02 December 2021 (Singapore): Commenting on the release of Australia’s guidance on managing the financial risks of climate change for banks, insurers, and superannuation funds, CDP’s Managing Director for Asia Pacific Donald Chan said: “The release of these guidelines, aligned with the recommendations of the Task Force for Climate-related Financial Disclosures (TCFD), represent a major step forward for corporate climate action in Australia.
It is positive that the guidelines highlight the importance of target setting. Disclosure against targets enables institutions to effectively track their progress and demonstrate to stakeholders that they are meeting their commitments. For corporate action to be meaningful, institutions must set targets that are in line with science, using proven methodologies such as that developed by the Science Based Targets initiative (SBTi).
The addition of stronger guidance on disclosure with respect to scenario analysis is an extremely positive addition. CDP welcomes that the stringency of the scenario analysis guidance has increased since draft guidelines were released, moving from 2 °C scenarios to well below 2°C. However, we urge governments and regulators to ensure all guidance and regulation goes further and is aligned with a 1.5 °C future, as has been deemed to be necessary by scientists to avoid climate catastrophe
CDP is pleased to have engaged with the Australian Regulation Authority (APRA) on the development and strengthening of these guidelines. We are encouraged to see this final version is aligned with many CDP recommendations. While climate disclosure is yet to be mandated in Australia, the new guidance is sure to drive more robust disclosure from financial institutions across the country.”
ENDS
About CDP
CDP is a global non-profit that runs the world’s environmental disclosure system for companies, cities, states and regions. Founded in 2000 and working with more than 590 investors with over $110 trillion in assets, CDP pioneered using capital markets and corporate procurement to motivate companies to disclose their environmental impacts, and to reduce greenhouse gas emissions, safeguard water resources and protect forests. Over 14,000 organizations around the world disclosed data through CDP in 2021, including more than 13,000 companies worth over 64% of global market capitalization, and over 1,100 cities, states and regions. Fully TCFD aligned, CDP holds the largest environmental database in the world, and CDP scores are widely used to drive investment and procurement decisions towards a zero carbon, sustainable and resilient economy. CDP is a founding member of the Science Based Targets initiative, We Mean Business Coalition, The Investor Agenda and the Net Zero Asset Managers initiative. Visit cdp.net or follow us @CDP to find out more.