The 'Next Normal': Climate Change Risk Governance in a Pandemic Age - Part 1
by Mark Standen, Sarah Barker, Ellie Mulholland, Josh Dellios
Published: May, 2020
While immediate pandemic pressures may moderate short-term corporate progress on climate risk assessment and disclosure, there is little to suggest that regulatory and investor expectations have significantly diminished in 2020. Corporates may face increasing investor pressure to make a 'Paris-aligned' business strategy a central pillar of their corporate rebuilding and recovery plans, with a measurable pathway to net zero emissions.
The systemic economic fragilities exposed by COVID-19 illustrate the value of the key risk management tool underpinning corporate strategy on climate change – stress-testing and scenario planning – and the insights it provides in the estimation and reporting of financial position and prospects.
Communicating credible progress on climate risk assessment and transition strategy in the narrative reports and financial statements should remain a key focus for corporates in the lead up to 30 June. We are seeing indications that climate change remains an institutional priority in the 2020 reporting season. This applies in a number of areas:
Download the report below to access our extended insights on corporate climate risk assessment and reporting expectations in FY20. It provides a useful resource for sustainability, finance and executive teams in their consideration of governance priorities beyond the immediate pandemic response.
Part II in our series on climate risk governance in a pandemic age will be released in the coming months: The 'Next Normal' – what next for climate risk governance and investment in a post COVID-19 world?
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