task force on climate-related financial disclosures members. In the letter the Institutional Investors Group on Climate Change (IIGCC, Europe), the Investor Network on Climate Risk (INCR, North America) and the Investors Group on Climate Change (IGCC, Australasia and New Zealand) set out recommendations for the scope of the work of the Task Force on Climate-related Financial Disclosures like:
• It is important that companies adopt a climate risk management and disclosure approach, which combines quantitative and narrative reporting about exposures and risk mitigation strategies. We suggest a 5-part framework covering central areas of climate risk, which could form the basis of a disclosure taxonomy for all industries. Scope I, II and where relevant Scope III emissions should be reported.
• Narrative reporting should have long timescale reflective of investment horizons for relevant sectors and the long-range nature of climate change. It should be forward-looking and risk-based.
• 2 degrees stress-testing in those sectors where climate change is expected to have a material impact will be necessary.
Considering the important role of asset owners (pension funds, insurance companies, endowments), which are the end of the investment chain, the Global Investor Coalition recommends that the TCFD appoint additional asset owner members when they expand their membership.
Progress made towards implementation of the task force recommendations should be reviewed annually.
Incorporating Derivatives and Hedge Funds into the NZIF: Consultation Responses