UN PRI signatories must report on climate risks from 2020

Signatories to the UN Principles for Responsible Investment (PRI), including investment managers and service providers, will be obliged to report on their management of climate-related risks from 2020.

The PRI introduced voluntary climate risk indicators in 2018, aligned to the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). More than 480 of the 2,250 signatories reported on performance against these indicators in 2018; from 2020 all signatories will be required to do so, although public disclosure will remain voluntary.

“It is increasingly important for investors to incorporate emerging mega risks such as climate change into their view of the future,” said PRI CEO Fiona Reynolds. “TCFD provides the best available framework for systematically including climate-related risks and opportunities into investment strategy. The PRI is pleased to incorporate TCFD into our Reporting Framework and continues to be a strong supporter of the task force’s recommendations.”

The Financial Stability Board’s TCFD published recommendations for voluntary climate-related financial disclosures in 2017, with the intention of providing disclosures that are consistent, comparable, reliable and thus of practical use to investors, insurers and lenders. It is hoped that these disclosures will complement other international initiatives designed to assist investors monitoring climate risks in their portfolios, such as the taxonomy being created for this purpose by the EU.

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