Hm Treasury
The consultation responses were presented to the Financial Reporting Advisory Boards Sustainability Subcommittee (FRAB-SSC) in March 2024. FRAB-SSC expressed satisfaction with the level of interaction and agreed with the proposed changes. With approval from FRAB, HM Treasury published the TCFD-aligned disclosure application guidance for Phase 1 and 2.
The guidance was updated as follows:
- Scope for central government arms length bodies size thresholds have been clarified to includetotal operating income and funding received (including grant-in-aid) exceeding 500 million. This is relevant for Arms Length Bodies that rely on sponsor departments for income rather than from sales of goods and services.
- Sector specific and industrial grouping - additional guidance clarifying where entities operations partially fall into TCFDs sector and industrial group guidance has been clarified.
- Reporting requirements for principal risks - a table and flow chart have been added to aid preparers in identifying reporting requirements depending on whether climate is a principal risk.
- Reporting boundaries - additional details was added setting out the qualitative and quantitative disclosures, which have been clarified, focusing on entity-level reporting (rather than group-level reporting) for the latter.
- Assurance arrangements simplified the technical wording on assurance procedures.
- Opportunities - added high-level guidance on reporting climate-related opportunities, leveraging from existing performance reporting principles.
A summary of the consultation and changes, as well as the FRAB-SSC discussion, and tracked updates from the Exposure Draft are included the paper presented to FRAB - refer to FRAB 152 (02).