Nestlé, Unilever, 3 other firms share best climate-related practices

12 / 04 / 2020

By Marwa Nassar - -

Mondi, Nestlé, Olam, Unilever, Stora Enso and Syngenta collaborated with the World Business Council for Sustainable Development to publish a report sharing their best climate-related practices.

The move aims at encouraging transparency and consistency in climate-related financial reporting.

As part of the Task Force on Climate-related Financial Disclosures (TCFD) Preparer Forum for Food, Agriculture & Forest Products, the five companies – which are WBCSD members – share examples, lessons learned and reflections on how they are implementing the TCFD recommendations and responding to climate-related risks and opportunities.

“As COVID-19 has shaken the global landscape significantly, companies’ operations, value chains and risk management are under enormous stress and their readiness to respond to current risks such as pandemics and climate change are being questioned. The TCFD recommendations are the most important and transparent leverage to link climate-related risks and opportunities to company decisions and capital market valuations. Driving the risk assessment, strategic scenario building, management and investor action to realize the low-carbon transition.” said Prof. Dr. Rodney Irwin, Managing Director, Redefining Value and Education, WBCSD.

Financial markets need better and complete information about climate change. The TCFD aims to address this issue through their recommendations, designed to help companies disclose climate-related financial risks and opportunities. This report, in conjunction with the work of other TCFD Preparer Forums, helps companies implement the TCFD’s recommendations on climate-related financial disclosure.

The report highlights:

The report showcases examples of effective disclosure practice across governance, strategy, risk management, metrics and targets.

The report highlighted the integration of climate-related risks and opportunities into risk management processes with insights from risk professionals.

It also reviewed strategic responses to climate change and the low-carbon transition realized through innovation and technology, natural climate solutions, the circular bioeconomy, farmer and smallholder resilience and managing loss and waste.

The report also touched on the use of scenario analysis to asses business and climate resilience, supporting complex decision making.

It also highlighted illustrative climate-related metrics relating to low-carbon solutions, adaptation and resilience measures, productivity and resource management.

Finally, it presented perspectives and insights from users including equity and credit analysts.

TCFD Vice Chair comment:

Graeme Pitkethly, Chief Financial Officer of Unilever and Vice Chair of TCFD, said “It’s fundamental for every good business to manage and communicate risks and opportunities. Climate change is no different. It’s a risk that is already affecting companies today – through the impacts of changing weather patterns and emerging policies around the world. The work of the task force and TCFD Preparer Forums supports a practical response providing information and transparency to help investors make better decisions for the long term, information for our markets to operate efficiently and beyond markets, providing the transparency that is increasingly important to our consumers too. In our Annual Report, we disclosed details of our scenario analysis and the material impacts that might arise from 2 and 4-degree warming scenarios. We hope that by sharing our experience in conducting and disclosing the outcomes of the scenario analysis, other companies will follow suit. I’d urge all companies to adopt the recommendations.”

Building on the efforts of the TCFD Oil & Gas, Electric Utilities, Chemicals, Construction and Building Materials and Food, Agriculture & Forest Products Preparer Forums, WBCSD will initiate a TCFD Preparer Forum for companies involved in the manufacture and leasing of automobiles.