TCFD WORKSHOP
Session 5 – Metrics and Targets

February 2022

TCFD Series of Workshops
Session1

Fundamentals and Overview of TCFD

2

TCFD Recommendation:
Governance3

TCFD Recommendation:
Strategy

4

TCFD Recommendation:
Risk Management

5

TCFD Recommendation:
Metrics and Targets

This session

2

Contents
Introduction

4

Overview of the Metrics and Targets recommendation

10

Cross-industry, climate-related metric categories

20

Climate-related targets

24

Q&A

31

Appendix

32

Examples of climate-related risks and opportunities, and potential financial impacts

33

Drill down on cross-industry, climate-related metric categories

36

Supplemental guidance for the financial sector and non-financial groups

47

Introduction

4

Introduction to the Metrics and Targets Recommendation
In this session, we will drill down on the Metrics and Targets recommendation
Core Elements of the TCFD Recommendations
Governance

Governance

Strategy
RiskManagement

Metrics
and Targets

Disclose the company’s governance around climate-related risks andopportunities
Strategy
Disclose the actual and potential impacts of climate-related risks andopportunities on the company’s businesses, strategy, and financial
planning
Risk Management
Disclose the processes used by the company to identify, assess, andmanage climate-related risks
Metrics and Targets
Disclose the metrics and targets used to assess and manage relevant
climate-related risks and opportunities

Note: The Task Force uses the term “companies” to refer to entities with public debt or equity as well as asset managers and asset owners, including
public- and private-sector pension plans, endowments, and foundations.
Source: TCFD, Recommendations of the Task Force on Climate-related Financial Disclosures, 20175

Introduction to the Metrics and Targets Recommendation (cont.)
The Task Force’s Metrics and Targets recommendation is supported by three recommended
disclosures

Governance

Strategy

Risk Management

Metrics and Targets

Disclose the company’s governancearound climate-related risks andopportunities.

Disclose the actual and potential
impacts of climate-related risks andopportunities on the company’sbusinesses, strategy, and financial
planning where such information ismaterial.

Disclose how the company
identifies, assesses, and manages
climate-related risks.

Disclose the metrics and targets
used to assess and manage
relevant climate-related risks andopportunities where suchinformation is material.

Recommended Disclosures

Recommended Disclosures

Recommended Disclosures

Recommended Disclosuresa) Describe the board’s oversight ofa) Describe the climate-related risks
and opportunities the company
has identified over the short,medium, and long term.

a) Describe the company’s
processes for identifying andassessing climate-related risks.

a) Disclose the metrics used by thecompany to assess climaterelated risks and opportunities inline with its strategy and risk
management process.

b) Describe management’s role inb) Describe the impact of climaterelated risks and opportunities
on the company’s businesses,
strategy, and financial planning.

b) Describe the company’s
processes for managing climaterelated risks.

b) Disclose Scope 1, Scope 2, and, if
appropriate, Scope 3 greenhousegas (GHG) emissions, and therelated risks.

c) Describe the resilience of thecompany’s strategy, taking into
consideration different climaterelated scenarios, including a 2°C
or lower scenario.

c) Describe how processes for
identifying, assessing, andmanaging climate-related risks
are integrated into thecompany’s overall risk
management.

c) Describe the targets used by thecompany to manage climaterelated risks and opportunities
and performance against targets.

climate-related risks andopportunities.

assessing and managing climaterelated risks and opportunities.

Source: TCFD, Recommendations of the Task Force on Climate-related Financial Disclosures, 20176

Introduction to the Metrics and Targets Recommendation (cont.)
Various TCFD publications offer guidance on the Metrics and Targets recommendation
Final
Recommendations
and Recommended
Disclosures

Legend:Provides details on the following:• Context and background on the need for climate-related
financial disclosures

Publication expanding on the Metrics
and Targets recommendation• The Task Force’s remit from the Financial Stability Board
2017 Report

Implementation
Guidance• TCFD general framework, including recommendations
and recommended disclosures
Provides guidance on the application of the recommendations
as well as implementation guidance for the following:• All sectors• Four financial industries

2021 Implementation
Guidance (Annex)• Four groups of non-financial companies the Task Forceconsiders more likely to be affected financially than others
given their exposure to certain transition and physical risks

Additional
Supporting Materials

2017 Scenario Analysis
Technical Supplement

2020 Guidance on Risk
Management Integration
and Disclosure

2020 Guidance on
Scenario Analysis for NonFinancial Companies

2021 Guidance on
Metrics, Targets, andTransition Plans

Visit fsb-tcfd.org/publications to access all of the Task Force’s reports, guidance, and other materials.

7

Disclosure Varies Across Recommendations

More than 30% of companies assessed in 2020 disclosed on each of the Metrics and Targets
recommended disclosures, with climate-related targets having the lowest rate of disclosure at 34%
TCFD-Aligned Disclosure by Year, for Each Recommended Disclosure
Recommendation
Governance

Strategy

Risk Management

Recommended Disclosure% Point Change % of Companies Disclosing Information’18–’20
Aligned with TCFD Recommended Disclosuresa) Board Oversight16b) Management's Role

9a) Climate-Related Risks andOpportunities

14b) Impact on company

13c) Resilience of Strategy

8a) Risk Identification andAssessment Processesb) Risk Management
Processesc) Integration into Overall
Risk Managementa) Climate-Related Metrics

9%
9%

13%

26%

7%

14%
10%

30%

20%

10

c) Climate-Related Targets

13

52%

39%

30%

17%

29%

17%

27%
34%

10

b) Scope 1, Scope 2, andMetrics and Targets
Scope 3 GHG Emissions

42%

13%
16%

15

FY 2020

18%
38%

5%

FY 2019

25%

11%

14

17

FY 2018

27%
21%

24%

31%

40%

44%

37%
34%

Note: Results are based on the Task Force’s artificial intelligence analysis of 1,651 public companies.
Source: TCFD, 2021 Status Report, 2021

