Lawyer group welcomes decision to endorse climate-change financial disclosure framework

by Duffie Osental10 Aug 2019

Lawyers for Climate Action NZ has welcomed the decision of the New Zealand government to endorse the establishment of a framework for the disclosure of climate-related risks in corporate financial reporting.

In a report issued this week, the government accepted the June 2017 recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) as one avenue for the disclosure of climate risk.

“High-quality disclosures will help investors, lenders and insurers make more informed decisions,” the government said in its report. “They will also provide reporting entities with incentives to manage risks and take advantage of opportunities.”

Jenny Cooper, president of Lawyers for Climate Action NZ, said that the endorsement of a clear set of principles around climate-risk reporting will be welcomed by investors and provide useful guidance for boards.

“There is growing awareness that climate change will have a material impact on asset values and income streams within the near and medium-term time horizons that investors are focused on, as the transition away from fossil fuels gathers pace and the physical impacts of global warming start to bite,” said Cooper. “Better information gathering and analysis by companies for disclosure purposes will facilitate better decision making by boards. This will help ensure that New Zealand’s economy can adapt to climate change and that we are well-positioned to benefit from the opportunities that the global transition to low carbon technologies will bring.”