Climate-related Financial Disclosures

Debate between Baroness Jones of Whitchurch and Lord Henley

Tuesday 30th January 2018 Lords Chamber

[Lord Henley]

My Lords, that is one view. It was looked at by the Environmental Audit Committee inquiry on green finance, which sought evidence on the effectiveness of the TCFD’s recommendations and the Government’s role in supporting their implementation. There is broad consensus among stakeholders that companies will certainly require more time to implement the recommendations but some have recommended making disclosure mandatory within, say, two to three years. The Government have not yet taken a view on this matter and will consider it in due course.

[Baroness Jones of Whitchurch (Lab)]

My Lords, it is estimated that listed companies account for around a quarter of global carbon emissions, with oil companies obviously among the biggest polluters. Therefore, does the Minister agree that investors should have a responsibility to demand that those sorts of multinationals, in addition to individual countries, sign up to the Paris Agreement and set out their business strategy for a net zero-emissions world? That is the only way that we are going to tackle this issue on a global basis and ensure that we protect shareholder investment.

[Lord Henley]

My Lords, I accept what the noble Baroness is saying: that is very useful information for investors and others who are interested in what the companies are up to. We explicitly ask for feedback on those TCFD recommendations and whether they should be mandatory in the long run. However, one has to balance against that the fact that it potentially imposes a burden on businesses, and one would have to look at how exactly that should be done. At the moment it is not mandatory. We will consider that in due course, but at the moment it is best that we analyse the responses we have had to the various consultations and then come forward with our recommendations.