The Financial Stability Board (FSB) announced today it is establishing an industry-led disclosure task force on climate-related financial risks under the chairmanship of Michael R. Bloomberg.
The Task Force on Climate-related Financial Disclosures (TCFD) will develop voluntary, consistent climate-related financial risk disclosures for use by companies in providing information to lenders, insurers, investors and other stakeholders.
Speaking at the COP21 Paris Climate Change Conference Mark Carney, FSB Chair, said “The FSB is asking the Task Force on Climate-related Financial Disclosures to make recommendations for consistent company disclosures that will help financial market participants understand their climate-related risks. Access to high quality financial information will allow market participants and policymakers to understand and better manage those risks, which are likely to grow with time. Michael’s experience working on climate change issues, his unparalleled track record of execution in a broad range of fields and his lifelong commitment to open and transparent financial markets make him the ideal leader for the Task Force.”
In response to this announcement, Mark Campanale, Carbon Tracker’s founder and executive director, said:
Carbon Tracker welcomes further steps to progress the Climate Disclosure Task Force. A key challenge the Task Force faces will be to identity and agree reliable, independent information on ‘carbon bubble’ and ‘stranded assets’ risks, to help market participants manage their transition to a low carbon economy. We remain ready to support this process.’
Jeremy Leggett, Carbon Tracker’s chairman, said:
Governor Carney warns of a threat to global capital markets from unconstrained future investment in carbon fuels. President Hollande warns of a threat to life on Earth. Accordingly, I view this new initiative as potentially the carbon equivalent to the cracking of the enigma code. With the provision of the information Mark Carney and Michael Bloomberg envisage – should the river of capital flowing dysfunctionally to carbon begin to be diverted – at minimum there will be far less devastation and far fewer people dead than would have been the case otherwise. At best, their initiative could be the key to the winning of the carbon war.