CDP Suggests Robust Climate Transition Plans Are Crucial
The Carbon Disclosure Project (CDP) announced collaborations with the Securities and Exchange Commission (SEC) of Thailand and the Italian Ministry of the Ecological Transition. CDP also published key takeaways from the CDP Europe Workshop 2022 on environmental reporting and climate change.
The key highlights of the aforementioned developments follow:
- CDP and SEC Thailand will collaborate throughout 2022 to raise awareness of and drive higher levels of environmental disclosures in Thailand, in line with the recommendations from the Task Force on Climate-related Financial Disclosures (TCFD). The collaboration with CDP, which runs the global TCFD-aligned environmental disclosure system, and the SEC will involve co-developing a program to improve the quantity and quality of environmental disclosures from corporates and financial institutions in Thailand and the provision of data and insights from CDP to the SEC and other policy actors to support the priorities laid out in the Sustainable Finance Initiatives for Thailand roadmap. It will also involve a series of practical workshops and reports for corporates and policy makers to drive greater alignment with TCFD-aligned disclosures in Thailand.
- CDP collaborated with the Italian Ministry of Ecological Transition and published a report “Ready, Set, Act,," which analyzes environmental trends among Italian companies, governmental bodies, cities, and regions on issues related to climate, forest, biodiversity, and water security. The report findings show that there was a significant increase of 42% in corporate transparency in 2021, including a 55% increase in companies reporting climate data, a 40% increase in forest data, 24% on water security, and 22% by cities. The report highlighted that, in 2021, 6 Italian companies and 2 Italian cities received the best "A" score for environmental performance through CDP while 40% of Italian companies and 22 local governments have set emissions reduction targets, with fast growth in science-based target-setting, particularly in energy-intensive sectors. The report further shows that there is a strong need to increase the availability of public data on cities and regions in the south, most affected by the climate crisis.
- The CDP Europe Workshop 2022 covered areas related to net-zero targets, EU Taxonomy, new biodiversity reporting, and climate transition planning. One key takeaway was that robust climate transition plans are a crucial part of a company's journey. Plans must be time-bound and clearly outline how an organization will pivot its existing assets, operations, and entire business model toward a trajectory that aligns with 1.5°C. However, much is to be done, as CDP analysis suggests only 1% of global businesses currently disclose against all 24 of the recommended indicators. CDP is also evolving to integrate the EU taxonomy and the updated European mandatory reporting requirements in its disclosure system. Another message that came out strongly was that businesses need to be ready, now, and disclosing through CDP enables companies to meet new regulatory rules and ensure that business is ready to lead.
Keywords: International, Thailand, Italy, EU, Banking, Securities, ESG, Climate Change Risk, Disclosures, TCFD, Sustainable Finance, Transition Risk, Reporting, SEC Thailand, UNFCCC, CDP
Credit analytics expert helping clients understand, develop, and implement credit models for origination, monitoring, and regulatory reporting.
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Previous ArticleBIS Bulletins Discuss DeFi Lending and Aspects of Crypto-Assets
FINMA Approves Merger of Credit Suisse and UBS
The Swiss Financial Market Supervisory Authority (FINMA) has approved the takeover of Credit Suisse by UBS.
BOE Sets Out Its Thinking on Regulatory Capital and Climate Risks
The Bank of England (BOE) published a working paper that aims to understand the climate-related disclosures of UK financial institutions.
OSFI Finalizes on Climate Risk Guideline, Issues Other Updates
The Office of the Superintendent of Financial Institutions (OSFI) is seeking comments, until May 31, 2023, on the draft guideline on culture and behavior risk, with final guideline expected by the end of 2023.
APRA Assesses Macro-Prudential Policy Settings, Issues Other Updates
The Australian Prudential Regulation Authority (APRA) published an information paper that assesses its macro-prudential policy settings aimed at promoting stability at a systemic level.
BIS Paper Examines Impact of Greenhouse Gas Emissions on Lending
BIS issued a paper that investigates the effect of the greenhouse gas, or GHG, emissions of firms on bank loans using bank–firm matched data of Japanese listed firms from 2006 to 2018.
HMT Mulls Alignment of Ring-Fencing and Resolution Regimes for Banks
The HM Treasury (HMT) is seeking evidence, until May 07, 2023, on practicalities of aligning the ring-fencing and the banking resolution regimes for banks.
MFSA Sets Out Supervisory Priorities, Issues Reporting Updates
The Malta Financial Services Authority (MFSA) outlined its supervisory priorities for 2023
German Regulators Issue Multiple Reporting Updates for Banks
Deutsche Bundesbank published the nationally deactivated validation rules for the German Commercial Code (HGB) users on the taxonomy 3.2, which became valid from December 31, 2022
BCBS Report Examines Impact of Basel III Framework for Banks
The Basel Committee on Banking Supervision (BCBS) published results of the Basel III monitoring exercise based on the June 30, 2022 data.
PRA Consults on Prudential Rules for "Simpler-Regime" Firms
Among the recent regulatory updates from UK authorities, a key development is the first-phase consultation, from the Prudential Regulation Authority (PRA), on simplifications to the prudential framework that would apply to the simpler-regime firms.