For example, the World Business Council for Sustainable Development (WBCSD) has convened or announced “preparer forums” for various sectors and industries: oil and gas; electric utilities; chemicals; 9  All speeches are available online at www.bankofengland.co.uk/news/speeches  9  Looking ahead, the TCFD is currently considering how to:   Provide additional guidance on how to conduct scenario analysis;    Publish business-relevant scenario templates to lower implementation costs; improve understanding and improve comparability; and    Start a work stream on how to roll out these approaches to portfolio measurement to more asset owners. The Bank of England is doing our part by assessing the strategic resilience of the world’s leading financial centre. The Bank will be the first regulator to stress test its financial system against different climate pathways, including the catastrophic business as usual scenario and the ideal—but still challenging— transition to net zero by 2050 consistent with the UK’s legislated objective.17 In response, banks will need to establish how their borrowers are managing current and future climaterelated risks and opportunities. Those assessments will reveal:   Which firms have strategies for the transition to a net zero economy;    Which are gambling on new technologies or government inaction; and    Which haven’t yet thought through the risks and opportunities. The test will help develop and mainstream cutting-edge risk management techniques, and it will make the heart of the global financial system more responsive to changes in the climate and to government climate policies.

Conversely, companies that embrace climate risk reporting will appear ahead of the curve and be well positioned to take full advantage of the commercial opportunities presented by the transition to a low carbon economy.” For full report, see: https://www.smithschool.ox.ac.uk/research/sustainable-finance/publications/CCLI-TCFD-Concerns-Misplaced-Report-Final-Briefing.pdf 11  7  All speeches are available online at www.bankofengland.co.uk/news/speeches  7  Supervisors of financial sector firms will also need to consider which metrics are most useful for different levels of assessment: -  Microprudential, to assess how individual firms are managing climate-related risks – for example the impact of a physical or transition risk on a loan book. -  Macroprudential, to consider how and whether individual exposures could scale up to systemic risk  -  Macroeconomic, to help understand how the financial system and economy interact in different climate transition scenarios. Quantitative assessments could help guide these judgements. Research by the Bank and PwC found that some TCFD disclosures were positively correlated with stock price of firms that have disclosed to date, with the disclosures about a firm’s targets; scope 1, 2 and 3 emissions; risk management, resilience and impacts exhibiting the strongest correlations. Note that given the potential selection bias of companies with climate strategies tend to be early adopters of the TCFD, these correlations were positive. Table 1: Strength of correlation between individual TCFD recommendations and stock price  Recommendation Recommended disclosure Governance a. Board Oversight  Co-efficent 0.36  P-value 0.00  Adjust rsquared 0.40  b. Management's Role  0.51  0.00  0.40  a.