8

Importance of the Metrics and Targets Recommendation

Disclosing information in line with the Metrics and Targets recommendation allows investors andother stakeholders to better assess the organization’s potential risk-adjusted returns, general
exposure to climate-related issues, and progress in managing or adapting to those issues.
Providing Decision Useful Information to Investors and Other Users
Six of the top ten most “decision useful” types of information companies can disclose fall under the Metrics andTargets recommendation.1
Recommended Disclosure Disclosure Element*

Rank

Strategy b)

How climate-related issues have affected business and strategy

1

Metrics and Targets a)

Key metrics on climate-related issues for most recent period and historical periods

2Strategy a)

The material climate-related issues identified for each sector and geography

3

Metrics and Targets b)

Scope 1 GHG emissions for the most recent period and historical periods

4

Metrics and Targets c)

Climate-related targets related to GHG emissions

5

Strategy a)

The material climate-related issues identified

6

Metrics and Targets b)

Scope 2 GHG emissions for the most recent period and historical periods

7

Metrics and Targets c)

The timeframes over which climate-related targets apply

8

Metrics and Targets c)

Key performance indicators used to assess progress against climate-related targets
Board consideration of climate-related issues for major capital expenditures, acquisitions, anddivestitures9

Governance a)

10* These disclosure elements are segments of the guidance under each recommended disclosure. They do not encompass all of theinformation conveyed in each recommended disclosure.
1. These findings are based on a survey in which users were asked to rate the usefulness of specific disclosure elements associated with the 11
recommended disclosures when making financial decisions.
Source: TCFD, 2020 Status Report, 20209

Overview of the Metrics and Targets
recommendation

10Structure of the Metrics and Targets Recommendation Overview
SectionThe overview of each of the three recommended disclosures under the Metrics and Targets
recommendation will follow the structure provided belowi.

Describing the guidance for all sectors
associated with the recommended disclosure

ii. Drilling down into specific elements of therecommended disclosureiii. Providing examples of reporting that alignwith the recommended disclosure

11

Recommended Disclosure Metrics and Targets a)

The first recommended disclosure under the Metrics and Targets recommendation — Metrics andTargets a) — asks companies to disclose the metrics used by the company to assess climate-relatedrisks and opportunities
Metrics and Targets

Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where suchinformation is material.
All Sectors
Recommended
disclosure a)
Disclose the metrics
used by the company
to assess climaterelated risks andopportunities in linewith its strategy andrisk management
process

Companies should provide the key metrics used to measure and manage climate-related risks and opportunities, as
described in Tables A1.1 and A1.2 of the 2021 Annex (see Appendix), as well as metrics consistent with the crossindustry, climate-related metric categories described in Table A2.1 of the 2021 Annex (see Appendix). Companies
should consider including metrics on climate-related risks associated with water, energy, land use, and waste
management where relevant and applicable.
Where climate-related issues are material, companies should consider describing whether and how related
performance metrics are incorporated into remuneration policies.
Where relevant, companies should provide their internal carbon prices as well as climate-related opportunity metrics
such as revenue from products and services designed for a low-carbon economy.
Metrics should be provided for historical periods to allow for trend analysis. Where appropriate, companies should
consider providing forward-looking metrics for the cross-industry, climate-related metric categories described inTable A2.1 of the 2021 Annex (see Appendix), consistent with their business or strategic planning time horizons. In
addition, where not apparent, companies should provide a description of the methodologies used to calculate or
estimate climate-related metrics.

Note: For readability, we removed footnote references from these excerpts. Please see the annex referenced below for more information.
Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

12

Metrics and Targets a): Effective Disclosure

In its 2021 guidance, the Task Force highlighted several considerations for disclosing climate-related
metrics
Companies Should Consider Disclosing the Following, where Relevant:• Types of measurements used, including whether information comes from direct measurements,
estimates, proxy indicators, or financial and management accounting processes.
• Methodologies and definitions used, including the scope of application, data sources, criticalfactors or parameters, assumptions, and limitations of the methodology.
• Trend data to allow for consideration of how metrics have changed in absolute and relative
amounts over time, including whether acquisitions, divestments, or policies have affected results.
• How results are connected with business units, company strategy, and financial performance andposition. When relevant, companies should consider disaggregating information by categories suchas geographic area, business unit, asset type, and upstream and downstream activities.
• How value chains will be affected over time by climate-related transition and physical risks,
including life cycle GHG emissions reporting.
• Reconciliation with financial accounting standards, if needed. If climate-related metrics arepresented in financial terms, disclosures should clarify how such metrics reconcile with financial
accounting standards and explain any differences.

Source: TCFD, Guidance on Metrics, Targets, and Transition Plans, 2021

13

Example of Disclosure for Metrics and Targets a)

Disclose the metrics used by the company to assess climate-related risks and opportunities in linewith its strategy and risk management process
Example Disclosure: Standard Bank Group (Banks)
TCFD alignment: This example
shows a metric Standard Bank
Group reported to reflect the
impact of climate-relatedrisks in its credit portfolio. The
bank’s report notes the data
represent an aggregation of
sector exposures based on
current data classification
structures and expects that as
the methodology forcalculating climate-related
indicators and metrics
evolves, the bank’s capacity toreport more granularconcentrations will improve.

