The UK’s Transition Plan Taskforce (TPT) announced today the launch of its new framework for companies to disclose their climate transition plans.
According to TPT Co-Chair and Aviva Group CEO Amanda Blanc, the new disclosure framework is being introduced as companies increasingly announce net zero commitments, but many have yet to publish plans to support their targets, with plans that have been disclosed varying in quality, consistency and level of detail.
“In recent years, we have seen a wave of private companies announcing their ambitions to contribute to net zero. We now need financial firms and companies to come forward with high quality plans to show how they will meet their targets.”
The formation of the TPT was announced last year by then-Chancellor of the Exchequer, and now UK Prime Minister, Rishi Sunak, at COP26, and officially launched in April 2022. At COP26, Sunak announced that the UK will introduce requirements for mandatory disclosure of net zero transition plans from UK financial institutions and listed companies, and HM Treasury unveiled plans to establish the taskforce, composed of industry and academic leaders, regulators, and civil society groups, to develop a “gold standard” for transition plans, in order to guard against greenwashing.
Today’s release includes the TPT Disclosure Framework, which makes recommendations for companies and financial institutions to develop gold-standard transition plans, and the TPT Implementation Guidance, setting out the steps to develop a transition plan, as well as when, where and how to disclose their plan. Additionally, the TPT launched a “Sandbox,” to help users to test implementation of the framework and guidance.
The new Disclosure Framework, which will inform future regulation in the UK, and the accompanying Implementation Guidance draw on existing and emerging standards and recommendations, including the TCFD recommendations, the Glasgow Financial Alliance for Net Zero (GFANZ) and the International Sustainability Standards Board (ISSB).
TPT Steering Group member, and LSEG CEO David Schwimmer, said:
“Financial markets can only play a central role in decarbonising our economy with access to high quality, consistent and comparable data. As other countries consider mandatory transition plans, this work could inform similar regulatory approaches around the world.”
The TPT stated that the framework and guidance are open for public consultation until the end of February, and that it will use the consultation and Sandbox feedback to finalize the tools.
Sacha Sadan, ESG Director of the UK’ Financial Conduct Authority (FCA) said that the regulator aims to use the final outputs from the TPT to strengthen its transition plan disclosure expectations for listed companies and regulated firms.
“We strongly welcome today’s publication of the Transition Plan Taskforce’s Disclosure Framework and Implementation Guidance. The FCA has been actively involved in the development and drafting of these initial outputs.”
Click here to access the Disclosure Framework and Implementation Guidance.