FCA new rules on climate-related disclosures

The FCA has published two Policy Statements confirming final rules and guidance to promote better climate-related financial disclosures.

Issuers of standard listed shares, or equity shares represented by certificates (global depositary receipts) must now include a statement in their annual financial reports setting out whether their disclosures meet the recommendations of the Taskforce on Climate-related Financial Disclosures (TCFD). If they fail to do so, they will need to explain why.

FCA-regulated asset managers and asset owners - including life insurers and pension providers - will have to disclose how they take climate-related risks and opportunities into account in managing investments. They’ll also have to make disclosures about the climate-related attributes of their products.
The rules will come into effect from 1 January 2022. Asset managers and asset owners will have a phased implementation, with the rules initially applying to the largest firms and coming into effect for smaller firms one year later.

The measures are part of the Government’s work to introduce TCFD-aligned disclosures across the economy by 2025, as part of the UK’s wider net-zero commitment and the Government’s Roadmap to Sustainable Investing.

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