G7 backs mandatory climate disclosures
The Group of Seven (G7) Finance Ministers and Central Bank Governors have issued a communiqué calling for the introduction of mandatory climate-related disclosures and endorsing international initiatives, among other concrete actions to address today’s historic challenges.
The communiqué states: “We support moving towards mandatory climate-related financial disclosures that provide consistent and decision-useful information for market participants and that are based on the Task Force on Climate-related Financial Disclosures (TCFD) framework, in line with domestic regulatory frameworks. Investors need high quality, comparable and reliable information on climate risks.”
“We therefore agree on the need for a baseline global reporting standard for sustainability, which jurisdictions can further supplement,” it continues, endorsing the work led by the International Financial Reporting Standards (IFRS) Foundation and encouraging final plans for the International Sustainability Standards Board (ISSB) ahead of COP26.
In apparent support of double materiality, the communiqué recognises “the growing demand for more information on the impact that firms have on the climate and the environment” and the many existing efforts in this sphere, with delegates promising to work closely together and with international partners toward global consistency.
With yet more backing at the highest level, the momentum behind international sustainability reporting standards could hardly be greater.