S&P Global Sustainable has generated statistics from their proprietary databases asking a primary question: “How are companies managing climate risk and how?”
The charts highlight the following topics:
- TCFD disclosure
- Climate risk assessment: Transition risk
- Emissions reduction targets
- Climate-related management incentives
- Physical climate risk adaptation plan
Summary Results
In a recent assessment of corporate climate risk disclosures, it was revealed that certain sectors are aligning more closely with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) than others. Notably, the Utilities and Consumer Staples sectors achieved 24.5% and 26% TCFD disclosure alignment, while Real Estate and Financials led the way with 32.7% and 31.9% alignment, respectively.
When it comes to assessing climate assessment transition risks, the Consumer Discretionary and Information Technology sectors take the lead with 28.6% and 28.4% alignment and the Energy and Utilities sectors follow closely behind with 24.6% and 25.2% alignment.
Emissions reduction targets show a similar trend, with Financials and Real Estate sectors lagging behind at 23% and 23.6% alignment, while the Consumer Discretionary and Materials/Information Technology sectors are more ambitious at 28.6% and 28.4% alignment.
Regarding climate-related management incentives, it appears that the Real Estate and Information Technology sectors are offering lower incentives at 12.1% and 12.8%, while the Utilities and Energy sectors are leading the way at 17.7%.
In terms of physical climate risk adaptation plans, the Consumer Discretionary and Information Technology sectors have been somewhat cautious, with only 1.6% and 2.1% alignment, while the Utilities sector stands out with 7.5%, and the Energy sector follows closely at 3.8%. These findings highlight the varying levels of preparedness and alignment with TCFD recommendations across different industries as they grapple with the challenges posed by climate change.
Global – Climate Risk Management
Communication Services – Climate Risk Management
Consumer Discretionary – Climate Risk Management
Consumer Staples – Climate Risk Management
Energy – Climate Risk Management
Financials – Climate Risk Management
Health Care – Climate Risk Management
Industrials – Climate Risk Management
Information Technology – Climate Risk Management
Materials – Climate Risk Management
Real Estate – Climate Risk Management
Utilities – Climate Risk Management
Data: as of Sept. 8, 2023. Chart based on S&P Global ESG Raw data. Results based on responses from 13,810 companies assessed in the 2022 S&P Global Corporate Sustainability Assessment (CSA).
Source: S&P Global Sustainable
