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Cambridge Institute for Sustainability Leadership (CISL)


4 May 2018 – The ClimateWise Principles set to become the go-to TCFD disclosure framework for insurance industry.

The ClimateWise Principles, the insurance industry’s leading disclosure framework on climate change, is set to become the go-to reporting framework for the Financial Stability Board’s Task Force for Climate-related Financial Disclosures. This alignment will expand the scope of The ClimateWise Principles towards delivering the more quantitative metrics envisaged by the TCFD. The announcement coincides with the global launch of the TCFD Knowledge Hub.

“In creating a universal disclosure framework the ambition of the TCFD is unparalleled,” said ClimateWise’s Chairman and Global Chairman of Aon Benfield Dominic Christian. “Consequently, we regard the TCFD as a game-changer for the financial services sector in helping us to communicate our responses to the physical, transition and liability risks of climate change. It’s an alignment that ClimateWise members are willing to throw their support and resources behind.”

ClimateWise is a global insurance industry leadership group facilitated by the University of Cambridge Institute for Sustainability Leadership (CISL). It is at the forefront of applied research into ways the insurance industry can support the transition to a zero-carbon, climate resilient economy. For over a decade, members have been disclosing their activities against the six ClimateWise Principles. This has allowed them to benchmark themselves against their peers and share industry best practise via annual public reviews.

“As the TCFD is in its infancy there remains significant uncertainty over what its future disclosures will look like,” said Director of ClimateWise, Dr. Tom Herbstein. “Addressing this will require a journey from today’s predominantly qualitative reporting to the quantitative disclosures envisaged by the TCFD. It is a tremendously exciting to be able to support the growth of the TCFD in this way.”

Already, significant overlap exists between The ClimateWise Principles and the TCFD. This means that, ClimateWise members have been meeting many of the current TCFD recommendations for ten years. Reporting against The ClimateWise Principles will ultimately allow members to meet both their ClimateWise and TCFD reporting requirements. This alignment has received the backing of the 29 global insurance industry organisations that constitute ClimateWise’s membership.

ClimateWise principles

The TCFD was chaired by Michael Bloomberg, highlighting the growing leadership emerging in this space. It aims to support companies understand the types of climate disclosures required by the financial markets. This helps companies to disclose their exposure to climate change risks in lien with the needs of investors.

 ClimateWise’s complimentary research programme is also exploring how insurer expertise can support the broader financial services sector meet their own disclosure requirements. The ClimateWise Council’s Physical Risk and Transition Risk project are two examples.

As members and supporters of the TCFD, PwC will continue to support ClimateWise as independent reviewers as it aligns the two leading disclosure frameworks. “As the most established disclosure framework for the global insurance industry, The ClimateWise Principles offer members a unique opportunity to play an enhanced leadership role in developing the TCFD,” said PwC’s Partner for Sustainability & Climate Change, Jon Williams. “By providing direct feedback on individual submissions, members not only receive a private benchmarked ranking, against their ClimateWise peers, but also feedback on ways to improve and evolve their TCFD submissions. The emphasis is on ClimateWise members collaborating around best practice.”

Christian adds that “supporting the alignment of The ClimateWise Principles with the TCFD is ClimateWise’s research activities. These research projects are exploring how insurers can improve the quality of their climate disclosures and how insurance expertise can support other parts of the finance sector in its response. ClimateWise’s ‘Physical Risk’ and ‘Transition Risk’ projects are examples of this.”

As support for the TCFD grows, against a backdrop of increasing natural catastrophes, ClimateWise and its global membership will continue to play a leadership role in promoting a universal disclosure framework. As Herbstein reiterated, “ClimateWise welcomes leading insurance organisations in the climate change space to use the disclosure framework and help shape the insurance industry’s role in the transition to the zero carbon, climate resilient economies of the future.”