Statement of Verena Radulovic (See bio)
Vice President of Business Engagement, Center for Climate and Energy Solutions
March 11, 2022
On the U.S. Securities and Exchange Commission (SEC) notice of a March 21 vote to “enhance and standardize” climate-related disclosures:
“Worsening climate change is a threat to businesses and a thriving U.S. economy. The SEC’s anticipated action is a powerful message that improved preparation for climate risks is a financial opportunity and greenlight for prospective investors. How companies address and manage these risks, however, depends on an often complicated, but critical effort to dig down into how a changing climate impacts a company’s physical assets and supply chains and how necessary efforts to transition to a net-zero economy affect companies and how they deliver their products and services. A new C2ES report released this week explores the challenges companies face in measuring their risk and the progress they are making in assessing the climate-related risks and in understanding opportunities for a low-carbon transition.
“Climate change poses a growing threat to our national infrastructure, central banking, federally backed insurance programs, retirement funds, and mortgages. Each year, more companies are improving their understanding of the danger to their bottom lines, and more investors are calling for transparency on climate-related risks. There’s a strong interplay between a company’s approach to its climate risks and opportunities and its commitment to a well-thought-out strategy that achieves net-zero climate pollution emissions. Companies that stay on track to decarbonize by mid-century are better positioned to shape markets and to seize on economic opportunities presented by the low-carbon economy.”
Explore the new C2ES report on how companies approach climate risk disclosures and the role of policy: Emerging Practices in TCFD-aligned Climate Risk and Opportunity Analysis and Disclosure. C2ES’s report also makes the following policy recommendations that would help companies improve their climate-related financial risk disclosure, including:
- Establishing a federal hub with resources to help companies measure risk;
- Setting a standardized but flexible, approach to assess physical and transitional risk;
- Producing federal guidance on the use of scenario analysis that distinguishes between transition scenarios which can be highly sector-specific; and
- Endorsing the recommendations of the Taskforce on Climate-related Financial Disclosures (TCFD) framework.
To reach a C2ES expert, contact Alec Gerlach at firstname.lastname@example.org.
About C2ES: The Center for Climate and Energy Solutions (C2ES) is an independent, nonpartisan, nonprofit organization working to forge practical solutions to climate change. Our mission is to advance strong policy and action to reduce greenhouse gas emissions, promote clean energy, and strengthen resilience to climate impacts. Learn more at www.c2es.org.