[…]

[…]

Source: Standard Bank Group, ESG Report 2020, p. 72
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

14

Metrics and Targets b)

Metrics and Targets b) asks companies to disclose Scope 1, Scope 2, and, if appropriate, Scope 3
greenhouse gas (GHG) emissions
Metrics and Targets

Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where suchinformation is material.
All Sectors
Recommended
disclosure b)
Disclose Scope 1,
Scope 2, and, if
appropriate, Scope 3
greenhouse gas(GHG) emissions, andthe related risks

Companies should provide their Scope 1 and Scope 2 GHG emissions independent of a materiality assessment, and, if
appropriate, Scope 3 GHG emissions and the related risks. All companies should consider disclosing Scope 3 GHG
emissions.
GHG emissions should be calculated in line with the GHG Protocol methodology to allow for aggregation andcomparability across companies and jurisdictions. As appropriate, companies should consider providing related,
generally accepted industry-specific GHG efficiency ratios.
GHG emissions and associated metrics should be provided for historical periods to allow for trend analysis. In addition,
where not apparent, companies should provide a description of the methodologies used to calculate or estimate themetrics.

Note: For readability, we removed footnote references from these excerpts. Please see the annex referenced below for more information.
Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

15

Example of Disclosure for Metrics and Targets b)

Disclose Scope 1, Scope 2, and, if appropriate, Scope 3 greenhouse gas (GHG) emissions, and therelated risks
Example Disclosure: Maersk (Transportation)
TCFD alignment: thefollowing example describes
Maersk’s Scope 1, Scope 2,
and Scope 3 greenhouse gas
emissions, represented ascarbon dioxide equivalents,
as well as sources of primaryemissions and estimates ofmaterial Scope 3 emissions
categories.

Source: Maersk, 2020 Sustainability Report, 2020
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

16

Metrics and Targets c)

Metrics and Targets c) asks companies to disclose the targets used by the company to manage
climate-related risks and opportunities
Metrics and Targets

Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where suchinformation is material.
All Sectors
Recommended
disclosure c)
Describe the targets
used by the company
to manage climaterelated risks andopportunities andperformance against
targets

Companies should describe their key climate-related targets such as those related to GHG emissions, water usage,
energy usage, etc., in line with the cross-industry, climate-related metric categories in Table A2.1 of the 2021 Annex(see Appendix), where relevant, and in line with anticipated regulatory requirements or market constraints or othergoals. Other goals may include efficiency or financial goals, financial loss tolerances, avoided GHG emissions throughthe entire product life cycle, or net revenue goals for products and services designed for a low-carbon economy.
In describing their targets, companies should consider including the following:• whether the target is absolute or intensity based;• time frames over which the target applies;• base year from which progress is measured; and• key performance indicators used to assess progress against targets.
Companies disclosing medium-term or long-term targets should also disclose associated interim targets in aggregate
or by business line, where available.
Where not apparent, companies should provide a description of the methodologies used to calculate targets andmeasures.

Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

17

Example of Disclosure for Metrics and Targets c)

Describe the targets used by the company to manage climate-related risks and opportunities andperformance against targets
Example Disclosure: Japan Airlines (JAL) Group (Transportation)
TCFD alignment: the following
example describes Japan Airlines’
CO2 historical emissions andforward-looking reduction targets.
The company’s report noted thesetargets are planned to be achieved
through the use of climate-related
opportunities, such as upgrading tofuel-efficient aircraft, supporting thedevelopment and use of sustainableaviation fuel (SAF), reducing fuelconsumption, as well as engaging inemission trading.
Japan Airlines’ report also included
interim targets and specificinitiatives supporting these targets,
as well as quantified expenditure
deployed toward climate-related
opportunities (investment in SAF).

Source: Japan Airlines ( JAL) Group, 2020 Sustainability Report, p. 45
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

18

Discussion questions• Does your company disclose climate-related
metrics or targets?
• Which metric(s) does your company find themost useful to manage your risks?

19

Cross-industry, climate-related metriccategories

20

Characteristics of Effective Climate-Related Metrics

In its guidance issued in 2021, the Task Force identified a set of characteristics for climate-related
metrics to meet the Task Force’s fundamental principles for effective disclosure.

Decision-Useful. Relevant to the organization’s risks and opportunities and show how the organization
manages such risks and opportunities as part of its governance, strategy, and risk management processes.

Clear and Understandable. Presented in a manner that aids understanding. Provide context aroundsuch points as management’s thinking in terms of goal setting, internal process management, andcommunication objectives. Supported by contextual and supporting narrative information on items such asorganizational boundaries, governance, methodologies, and basis of preparation.

Reliable, Verifiable, and Objective. Free from bias and value judgment so that they yield an objective
disclosure of performance that users can leverage regardless of their worldview or outlook

Consistent Over Time.
• Current – Current period data, outlining most recent reporting period and covering the same period as the••current period in the organization’s financial filings
Historical Data – for the period(s) prior to the current period, covering at a minimum the same period asin the organization’s financial filings
Forward-Looking – Future period data, covering short-, medium-, and long-term time horizons

Source: TCFD, Guidance on Metrics, Targets, and Transition Plans, 2021

21

Cross-Industry, Climate-Related Metric Categories

The Task Force also identified climate-related metric categories that all companies should disclose,
where data and methodologies allow
Cross-Industry, Climate-Related Metric Categories and Examples
The Task Force defined metric categories rather than specific metrics, recognizing companies may define
relevant metrics for their respective industries differently for a given category.
Metric Category

Description

Examples

GHG Emissions1

Absolute Scope 1, Scope2, and Scope 3; emissions
intensity

•
•
•
•
•

Absolute Scope 1, Scope 2, and Scope 3 GHG emissions
Financed emissions by asset class
Weighted average carbon intensity
GHG emissions per MWh of electricity produced
Gross global Scope 1 GHG emissions covered under emissions-limiting regulations

