In July 2023 the Financial Stability Board (FSB) announced that the work of the Task Force on Climate-related Financial Disclosures (TCFD) has been completed, with the ISSB Standards marking the 'culmination of the work of the TCFD'. Having fulfilled its remit, TCFD disbanded in October 2023.
Companies applying IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures will meet the TCFD recommendations as the recommendations are fully incorporated into the ISSB Standards.
Companies can continue to use the TCFD recommendations should they choose to do so, and some companies may still be required to use the TCFD recommendations. Using the recommendations is a good entry point for companies as they move to use the ISSB Standards.
The IFRS Foundation has published a comparison of the requirements in IFRS S2 and the TCFD recommendations.
The requirements in IFRS S2 are consistent with the four core recommendations and eleven recommended disclosures published by the TCFD.
As demonstrated in the comparison, a company applying IFRS S2 will provide all of the information covered by the TCFD recommendations.
There are additional requirements in IFRS S2. These include the requirements for companies to disclose industry-based metrics, to disclose information about their planned use of carbon credits to achieve their net emissions targets and to disclose additional information about their financed emissions.
The TCFD has been a trailblazer in raising the practice and quality of climate-related disclosures, with the ISSB building on this legacy.
The incorporation of the TCFD recommendations into the ISSB Standards provides yet further simplification of the so-called ‘alphabet soup’ of disclosure initiatives for companies and investors.
The FSB also asked the IFRS Foundation to take over the monitoring of the progress on companies’ climate-related disclosures from the TCFD. The IFRS Foundation has published the Progress on Corporate Climate-related Disclosures—2024 Report in November 2024.
While companies can still use the TCFD recommendations, given the TCFD has now disbanded the list of supporters is no longer active.
