Mark Carney, the United Nations special envoy for climate and finance, has called on stock exchanges across the world to back a drive to improve the environmental data shared by companies.
Carney, who until recently was the governor of the Bank of England, has championed a framework from the Task Force on Climate-Related Financial Disclosures (TCFD), which helps companies figure out what information to share.
While the TCFD is currently voluntary, Carney has floated the idea of making it compulsory and is keen to see greater adoption to help investors make more informed decisions when assessing climate-related risks.
Ahead of the next round of U.N. climate talks in Scotland next year – COP26 – Carney and David Schwimmer, the chief executive of the London Stock Exchange Group (LSE) LSEG.L, have written to a number of stock exchanges to urge them to help.
In jointly signed letters to an unspecified number of exchanges, dated July 8, the pair asked them to support a new initiative with the United Nations Sustainable Stock Exchanges (UN SSE) set to launch in September.
The initiative, to be chaired by the LSE, aims to draw up best practice reporting guidance on climate disclosures, which can be used by companies wherever they are listed, to ensure globally consistent disclosures in line with TCFD.
“Ensuring that every professional financial decision takes the risks and opportunities of climate change into account is a core objective of COP 26,” said the letter, seen by Reuters.
“The work of stock exchanges in supporting the widespread adoption of TCFD reporting is critical in this regard.”
Jack Ehnes, chief executive of U.S. pension scheme CalSTRS, also backed the move.
“Institutional investors like CalSTRS need globally consistent high quality climate and sustainability data to inform investment decisions.
“Exchanges can play a critical role to improve the data and reinforce global standards.”