Transition Risks

Amount and extent ofassets or businessactivities vulnerable totransition risks

•
•
•
•

Volume of real estate collaterals highly exposed to transition risk
Concentration of credit exposure to carbon-related assets
Percent of revenue from coal mining
Percent of revenue passenger kilometers not covered by Carbon Offsetting and Reduction
Scheme for International Aviation (CORSIA)

Physical Risks

Amount and extent ofassets or businessactivities vulnerable tophysical risks• Number and value of mortgage loans in 100-year flood zones• Wastewater treatment capacity located in 100-year flood zones• Revenue associated with water withdrawn and consumed in regions of high or extremely
high baseline water stress• Proportion of property, infrastructure, or other alternative asset portfolios in an area
subject to flooding, heat stress, or water stress• Proportion of real assets exposed to 1:100 or 1:200 climate-related hazards

1. The Task Force believes all companies should disclose absolute Scope 1 and Scope 2 GHG emissions independent of a materiality assessment. The
disclosure of Scope 3 GHG emissions is subject to a materiality assessment; however, the Task Force encourages companies to disclose such emissions.
Source: TCFD, Guidance on Metrics, Targets, and Transition Plans, 2021

22

Cross-Industry, Climate-Related Metric Categories (continued)

The Task Force also identified climate-related metric categories that all companies should disclose,
where data and methodologies allow
Cross-Industry, Climate-Related Metric Categories and Examples
Metric Category

Description

ExamplesClimate-Related
Opportunities

Proportion of revenue, assets, orother business activities aligned withclimate-related opportunities• Net premiums written related to energy efficiency and low-carbon technology• Number of (1) zero-emissions vehicles (ZEV), (2) hybrid vehicles, and (3) plugin hybrid vehicles sold• Revenues from products or services that support the transition to a lowcarbon economy• Proportion of homes delivered certified to a third-party, multiattribute green
building standard

Capital
Deployment

Amount of capital expenditure,
financing, or investment deployed
toward climate-related risks andopportunities• Percentage of annual revenue invested in R&D of low-carbon
products/services• Investment in climate adaptation measures (e.g., soil health, irrigation,technology)

Internal Carbon
PricesPrice on each ton of GHG emissions
used internally by a company• Internal carbon price• Shadow carbon price, by geography

Remuneration

Proportion of executive management
remuneration linked to climate
considerations• Portion of employee’s annual discretionary bonus linked to investments inclimate-related products• Weighting of climate goals on long-term incentive• Scorecards for Executive Directors• Weighting of performance against operational emissions’ targets forremuneration scorecard

Note: More disclosure examples can be found in the Appendix.
Source: TCFD, Guidance on Metrics, Targets, and Transition Plans, 2021

23

Climate-related targets

24Climate-Related Targets

The 2021 guidance provides an overview of the types of information the Task Force believes areuseful to include when disclosing climate-related targets
Disclosing Climate-Related Targets

A climate-related target refers to a specific level, threshold,quantity, or qualitative goal that the organization wishes tomeet over a defined time horizon in order to address its
climate-related risks and opportunities.

Characteristics of Effective Climate-Related Targets
Aligned with Strategy and Risk Management Goals
Linked to Relevant Metrics

A company’s climate-related targets should inform, and be
informed by, its strategy and risk management and belinked to its climate-related metrics.

Quantified and Measurable

Effective disclosure of climate-related targets includes
grounding disclosures in narrative or qualitative information
to help users understand their context.

• Baseline• Companies should describe the qualitative informationthat encompasses climate-related targets and reflects
longer-term changes to an organization’s business or
expected strategic direction.
• Companies should also consider disclosing in formats thatwould lead to better standardization and comparability.

Clearly Specified over Time
• Time horizon• Interim targets
Understandable and Contextualized
Periodically Reviewed and Updated
Reported AnnuallySource: TCFD, Guidance on Metrics, Targets, and Transition Plans, 2021

25

Examples of Quantified Climate-Related Targets

The guidance also provides examples of quantified targets that align with the cross-industry,
climate-related metric categories
Cross-Industry Metric Category

Climate-Related Target Examples

GHG Emissions• Reduce net Scope 1, Scope 2, and Scope 3 GHG emissions to zero by 2050, with aninterim target to cut emissions by 70% relative to a 2015 baseline by 2035

See next page

Transition Risks• Reduce percentage of asset value exposed to transition risks by 30% by 2030, relative
to a 2019 baseline

Physical Risks• Reduce percentage of asset value exposed to acute and chronic physical climaterelated risks by 50% by 2050
• Ensure at least 60% of flood-exposed assets have risk mitigation in place in line withthe 2060 projected 100-year floodplain

Climate-Related Opportunities• Increase net installed renewable capacity so that it comprises 85% of total capacity by
2035

Capital Deployment• Invest at least 25% of annual capital expenditure into electric vehicle manufacturing• Lend at least 10% of portfolio to projects focused primarily on physical climate-related
risk mitigation

Internal Carbon Pricing• Increase internal carbon price to $150 by 2030 to reflect potential changes in policy

Remuneration•

Increase amount of executive management remuneration impacted by climate
considerations to 10% by 2025

Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

26

Illustrative Disclosure Example: GHG Emissions Reduction
Targets
Example Disclosure

The figure on the right shows therelationship between GHG emissions andtargets for a hypothetical firm. The
illustrative GHG emissions pathways wereadapted from Network for Greening the
Financial System (NGFS) scenario data.

