As the impacts of climate change become increasingly evident, the global economy faces significant challenges, with trillions of dollars at stake. The "Climate Risk Disclosures" eBook highlights the increasing importance of transparent, consistent, and comparable climate-related disclosures for companies globally. This shift towards more rigorous reporting is driven by the need for stakeholders to understand a company's exposure to climate risk and how it manages these risks.
A New Era of Climate Regulation
In recent years, there has been a significant increase in the number of regulatory frameworks and standards aimed at improving climate-related disclosures. Key among these are the Task Force on Climate-related Financial Disclosures (TCFD), the European Union's Corporate Sustainability Reporting Directive (CSRD), and the forthcoming regulations from the U.S. Securities and Exchange Commission (SEC). These frameworks emphasize the importance of reporting on both the physical risks posed by climate change—such as extreme weather events and long-term environmental changes—and the opportunities for businesses to align with sustainable practices.
These frameworks make it clear that companies must not only understand their impact on the climate but also assess and disclose their exposure to climate risks. This is crucial for informing investors, regulators, and other stakeholders, enabling better risk management and investment decisions.
The Global Push for Transparency
Major and emerging economies, including the EU, the U.S., India, New Zealand, the UK, China, Egypt, Chile, the Philippines, and Taiwan, have already mandated some form of climate-related reporting. In many cases, reporting on physical climate risks is compulsory for specific companies, especially those in regulated industries like finance. Early compliance offers companies a competitive advantage, demonstrating foresight and resilience to stakeholders.
The handbook provides an overview of the most recent climate risk regulatory disclosures, focusing on the evolving requirements in the EU and the U.S., and the international standards set by the TCFD, now overseen by the International Sustainability Standards Board (ISSB).
EarthScan: A Tool to Help You Act on Climate Risk
At the forefront of helping companies navigate these complex regulatory landscapes is EarthScan—a self-serve platform designed to analyze, report, and act on climate risk. EarthScan combines world-leading climate science, data modeling, and machine learning to provide asset-level insights into acute and chronic risks, such as flooding, drought, wildfires, and extreme temperatures.
EarthScan offers a streamlined process: users can upload asset locations or select from pre-mapped assets, and within minutes, gain insights into their exposure to various climate risks. EarthScan supports the generation of reports aligned with TCFD, CSRD, and IFRS standards, making it an invaluable tool for companies needing to comply with regulatory disclosures.
We have worked with different companies, including a U.S. fund managing a $12 billion portfolio focused on infrastructure and real estate, and a UK fund with a $6 billion portfolio in energy and renewables. Both used EarthScan to receive rapid, asset-level insights into various climate perils, highlighting the platform's utility in providing actionable data.
Ready to dive deeper?
As the pressure to meet these regulatory requirements grows, companies worldwide will increasingly rely on tools like EarthScan to ensure compliance and strategic foresight. The comprehensive insights provided by EarthScan not only help mitigate risks but also position companies to capitalize on the opportunities presented by a more sustainable economy.
To explore these insights and equip your business with the tools needed to navigate this critical landscape, download the full eBook here.
