LIVE: What to expect from the evolving climate disclosure landscape
Oct 27, 2023
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Emily Pierce, Chief Global Policy Officer at Persefoni, discusses the US regulatory outlook and the pending climate disclosure rule from the SEC. Neil Stewart talks about global climate disclosures and the formation of the International Sustainability Standards Board. Tim Mohin discusses challenges companies face in navigating the climate disclosure landscape. Val Smith, Chief Sustainability Officer at Citigroup, highlights the evolving investor expectations around sustainability reporting.
Comprehensive carbon emissions disclosure, including Scope 3 emissions, is crucial for assessing transition risk in companies.
The International Sustainability Standards Board (ISSB) is collaborating with other organizations to develop globally accepted standards for climate-related financial disclosures.
Deep dives
The Evolving Climate Disclosure Landscape
The podcast episode discusses the fast-evolving climate disclosure landscape and highlights interviews conducted during a live event in New York. The guests include experts from the US Securities and Exchange Commission, the International Sustainability Standards Board (ISSB), the Global Reporting Initiative (GRI), and Citigroup. The episode emphasizes the importance of comprehensive carbon emissions disclosure, including Scope 3 emissions, as an indicator of transition risk for companies. It also highlights the global movement to enhance and standardize climate-related disclosures, with the ISSB's newly issued sustainability disclosure standards gaining endorsement from the Financial Stability Board and the International Organization of Securities Commissions (IOSCO). Furthermore, the episode explores the challenges and confusion faced by companies in response to evolving regulatory requirements, the importance of using sustainability data for driving positive change, and the increased involvement of banks and financial institutions in sustainability initiatives.
Understanding the US Regulatory Landscape
The episode delves into the US regulatory landscape surrounding climate disclosure. It emphasizes the Securities and Exchange Commission's (SEC) proposed climate disclosure rule, particularly in relation to Scope 3 emissions. The pending rule would require large companies to disclose Scope 3 emissions if they are material to their operations and financial performance. It also highlights California's legislation that mandates greenhouse gas emissions reporting, including Scope 3 emissions, for companies operating in the state. The discussion underscores the need for comprehensive reporting and understanding of climate risk as financial risk, both at the SEC level and within the broader global context.
Enhancing Global Standards and Building Consistency
The episode focuses on the international regulation and standards landscape for climate-related financial disclosures. The discussion centers around the work of the International Sustainability Standards Board (ISSB) in developing globally accepted standards. It highlights the ISSB's collaboration with other well-known standards organizations such as the Sustainability Accounting Standards Board (SASB) and the task force on climate-related financial disclosures (TCFD) to create robust and investor-focused standards. The episode also emphasizes the endorsement of the ISSB standards by the International Organization of Securities Commissions (IOSCO) and jurisdictions worldwide. It underscores the importance of consistent application and a common digital taxonomy for effective data integrity and reporting across jurisdictions.
Challenges and Opportunities for Companies
The podcast episode explores the challenges and opportunities faced by companies in relation to climate disclosure. It highlights the confusion and fear among companies due to evolving standards and regulations. The discussion emphasizes the increasing demand from investors for robust sustainability disclosures and the need for companies to integrate sustainability reporting into financial disclosure processes. Furthermore, the episode underscores the importance of not just complying with reporting requirements, but also effectively utilizing the data for informed decision-making, identifying opportunities for decarbonization, and driving positive change. The role of financial institutions, such as Citigroup, in supporting sustainability goals and the optimism surrounding the future of sustainable investing and climate action are also discussed.
Last week, we took the ESG Insider podcast on the road for an in-person event in New York City about the evolving climate disclosure landscape. In this episode, we bring you highlights from our interviews at this ESG Insider Live event:
Emily Pierce, Chief Global Policy Officer at climate software firm Persefoni, discusses the US regulatory outlook. She talks about what to expect from the pending climate disclosure rule from the US Securities and Exchange Commission — including how the SEC will approach Scope 3 emissions in the final rule.
Neil Stewart talks to us about the global landscape for climate disclosures. Neil is the New York-based Director of Corporate Outreach for the IFRS Foundation, which formed the International Sustainability Standards Board (ISSB).
Tim Mohin tells us about the challenges companies face in getting to grips with this landscape. Tim is the former chief executive of sustainability standards organization the Global Reporting Initiative (GRI), and a partner and director in climate and sustainability at the Boston Consulting Group (BCG).
Val Smith, Chief Sustainability Officer at big bank Citigroup, provides a financial institution’s perspective. She describes how investor expectations around sustainability reporting have evolved. Tune into next week’s episode to hear more of our interview with Val.
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