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Video: 2019 Predictions Series - Sustainable Finance and the TCFD

22 November 2018

We asked several Anthesis experts to comment on sustainability trends and topics that are emerging and changing, impacting businesses, cities and governments globally.  In our second video, Director Fiona Place discusses sustainable finance and the TCFD. #AccordingtoAnthesis

What are some big changes we’re going to see in 2019?

The world is facing unprecedented change with increasing global CO2 levels, with some 40m + working in slave like conditions and continued governance breaches. Tolerance for poor ESG performance is declining amongst the investor community and we will see this continue to build through 2019.

What opportunities will businesses see as a result of these challenges?

Mark Carney, the governor of the bank of England, and chair of the FSB, estimates that there is upwards of 7 trillion U. S. dollars’ worth of opportunity in developing new green infrastructure. This provides an amazing opportunity for businesses to reinvent themselves, and the TCFD framework provides a leading edge set of recommendations in order to support that transition to the low carbon economy.

Is there any regulation or legislation that businesses should be aware of?

Regulators are flexing their muscles, driving ESG in a positive direction. Examples of legislation include the EU shareholder directive and also the CEO employee salary disclosures that are now coming through.

How should businesses respond to these risks and opportunities in 2019?

There are calls for more organizations to adopt the TCFD recommendations in full, to drive systemic change in the way in which climate financial related risk is disclosed. There are opportunities for them to evaluate how resilient their business strategy is to those projected climate risks and also identify the opportunities through things like scenario-planning and whole portfolio analysis.

How can private equity firms support this?

Private equity can no longer afford to be bystanders. They need to support top-tier investors to understand where concentrations of carbon-related assets lie within the value chain and also there’s an opportunity for them to redirect capital to emissions-reduction projects and to protect people from harm.

 

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