TCFD reporting consulting for climate disclosures your board can stand behind.

What it is

What are the TCFD recommendations and what is TCFD reporting used for?

The Task Force on Climate-related Financial Disclosures was set up by the Financial Stability Board in December 2015 to work out what climate-related information investors, lenders and insurers need to price risk and allocate capital. Its answer, published in June 2017, is a disclosure framework built on four pillars: governance, strategy, risk management, and metrics and targets, expanded into eleven recommended disclosures.

TCFD reporting means describing, pillar by pillar, who oversees climate matters, how climate change could affect the business, how those risks are handled and which numbers management watches. It appears in annual reports, in regulatory filings and in answers to investors and lenders.

Current status. The recommendations of June 2017, supported by implementing guidance released in 2021, remain the text. The Task Force completed its remit and disbanded in October 2023, after its final status report; at the Financial Stability Board's request, the IFRS Foundation took over monitoring of companies' climate-related disclosures, and the Task Force website stays available but is no longer updated. The IFRS Foundation states that the recommendations are fully incorporated into IFRS S1 and IFRS S2, and describes them as a good entry point for companies moving towards the ISSB Standards. ISSB IFRS S1 and IFRS S2 reporting

Who it is for

Who needs TCFD reporting?

The framework was written for issuers of public debt or equity, yet private groups and subsidiaries use it too. Any obligation comes from a regulator or an investor, never from the framework itself. Companies come to Sterling from four starting points:

• A regulator's rules put you in scope. In the United Kingdom, the Financial Conduct Authority applies TCFD-aligned disclosure rules to listed companies, on a comply-or-explain basis in the annual financial report, and to asset managers, life insurers and FCA-regulated pension providers. Elsewhere, we confirm the applicable rules with your legal advisers.
• Investors or lenders ask for it. A fund, a bank's credit team or a sustainability-linked facility wants climate risk described in a recognised structure.
• Your parent company or group needs your data. A listed parent asks each subsidiary for governance, risk and emissions information on the four pillars.
• You want a first step before IFRS S2. A TCFD-aligned report builds the governance, risk process and emissions data that the ISSB Standards later expand on.

Requirements

What are the TCFD requirements?

The framework sets out four core recommendations and eleven recommended disclosures beneath them. Disclosures under strategy and under metrics and targets are expected where the information is material. The lines below summarise each pillar in plain terms; the drafting is tested against the Task Force's own wording and guidance.

• Governance: describe the board's oversight of climate-related risks and opportunities and management's role in assessing and managing them (two disclosures).
• Strategy: describe the climate-related risks and opportunities identified over the short, medium and long term, their impact on the business, strategy and financial planning, and the resilience of the strategy under different climate-related scenarios, including a 2°C or lower scenario (three disclosures).
• Risk Management: describe the processes for identifying and assessing climate-related risks, the processes for managing them, and how both are integrated into overall risk management (three disclosures).
• Metrics and Targets: disclose the metrics used in line with strategy and the risk process; Scope 1, Scope 2 and, if appropriate, Scope 3 greenhouse gas emissions and the related risks; and the targets used and performance against them (three disclosures).

Reporting route

How do you prepare a TCFD report?

There is no certification step at the end. The route runs from scoping to a board-approved disclosure, and the evidence built on the way is what lets the report survive questions from investors, regulators and, later, an assurance provider under the ISSB Standards.

1. 01
   Confirm why you are reporting and for whom.A regulator's rule, an investor request or a group instruction; the entities covered, the first reporting year and where the disclosure will sit.
2. 02
   Gap analysis: test current practice against the eleven disclosures.Review board papers, the risk process, strategy documents and any emissions data, then agree actions, owners and dates.
3. 03
   Identify, assess and embed climate risks and opportunities.Workshops with management across time horizons, transition and physical risks rated in the enterprise risk process, and scenario analysis sized to your exposure.
4. 04
   Build the metrics and draft the disclosures.Scope 1 and 2 emissions, Scope 3 where appropriate, the metrics management will track and any targets, then drafting for each pillar as the evidence settles.
5. 05
   Review, approve and publish, then repeat.Internal review of the data trail, board approval and publication in the right place, then an annual cycle that improves the analysis each year.

Check the route before you sign. The Task Force issued no certificates, accredited no one and has disbanded, so an offer of a "TCFD certificate" or a "TCFD-certified" badge should be declined. Where you report because a regulator requires it, read the rule on the regulator's own website and confirm your scope with your legal advisers. How to choose a credible TCFD reporting provider · The certification buyer's checklist

Cost

How much does TCFD reporting cost?

The cost of a first TCFD report depends on what already exists, not on the length of the document: a company with a sustainability committee, a mature risk register and a measured footprint needs far less work than a group starting from nothing. Every Sterling proposal shows its components and states everything that is included.

Timeline

How long does TCFD reporting take?

For a first report, three to six months is a realistic estimate from kick-off to a draft ready for board review: nearer three where governance and emissions data are in place, nearer six where a group must consolidate many entities or run quantitative scenarios.

Share any fixed deadline at the start; we will say plainly what a first-year report can credibly cover.

Your engagement

What your TCFD reporting engagement includes

Sterling works through the Sterling OS™ phases. You choose one support level: Design™, where we guide and your team does the drafting and data work, or Drive™, where we manage the programme and carry most of the work with your people. After the first report, Sustain™ keeps each annual cycle on track, and Automate™ runs the programme in Effivity.

• Scope, gap analysis and reporting plan

  Entities, first year, publication route, owners and dates, agreed before work begins.

• Climate risk and scenario workshops

  Risks and opportunities identified with management and built into your enterprise risk process.

• Effivity ISO & GRC software

  Registers, evidence and actions in Effivity from day one, included with the engagement at no additional cost.

• Training for everyone

  Internal auditor training for your review team, as applicable to your standard, and preferential Sterling Academy access, including complimentary awareness training for your people as part of the engagement.

• Metrics, targets and drafting support

  Emissions and other metrics defined and calculated, targets set, and each pillar drafted from the evidence.

• Review and board readiness

  An internal review of the data trail and a board briefing before approval and publication.

Sterling does not certify, accredit, attest or validate TCFD reports; your board approves the disclosures and remains responsible for them.

Often combined with

Standards organisations pair with TCFD recommendations

• AA1000AA1000 implementation and requirements: apply the AccountAbility Principles and SES, then prepare for AA1000AS v3 assurance by a licensed provider.
• B Corp CertificationB Corp certification made clear: the new B Lab Standards, Foundation Requirements, seven Impact Topics, the audit route and how Sterling prepares you.
• CBAMCBAM compliance and requirements explained: authorised declarant status, the 50-tonne threshold, verified embedded emissions and how Sterling helps you prepare.
• CDPCDP disclosure consulting: a complete, evidenced response on climate, forests and water, prepared with your team.
• CSDDDCSDDD compliance and requirements after Omnibus I: scoping, risk-based due diligence, complaints, monitoring and the 2029 start, delivered in one all-inclusive proposal.
• CSRD / ESRSCSRD and ESRS Sustainability reporting consulting: double materiality, ESRS disclosures and data prepared for limited assurance of your statement.