Our firm commits to reducing net Scope 1 and 2 GHG emissions—as defined by
the GHG Protocol—to zero by 2050, with an interim target to cut Scope 1 and 2
GHG emissions by 2030 by 50%, relative to a 2015 baseline.
Current Metrics
Historical Metrics

CO2–Equivalent GHG Emissions (Tonnes)

Climate-related targets should be linked todefined metrics in order to measure andtrack progress against targets and assist
with periodic reviews to determine whether
updates to the targets may be necessary.

Forward-Looking Information

-20%

-%

2000

-100%

-50%

Interim target

Historical data
Company target GHG emissions path
GHG emissions under current policies scenario-70%

GHG emissions under delayed 2°C scenario
GHG emissions under immediate 2°C scenario-90%

GHG emissions under 1.5°C scenario
2005

2010

2015

2020

Source: TCFD, Guidance on Metrics, Targets, and Transition Plans, 2021
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure.
They may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of
specific companies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

2025

2030

2035

2040

2045

2050

27

Illustrative Disclosure Example: GHG Emissions Reduction
Targets (continued)
Example Disclosure
The template on the right provides a possible
approach for disclosing corporate GHG emissions
reduction targets along with the associatedmethodology used. It also provides flexibility interms of the type of target and the Scope(s)covered.
The example included here is for a fictional
company. It shows how one of the company’s
targets as indicated by the entry for Target
number—1 (of 4), could be reported and provides
additional comments in the last column.

Source: Kooroshy, et al., Towards investor-oriented carbon targets data, October 2021, p. 10. Developed by FTSE Russell, part of LSEG.
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

28

Discussion question• Does your company currently set or plan toset climate-related targets? If so, which
ones?

29

Additional Resources

Other resources on how to get started can be found on the TCFD website and the Knowledge Hub
TCFD Website

Knowledge Hub• Find all the information you need about the TCFD on its
official website, including the recommendations and allother publications.

• Find additional TCFD-related resources curated by the CDSB
(information on the recommendations, alignment withother frameworks, online courses, etc).

https://www.fsb-tcfd.org/

https://www.tcfdhub.org/

30

Q&A

31

Appendix

32

Examples of climate-related risks andopportunities, and potential financial
impacts

33

Examples of Climate-Related Risks and Potential Financial
Impacts
Table A1.1

Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

34

Examples of Climate-Related Opportunities and Potential
Financial Impacts
Table A1.2

Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

35

Drill-down on cross industry, climaterelated metric categories

36

Cross-Industry Climate-Related Metric Categories
Table A2.1
Metric Category

Example Unit of Measure1

Rationale for Inclusion

GHG Emissions
Absolute Scope 1, Scope 2, andScope 3; emissions intensity

MT of CO2e

Disclosure of GHG emissions is crucial for users to understand a company’s exposure to climaterelated risks and opportunities. Disclosure of both absolute emissions across a company’s value chain
and relevant emissions intensity provides insight into how a given company may be affected by policy,
regulatory, market, and technology responses to limit climate change.

Transition Risks
Amount and extent of assets orbusiness activities vulnerable
to transition risks*

Amount or percentage

Disclosure of the amount and extent of a company’s assets or business activities vulnerable toclimate-related transition risks allows users to better understand potential financial exposure
regarding such issues as possible impairment or stranding of assets, effects on the value of assets andliabilities, and changes in demand for products or services.

Physical Risks
Amount and extent of assets orbusiness activities vulnerable
to physical risks*

Amount or percentage

Disclosure of the amount or extent of a company’s assets or business activities vulnerable to material
climate-related physical risks allows users to better understand potential financial exposure regarding
such issues as impairment or stranding of assets, effects on the value of assets and liabilities, and costof business interruptions.

Climate-Related Opportunities
Proportion of revenue, assets, orother business activities alignedwith climate-related
opportunities

Amount or percentage

Disclosure of the proportion of revenue, assets, or business activities aligned with climate-related
opportunities provides insight into the position of company's relative to their peers and allows users
to understand likely transition pathways and potential changes in revenue and profitability over time.

Capital Deployment
Amount of capital expenditure,
financing, or investment
deployed toward climate- relatedrisks and opportunities

Reporting currency

Capital investment disclosure by non-financial companies and financing by financial companies gives
an indication of the extent to which long-term enterprise value might be affected.

1.

The Task Force has noted the most common unit of measure. There are multiple ways to measure and disclose metrics, and different jurisdictions orindustries may follow different practices. Allowing for differences in units of measure can help provide companies with flexibility without significantly
impacting comparability as long as units are clearly stated.
Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

37

Cross-Industry Climate-Related Metric Categories (continued)
Table A2.1
Metric Category

Example Unit of Measure1

Rationale for Inclusion

Internal Carbon Prices
Price on each ton of GHG
emissions used internally by ancompany

Price in reporting currency, per MT
of CO2eInternal carbon prices provide users with an understanding of the reasonableness of a company’s risk
and opportunity assessment and strategy resilience. The disclosure of internal carbon prices can help
users identify which companies have business models that are vulnerable to future policy responses
to climate change and which are adapting their business models to ensure resilience to transition
risks.

Remuneration
Proportion of executive
Management remuneration
linked to climate
considerations**

Percentage, weighting, description,or amount in reporting currency

Remuneration policies are important incentives for achieving an company’s goals and objectives andmay provide insight on an company’s governance, oversight, and accountability for managing climaterelated issues.

