Best practices for cross-border climate disclosures

Criteria for Climate & Net Zero Reporting 🌎 This framework, developed by KPMG, provides a clear and practical benchmark to evaluate the quality of corporate climate and net zero disclosures. It is based on international best practices and draws heavily from the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). The criteria are grouped into four focus areas: Governance, Risk Identification, Impacts, and Net Zero Transition. Each area outlines specific reporting elements that reflect the maturity and robustness of a company’s approach to climate-related issues. Under Governance, disclosures should show that board-level responsibility has been assigned to oversee climate matters. In addition, climate risks should be referenced in the Chair or CEO’s message, and the company should clearly acknowledge climate change as a material financial risk. In the Risk Identification category, strong reporting includes a dedicated climate risk section in the annual report or a standalone TCFD-aligned report. It should also cover both physical risks (e.g., extreme weather) and transitional risks (e.g., policy shifts or market changes). Impacts criteria emphasize the importance of scenario analysis to understand how different climate outcomes could affect the business. Companies are expected to report using multiple warming scenarios and clear timeframes, relying on reputable sources such as the IPCC or IEA. The Net Zero Transition section highlights the need for science-based or net zero targets. A credible strategy for decarbonization should be disclosed, including the actions the company will take and the timelines involved. Transparent progress tracking is also essential. Disclosures should communicate whether the company is on track to meet its targets, identifying any challenges or adjustments made along the way. Finally, the use of an internal carbon price is seen as a strong indicator of preparedness for future regulation. It demonstrates that climate-related financial risks are being factored into planning and investment decisions. Source: KPMG #sustainability #sustainable #business #esg #reporting

🌍 Navigating the CSDDD with CDP: A Must-Read Guide🌍 The Corporate Sustainability Due Diligence Directive (CSDDD) is setting the stage for stronger corporate accountability and sustainability in the EU. But how can companies ensure they're meeting these expectations? 🤔 The latest CDP Policy Explainer provides a detailed roadmap, highlighting how companies can address the CSDDD requirements as well as how they align with CDP disclosures. In addition, the guide covers climate transition plans in alignment with global standards, including IFRS S2, ERFAG (ESRS), SEC, GRI, and GFANZ. 🔍 What you’ll learn: 1️⃣ Clear Transition Plan Elements: Governance, scenario analysis, risk management, strategy, financial planning, and target setting – all critical pieces for a successful climate transition plan. 2️⃣ Standards & Frameworks: Learn how your disclosures align with leading frameworks like IFRS, ESRS, and GFANZ, making sure you're compliant with CSDDD requirements. 3️⃣ Actionable Insights: From governance to value chain engagement, the guide shows exactly where and how to report on your company’s climate risks, opportunities, and progress. 4️⃣ Full vs. Partial Coverage: Know which elements the standards require and where CDP goes beyond, helping you stay ahead of the regulatory curve. 🌱 Why it matters: With global regulatory pressure increasing, aligning with these frameworks can boost a company’s credibility, manage risks, attract capital, and ensure long-term resilience. #CDP #CSDDD #Sustainability #ClimateTransition #IFRS #ISSB #GRI #ESRS #CSRD #GFANZ #CorporateGovernance #ClimateStrategy #NetZero #TransitionPlans #DueDiligence #ESGRegulation

CDP and EFRAG have released correspondence mapping between the CDP question bank and ESRS E1 (EU’s Climate Standard)—a major step toward simplifying climate disclosures under both frameworks. 💡 What’s in it for Companies? ✅ Simplified Reporting – Use the same data for CDP and CSRD (Corporate Sustainability Reporting Directive). ✅ Increased Efficiency – Reduce duplication and streamline climate-related disclosures. ✅ Better Data Quality – Align processes with global standards for more reliable insights. 📊 Key Areas of Alignment: Climate Transition Plans – Consistent reporting on climate mitigation strategies. GHG Emissions (Scopes 1, 2, 3) – Unified methodology across frameworks. Climate Targets & Carbon Pricing – Harmonized disclosure of climate goals and internal carbon pricing. 🔎 Why This Matters: Easier Compliance – CDP reporters are now better equipped to meet CSRD obligations. Data Consistency – Enhanced accuracy for investor and stakeholder transparency. Strategic Advantage – Less time on reporting, more time driving sustainability action. 📢 With dual reporting becoming the norm, this alignment is a game-changer for companies looking to stay efficient and compliant. Is your organization ready to navigate ESG reporting with ease? #ESG #SustainabilityReporting #CDP #CSRD #ClimateDisclosures #EFRAG #Sustainability CSRD Institute

Guidance on Climate Transition Plans under ESRS For organisations navigating climate reporting and sustainability compliance, the new guidance on implementing climate transition plans under the European Sustainability Reporting Standards (ESRS) provides valuable support! The guidance provides an approach for organisations to meet the ESRS requirements by detailing disclosure obligations that align with key EU regulations, such as the Corporate Sustainability Due Diligence Directive (CSDDD) and the EU Taxonomy. This alignment helps ensure climate transition activities and sustainability disclosures meet broader European compliance standards, reinforcing their commitment to responsible and sustainable practices in line with EU legislation. 1️⃣ Purpose: Offers non-binding guidance to help organizations create effective transition plans for climate change mitigation. 2️⃣ Compliance: Maps out how ESRS aligns with EU laws like the Corporate Sustainability Due Diligence Directive (CSDDD) and EU Taxonomy, ensuring regulatory alignment 3️⃣ Structure: Covers all aspects of climate disclosure—from European frameworks and disclosure requirements to international standards 4️⃣ Paris Agreement Alignment: Organizations must disclose targets that align with the 1.5°C goal, showing commitment to global climate efforts 5️⃣ Decarbonization: Outlines required emissions reduction actions, including operational changes and product modifications. Organisations are required to outline specific actions, known as "decarbonization levers," which may include operational adjustments, product changes, and other emissions reduction initiatives 6️⃣ Investments: Specifies the need for transparent reporting on investments, including EU Taxonomy-aligned CapEx for sustainable projects 7️⃣ Disclosures: Companies involved in EU Taxonomy activities must show their alignment with taxonomy criteria for sustainable finance 8️⃣ Governance: Transition plans should be embedded within overall corporate strategy, backed by governance bodies to ensure alignment with broader goals 9️⃣ Progress: Regular updates on implementation are required, measuring action effectiveness toward emissions targets 🔟 IROs from climate change mitigation: The guidance stresses the need for organisations to assess and disclose social and environmental impacts, risks, and opportunities linked to their climate transition plans The guidance emphasises that climate transition plans should be fully embedded within a company's overarching strategy and be actively supported by governance bodies. This integration ensures that climate goals are not treated as standalone objectives but are interwoven with long-term corporate planning. By doing so, organisations can align their climate ambitions with their overall business objectives, securing strategic and governance-level commitment to climate action.