Sustainable Resilience Blog

The advent of investor-led sustainability frameworks provides companies with a method for incorporating climate change into their business plans by integrating strategy and climate scenario analysis into the financial risks identified by the company.  This approach is useful for both investors and financiers alike who are looking for robust data and insightful information that can support investment decisions.

The key investor-led sustainability frameworks are:

The Task Force on Climate-related Financial Disclosure (TCFD) is a G20 sponsored initiative that uses a set of recommendations to assist companies in better accounting for climate-related risks in their financial and mainstream disclosures. Many reporting frameworks are aligning to the sustainability provisions of TCFD.

The FTSE4Good Index is a series of ethical investment stock market indices launched in 2001 by the FTSE Group. A number of stock market indices are available, for example covering UK shares, US shares, European markets and Japan, with inclusion based on a range of corporate social responsibility criteria. FTSE4Good is a sustainability reporting framework that is designed to measure the performance of companies with strong Environmental Social Governance (ESG) practices. Companies are required to provide evidence about their ESG practices.

The Sustainability Accounting Standards Board (SASB) publishes 77 industry-specific standards to help businesses identify, manage and report on sustainability topics that matter most to their investors. The industry-specific reporting standards allow for benchmarking and comparison for businesses around the world.

SASB standards draw on accounting principles to align with US financial reporting. The SASB sustainability framework, used by 50 SASB Alliance companies, is focused on industry-specific reporting standards and focused on financially material issues.