Note: While some companies already disclose metrics consistent with these categories, the Task Force recognizes others—especially those in the early stages of disclosing climate-related
financial information—may need time to adjust internal processes before disclosing such information. In addition, some of the metric categories may be less applicable to certain companies. For
example, data and methodologies for certain metrics for asset owners (e.g., impact of climate change on investment income) are in early stages of development. In such cases, the Task Forcerecognizes companies will need time before such metrics are disclosed to their stakeholders.
On the application of materiality, the Task Force believes all companies should disclose absolute Scope 1 and Scope 2 GHG emissions independent of a materiality assessment. The disclosure of
Scope 3 GHG emissions is subject to materiality; however, the Task Force encourages companies to disclose such emissions. The other cross-industry, climate-related metric categories remainsubject to materiality. Companies should determine materiality for climate-related metrics consistent with how they determine the materiality of other information included in their financial
filings.
*Transition and Physical Risks: Due to challenges related to portfolio aggregation and sourcing data from companies or third-party fund managers, financial companies may find it more difficult toquantify exposure to climate-related risks. The Task Force suggests that financial companies provide qualitative and quantitative information, when available.
**Remuneration: While the Task Force encourages quantitative disclosure, Companies may include descriptive language on remuneration policies and practices, such as how climate change
issues are included in balanced scorecards for executive remuneration.

1.

The Task Force has noted the most common unit of measure. There are multiple ways to measure and disclose metrics, and different jurisdictions orindustries may follow different practices. Allowing for differences in units of measure can help provide companies with flexibility without significantly
impacting comparability as long as units are clearly stated.
Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

38

Example of Disclosure for GHG Emissions
Absolute Scope 1, Scope 2, and Scope 3; emissions intensity
Key Takeaways from Guidance• Disclosure of GHG emissions is useful forunderstanding a company’s exposure toclimate-related risks as absoluteemissions across a company’s value
chain and relevant emissions intensity
may provide insight into how a company
may be affected by policy, regulatory,
market, and technology responses tolimit climate change.

Example Disclosure: Barclays

Bank’s disclosure of forward-looking estimates for absolute and intensity-based
financed GHG emissions• Companies may find it useful to further
disclose GHG emissions by:o Relevant business lineo GHG emissions split out by theseven gases covered by the Kyoto
Protocolo Emissions intensity• Disclosing cumulative GHG emissions
over time relative to the baseline year
used for a company’s GHG emissions
reduction target can also help users
better understand a company’s exposure
to climate-related issues

Source: Barclays PLC, ESG Report 2020, p. 16
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

39

Example of Disclosure for Transition Risks

Amount and extent of assets or business activities vulnerable to transition risks
Key Takeaways from Guidance• Disclosure of the amount and extent of acompany’s assets or business activities
vulnerable to climate-related transition
risks allows users to better understandpotential financial exposure regarding
such issues as possible impairment or
stranding of assets, effects on the valueof assets and liabilities, and changes indemand for products or services.

Example Disclosure: Citi

Bank’s disclosure of transition risk exposure for various business sectors and subsectors (e.g., Energy, Power, Transportation, Industrials, Real Estate, etc.).

• The way in which companies disclose thismetric category will depend on theirindustry and company-specific climaterelated risks, e.g.,:– Banks may look at the proportion of
their lending activities or portfolios
materially exposed to carbon-related
assets– Non-financial companies may choose
to report amount or percentage of
operating earnings, revenues, or
production output coming from highcarbon business lines
Source: Citi, Finance for a Climate-Resilient Future II, 2020, p. 49.
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

40

Example of Disclosure for Physical Risks

Amount and extent of assets or business activities vulnerable to physical risks
Key Takeaways from Guidance• Disclosure of the amount or extent of acompany’s assets or business activities
vulnerable to material climate-related physicalrisks allows users to better understandpotential financial exposure regarding such
issues as impairment or stranding of assets,
effects on the value of assets and liabilities,
and cost of business interruptions.

Example Disclosure: Ilmarinen

Insurance company’s disclosure of the proportional exposure to physical risk bybusiness activity/asset category• Physical risks will be specific to the geography
where the assets or activities are located andtheir likely exposure or vulnerability to therisk:– Certain assets may be most vulnerable toacute risks from hurricanes or wildfires– Others may be more at risk from chronicchanges in average temperature, sea-levelrise, or drought• Companies that are not yet able to disclose
physical risk vulnerability could begin bydescribing the types of tools they are using toassess such risks
Source: Ilmarinen, Annual and Sustainability Report 2020, p. 50
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

41

Example of Disclosure for Physical Risks (continued)

Amount and extent of assets or business activities vulnerable to physical risks
Key Takeaways from Guidance• Disclosure of the amount or extent of acompany’s assets or business activities
vulnerable to material climate-related physicalrisks allows users to better understandpotential financial exposure regarding such
issues as impairment or stranding of assets,
effects on the value of assets and liabilities,
and cost of business interruptions.

Example Disclosure: ERAFP

Asset owner’s disclosure of exposure to physical risk for aggregate assets basedon a severity characterization• Physical risks will be specific to the geography
where the assets or activities are located andtheir likely exposure or vulnerability to therisk:– Certain assets may be most vulnerable toacute risks from hurricanes or wildfires– Others may be more at risk from chronicchanges in average temperature, sea-levelrise, or drought• Companies that are not yet able to disclose
physical risk vulnerability could begin bydescribing the types of tools they are using toassess such risks
Source: ERAFP, Public Report 2020, p. 89
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

42

Example of Disclosure for Climate-Related Opportunities
Proportion of revenue, assets, or other business activities aligned with climate-related
opportunities
Key Takeaways from Guidance• Disclosure of the proportion of revenue, assets, orbusiness activities aligned with climate-related
opportunities provides insight into the position ofcompanies relative to their peers and allows users
to understand likely transition pathways andpotential changes in revenue and profitability overtime.

