Treasury taskforce has revealed its “gold standard” guidelines for companies to report their plans to tackle climate change.
The Transition Plan Taskforce (TPT), which includes members like Aviva, London Stock Exchange Group, NatWest and Unilever, published its final best practice “disclosure framework” for corporate transition plans on Monday.
The taskforce said the guidelines set out the basis for companies to share credible plans as part of their annual reporting on forward business strategy.
They said firms should take a strategic and rounded approach to tackling their impact and explain how they will meet climate targets, manage climate-related risks and contribute to achieving net zero.
This includes outlining interim milestones and detailed steps to change business models as well as investment.
Plans should also address how workers will be supported and the upskilling or reskilling needed, the taskforce said.
Under our Cop26 leadership the Government set out that the UK would move towards making the publication of transition plans mandatory as part of our commitment to becoming the world’s first net zero-aligned financial centre
Alongside the guidelines, the TPT has also released other material including specific guidance for 40 sectors, technical mappings and comparisons with other well-known reporting frameworks, an implementation guide and legal considerations for companies preparing reports.
The Treasury launched the TPT last year with a pledge that large businesses in high-emitting sectors would be subjected to new net-zero disclosure requirements from 2023.
The final documents published on Monday build on the global baseline of disclosure standards developed by the International Sustainability Standards Board and draw on the work of the Glasgow Financial Alliance for Net Zero.
The taskforce said the framework will support the creation of consistent, comparable company reports and reduce the level of complexity faced by firms.
Backing up net zero ambitions with high quality and clear transition plans is crucial if we are to collectively deliver net zero
Baroness Penn, Treasury Lords minister and TFT co-chairwoman, said: “Under our Cop26 leadership the Government set out that the UK would move towards making the publication of transition plans mandatory as part of our commitment to becoming the world’s first net zero-aligned financial centre.
“Launched only in April 2022, the Transition Plan Taskforce has now delivered on its core mandate to develop the gold standard for private sector climate transition plans.
“The transparency and accountability offered by transition plans is vital to the fundamental shift in business and finance that is required for the economy-wide transition to net zero and a climate resilient future.“
Amanda Blanc, group chief executive of Aviva and TPT co-chairwoman, said: “It’s great to see more and more companies announcing their net zero ambitions, but these are of little use if there’s no action or accountability.”
“Backing up net zero ambitions with high quality and clear transition plans is crucial if we are to collectively deliver net zero.
“The TPT Disclosure Framework will help businesses understand just what makes a climate transition plan robust and credible.”