Taskforce on Climate-related Financial Disclosures

As the focus on ESG considerations continue, the proposed regulations, (part of the Pension Schemes Act 2021), require trustees to look at climate-related risks and opportunities in more detail. This is in line with Taskforce on Climate-related Financial Disclosures (TCFD) recommendations.

The regulations, due to come into force in October, initially target trustees of larger schemes (£5 billion or more in assets, master trusts and collective defined contribution schemes).

From October 2022, this will apply to schemes with £1 billion or more in assets and by 2023, it is expected that this will be rolled out to smaller schemes.

We are certainly seeing that some schemes are already getting up to speed on the way climate-related risks and opportunities affect the employer’s covenant and have included climate change in their integrated risk management framework.

Early engagement with these regulations is advised.