Example Disclosure: BASF

Chemicals company characterizes sales by sustainability indicator to
identify alignment with climate-related opportunities• The operationalization of this metric category willbe specific to each industry or company’s climaterelated opportunities, as well as to theopportunities within specific business lines or asset
classes, e.g.:– Auto manufacturers might report sales ofelectric vehicles relative to total vehicle sales– Utilities companies could report renewablegeneration as a fraction of their total electricity
generation– Agricultural companies might report revenues
received from the sale of drought-resilient seeds– Asset managers could disclose the percent ofresilient infrastructure in their portfolio
Source: BASF, BASF 2020 Report, p. 45
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

43

Example of Disclosure for Capital Deployment

Amount of capital expenditure, financing, or investment deployed toward climate-related risks andopportunities
Key Takeaways from Guidance• Capital investment disclosure by
non-financial companies andfinancing by financial organizations
gives an indication of the extent towhich long-term enterprise value
might be affected, for example bydemonstrating how a company isinvesting to take advantage ofclimate-related opportunities

Example Disclosure: Liberty Mutual

Insurance company’s inclusion of traditional disclosures alongside climate-related
disclosures to allow users to understand the scale of investment deployed towards
climate-related risks and opportunities• Capital expenditures, capital
investments, or the amount offinancing for new technologies,
infrastructure, or products can bereported in line with financial
reporting standards and commonlyused taxonomies for delineatingclimate-related risks andopportunities.

Source: Liberty Mutual, 2020 ESG Review, p. 8
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

44

Example of Disclosure for Internal Carbon Prices
Price on each ton of GHG emissions used internally by a company
Key Takeaways from Guidance• Internal carbon prices provide users with anunderstanding of the reasonableness of acompany’s risk and opportunity assessment andstrategy resilience. The disclosure of internalcarbon prices can help users identify which
companies have business models that arevulnerable to future policy responses to climatechange and which are adapting their businessmodels to ensure resilience to transition risks.

Example Disclosure: Aker BP

Energy company provides internal planning assumptions along withinternal carbon prices from two IEA scenarios• An increasing number of companies are setting
an internal notional or actual price on theamount of CO2 emitted from assets andinvestment projects. This will allow users to see
how, where, and when their GHG emissions
could affect their strategy, profit-and-loss (P&L)
statements, and investment choices• The Task Force acknowledges that internalcarbon prices may not be relevant to allcompanies, such as those without material
physical or transition risks or those alreadysubject to external carbon prices
Source: Aker BP, Sustainability Report 2020, p. 25
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

45

Example of Disclosure for Remuneration

Proportion of executive management remuneration linked to climate considerations
Key Takeaways from Guidance• Remuneration policies are important incentives
for achieving a company’s goals and objectives
and may provide insight on a company’s
governance, oversight, and accountability for
managing climate-related issues.

Example Disclosure: HSBC

Bank’s disclosure notes the percentage weighting linked to climate
consideration within the scorecards of executive and managing directors• The ways in which companies link executive
compensation to performance on issues
related to climate change will be specific totheir company and governance structure:– Some companies choose to report thepercentage of the executive’s pay linked toclimate considerations– Others discuss weighting factors or total
amount of compensation that could be
impacted• While the Task Force encourages quantitative
disclosure, companies may include descriptive
language on remuneration policies andpractices, such as how climate change issues
are included in balanced scorecards for
executive remuneration
Source: HSBC, Annual Report 2020, p. 20
Note: Some content was reformatted in order to fit the page; and some content has been removed, denoted by […].
The examples included are not intended to represent “best practice” nor demonstrate disclosures that fully meet the associated recommended disclosure. They
may not be applicable to all sectors and should be considered within the framework of the sector in which the company operates. The mention of specificcompanies does not imply that they are endorsed by the TCFD or its members in preference to others of a similar nature that are not mentioned.

46

Supplemental guidance for thefinancial sector and non-financialgroups47

Overview of the Supplemental Guidance

The Task Force identified certain areas where supplemental guidance was warranted, for both thefinancial sectors and non-financial groups
Financial Sector

Non-Financial Groups

The supplemental guidance is intended to provide
additional context for the financial sector when
preparing disclosures consistent with the Task Force’s
recommendations, namely for the following four
major industries:– Banks– Insurance Companies– Asset Owners– Asset Managers

Similarly, supplemental guidance is included forcompanies within four non-financial groups. These
groups comprise industries in the following fourareas:– Energy– Transportation– Materials and Buildings– Agriculture, Food, and Forest Products

Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

48

Supplemental Metrics and Targets Guidance for the Financial
Sector
Metrics and Targets

Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where suchinformation is material.
Banks
Recommended disclosure a)
Disclose the metrics used by
the company to assessclimate-related risks andopportunities in line with its
strategy and risk
management process

Banks should provide the metrics used to assess the impact of (transition and physical) climate-related risks
on their lending and other financial intermediary business activities in the short, medium, and long term.
Metrics provided may relate to credit exposure, equity and debt holdings, or trading positions, broken down by:• Industry• Geography• Credit quality (e.g., investment grade or non-investment grade, internal rating system)• Average tenor
Banks should also provide the amount and percentage of carbon-related assets relative to total assets as wellas the amount of lending and other financing connected with climate-related opportunities.
Banks should describe the extent to which their lending and other financial intermediary business activities,
where relevant, are aligned with a well below 2°C scenario, using whichever approach or metrics best suit
their organizational context or capabilities. Banks should also indicate which financial intermediary businessactivities (e.g., loans to specific sectors or industries) are included.

Recommended disclosure b)
Disclose Scope 1, Scope 2,
and, if appropriate, Scope 3
greenhouse gas (GHG)
emissions, and the relatedrisks

Banks should disclose GHG emissions for their lending and other financial intermediary business activities
where data and methodologies allow. These emissions should be calculated in line with the Global GHG
Accounting and Reporting Standard for the Financial Industry developed by the Partnership for Carbon
Accounting Financials (PCAF Standard) or a comparable methodology (see Table 2 of the 2021 Annex).

Note: For readability, we removed footnote references from these excerpts. Please see the annex referenced below for more information.
Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

49

Supplemental Metrics and Targets Guidance for the Financial
Sector (continued)
Metrics and Targets

Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where suchinformation is material.
Insurance Companies
Recommended disclosure a)
Disclose the metrics used by
the company to assessclimate-related risks andopportunities in line with its
strategy and risk
management process

Insurance companies should provide aggregated risk exposure to weather-related catastrophes of theirproperty business (i.e., annual aggregated expected losses from weather-related catastrophes) by relevant
jurisdiction.

Recommended disclosure b)
Disclose Scope 1, Scope 2,
and, if appropriate, Scope 3
greenhouse gas (GHG)
emissions, and the relatedrisks

Insurance companies should disclose weighted average carbon intensity or GHG emissions associated withcommercial property and specialty lines of business where data and methodologies allow.

Insurance companies should describe the extent to which their insurance underwriting activities, where
relevant, are aligned with a well below 2°C scenario, using whichever approach or metrics best suit theirorganizational context or capabilities. Insurance companies should also indicate which insurance underwriting
activities (e.g., lines of business) are included.

Note: For readability, we removed footnote references from these excerpts. Please see the annex referenced below for more information.
Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

50

Supplemental Metrics and Targets Guidance for the Financial
Sector (continued)
Metrics and Targets

Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where suchinformation is material.
Asset Owners
Recommended disclosure a)
Disclose the metrics used by
the company to assessclimate-related risks andopportunities in line with its
strategy and risk
management process

Recommended disclosure b)
Disclose Scope 1, Scope 2,
and, if appropriate, Scope 3
greenhouse gas (GHG)
emissions, and the related
risks

Asset owners should describe metrics used to assess climate-related risks and opportunities in each fund orinvestment strategy. Where relevant, asset owners should also describe how these metrics have changed overtime.
Where appropriate, asset owners should provide metrics considered in investment decisions and monitoring.
Asset owners should describe the extent to which assets they own and their funds and investment strategies,
where relevant, are aligned with a well below 2°C scenario, using whichever approach or metrics best suit
their organizational context or capabilities. Asset owners should also indicate which asset classes are included.
Asset owners should disclose GHG emissions for assets they own and the weighted average carbon intensity(WACI) for each fund or investment strategy, where data and methodologies allow. These emissions should be
calculated in line with the Global GHG Accounting and Reporting Standard for the Financial Industry developedby the Partnership for Carbon Accounting Financials (PCAF Standard) or a comparable methodology (see Table
2, of the 2021 Annex).
In addition to WACI, asset owners should consider providing other carbon footprinting metrics they believe
are useful for decision-making. See Table 3 of the 2021 Annex for additional common carbon footprinting andexposure metrics.

Note: For readability, we removed footnote references from these excerpts. Please see the annex referenced below for more information.
Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

51

Supplemental Metrics and Targets Guidance for the Financial
Sector (continued)
Metrics and Targets

Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where suchinformation is material.
Asset Managers
Recommended disclosure a)
Disclose the metrics used by
the company to assessclimate-related risks andopportunities in line with its
strategy and risk
management process

Asset managers should describe metrics used to assess climate-related risks and opportunities in each productor investment strategy. Where relevant, asset managers should also describe how these metrics have changed
over time.

Recommended disclosure b)
Disclose Scope 1, Scope 2,
and, if appropriate, Scope 3
greenhouse gas (GHG)
emissions, and the related
risks

Asset managers should disclose GHG emissions for their assets under management and the weighted averagecarbon intensity (WACI) for each product or investment strategy, where data and methodologies allow. Theseemissions should be calculated in line with the Global GHG Accounting and Reporting Standard for the Financial
Industry developed by the Partnership for Carbon Accounting Financials (PCAF Standard) or a comparable
methodology (see Table 2 of the 2021 Annex).

Where appropriate, asset managers should provide metrics considered in investment decisions andmonitoring.
Asset managers should describe the extent to which their assets under management and products andinvestment strategies, where relevant, are aligned with a well below 2°C scenario, using whichever approachor metrics best suit their organizational context or capabilities. Asset managers should also indicate which asset
classes are included.

In addition to WACI, asset managers should consider providing other carbon footprinting metrics they believe
are useful for decision-making. See Table 3 of the 2021 Annex for additional carbon footprinting and exposure
metrics.

Note: For readability, we removed footnote references from these excerpts. Please see the annex referenced below for more information.
Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

52

Supplemental Metrics and Targets Guidance for the NonFinancial Groups
Metrics and Targets

Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where suchinformation is material.
Energy, Transportation, Materials & Buildings, and Agriculture, Food, and Forest Products
Recommended disclosure a)
Disclose the metrics used by
the company to assessclimate-related risks andopportunities in line with its
strategy and risk
management process

For all relevant metrics, companies should consider providing historical trends and forward-looking
projections (by relevant country and/or jurisdiction, business line, or asset type). Companies should also
consider disclosing metrics that support their scenario analysis and strategic planning process and that areused to monitor the company’s business environment from a strategic and risk management perspective.
Companies should consider providing key metrics related to GHG emissions, energy, water and other physicalrisk exposures, land use, and, if relevant, investments in climate adaptation and mitigation that address
potential financial aspects of shifting demand, expenditures, asset valuation, and cost of financing.

Source: TCFD, Annex: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures, 2021

53